Many ministries and localities have not allocated enough capital for projects using foreign capital

By the end of May, total allocated capital was VND 455.5 trillion, reaching 98.75% of the capital plan assigned by the Prime Minister. Photo: Thuy Linh.

Total allocated capital is VND 455.5 trillion

According to Clause 4, Article 3 of Decision No. 2185/QD-TTg dated December 21, 2020 of the Prime Minister, ministries, branches, central agencies and People's Committees of provinces and centrally-run cities must allocate a detailed list and level of capital for each project to agencies, units and lower-level People's Committees before December 31, 2020, and send detailed allocation plans to the Ministry of Planning and Investment, Ministry of Finance before January 10, 2021.

According to the Ministry of Finance, by the end of May, the Ministry of Finance had received reports on allocation of State budget capital investment plans of 2021 from all ministries, central agencies and provinces and centrally-run cities.

The report shows up to this point, the total allocated capital is VND 455.5 trillion, reaching 98.75% of the capital plan set by the Prime Minister. If excluding the number of capital plans to balance the local budget, localities assigned increased compared to the number of plans assigned by the Prime Minister, total allocated capital is VND 406.4 trillion, reaching 88.11% of the plan.

The central budget capital is VND 169.5 trillion, reaching 82.34% of the capital plan assigned by the Prime Minister; the capital of local budget balance is VND 285.9 trillion, reaching 111.99% of the plan set by the National Assembly and the Prime Minister.

According to the Ministry of Finance, 34 ministries and 40 localities have not yet allocated an assigned capital plan. The remaining capital plan accounted for 11.89% of the plan assigned by the Government.

Some ministries, central and local agencies have a relatively high proportion of unrealised capital plans, such as the Ministry of Information and Communications (94.77%), Hoa Lac Hi-Tech Park Management Board (88 %), Management Board of Vietnam Ethnic Culture Village (85.21%), Ho Chi Minh National Academy of Politics and Administration (82.16%), Ministry of Science and Technology (77.11%), Ministry of Health (75.91%), Vietnam General Confederation of Labour (74.47%), Phu Tho province (84.3%), Hung Yen province (56.35%) and Bac Ninh province ( 53.06%).

Difficulty in allocating capital for ODA projects

According to the Ministry of Finance, the reason that the central budget capital plan has not been fully allocated is that ministries, central agencies and localities had just assigned capital plans for the first phase, the remaining capital had not been allocated to projects not eligible to allocate public investment plan capital from the State budget of 2021 according to Decision No. 2185/QD-TTg dated December 21, 2020 of the PM because new projects had not been started in the medium-term public investment plan for 2021-2025; projects beyond the prescribed implementation time (under submission to the Prime Minister for handling); planning projects and tasks lacking enough procedures or ODA projects having not yet signed or being adjusted to agreements.

According to the Ministry of Finance, for capital to balance local budgets, 43 of 63 localities assigned capital plans for balancing local budgets increased compared with the Prime Minister's allocation from land use revenue and sources form increasing revenue and source of local lottery.

However, 15/63 localities have not fully allocated a capital plan for balancing the local budget, in which, some localities have a relatively high proportion of unallocated capital such as An Giang (43.33%) and Can Tho (40.55%).

For projects using foreign capital, many ministries and localities have not allocated enough or timely reciprocal capital as committed, greatly affecting the implementation and disbursement of foreign capital.

Notably, many ODA projects borrowed from the World Bank (WB), Asian Development Bank (ADB), and the International Fund for Agricultural Development (IFAD) have been assigned capital plans but have not yet completed extension procedures of the loan agreement due to complex procedures, requiring adjustment of investment policies and reporting to the President, while the current law does not provide for the processing time of the President's documents.