Use the budget to support small and medium enterprises: Add “push” for recovery

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Small and medium enterprises need a lot of resources to invest and develop. Photo: H.D

Ensure the right purpose, object

Decree 80/2021/ND-CP of the Government detailing and guiding the implementation of a number of articles of the Law on SME Support has requested the Ministry of Finance to base itself on the plan and estimate of the state budget to support SMEs compiled by the Ministry of Planning and Investment and based on the allocation capacity of the state budget, every year, the Ministry of Finance arranges and distributes budget estimates for recurrent expenditures for supporting contents of SMEs in accordance with the provisions of the State Budget Law and the Law on Supporting SMEs and this Decree. The Ministry of Finance must also lead and guide the mechanism of using state budget funds for recurrent expenditures to support SMEs according to regulations; funding for management of SME support activities as prescribed in Decree 80.

On that basis, the Ministry of Finance issued Circular No. 52/2023/TT-BTC guiding the mechanism of using state budget funds for recurrent expenditures to support SMEs in accordance with the provisions of Decree No. 80/2021/ND-CP. Government (Circular 52) with effect from September 23, 2023. This Circular guides the mechanism of using state budget funds for regular expenditure to support SMEs in technology, consulting, innovative start-ups, participation in industry clusters and value chains; human resource development, etc.

The funding source for the implementation of supporting contents for SMEs is the state budget for recurrent expenditure, including the central budget and the local budget according to budget decentralization. In addition, there are contributions and sponsorships from domestic and foreign enterprises, organizations and individuals and other legal sources of funding outside the state budget. Therefore, Circular 52 has detailed regulations on the principles of fund management and use, etc.

Accordingly, the Circular specifically stipulates the content of spending to support SMEs in technology; advise; supporting SMEs to start up creatively, join industry clusters, value chains, etc. Along with that, support to organize training courses on corporate governance; starting a business; direct training at SMEs in the field of production and processing; Online training through available online teaching tools, etc.

The Circular also stipulates the expenditure content and level of expenditure for the management, operation and maintenance of the network of consultants and fostering, training and developing the network of consultants; upgrade, maintain, manage and operate the Portal and collect and update information into the SME support database.

Circular 52 requires the process of making, deciding, assigning estimates, implementing and accounting, auditing and finalizing state budget support for SMEs according to regulations, ensuring the right purposes, objects, spending content, and norms expenditures, levels of support and principles for implementing support which are specified in Decree No. 80/2021/ND-CP, guidance in this Circular and other relevant legal regulations. The support is based on the ability to balance resources and prioritize support in each period of the annual state budget.

More resources for recovery

Since 2018, the Law on Supporting SMEs has taken effect, so since then, many decrees and circulars guiding the implementation of the Law have been issued. However, the level of enforcement of the policies so far has not been really effective. Many SMEs do not even know the support policies they can enjoy.

According to experts, in the current context, the resilience of a part of enterprises has reached the limit. Dr. To Hoai Nam, Standing Vice Chairman and General Secretary of the Vietnam Association of SMEs, said that SMEs need resources to recover, change sales methods, management technology or invest in infrastructure.

The promulgation of Circular 52 is expected by the business community to be more unified and comprehensive on issues in supporting SMEs from the state budget. Because Circular 52 takes effect, it will replace Circular 49/2019/TT-BTC and Circular 54/2019/TT-BTC guiding the management and use of state budget funds to support SMEs in developing human resources, using consulting services under the network of consultants issued by the Ministry of Finance since 2019.

However, enterprises expect agencies and units to manage and use funds to ensure the rationality, validity, efficiency and savings in the use of funds; as well as to ensure the truthfulness, accuracy, transparency, and completeness of relevant documents and dossiers, etc. In particular, the support must be to the right objects, right target, and there must be propaganda activities, publicize information for SMEs to know and receive advice and support.

According to the Report on Human Resources in some fields in 2023, just published by Navigos Group, the business recovery of enterprises has not yet taken place quickly in the near future because businesses are facing a lot of pressure. The survey results of 500 enterprises representing industries in the manufacturing sector by Navigos Group showed that most businesses predict that it will take 12 months or more for the market to recover, only 8% of them Industry believes that the economy will recover after 3 months.

Therefore, Dr. To Hoai Nam emphasized, management agencies must promote business support, especially SMEs to promote start-ups to increase the quality and quantity of the business community. The representative of the SME community also suggested that the National Assembly and the Government should soon amend the Law on SME Support and aim to promote the implementation of support policies with a focus on transforming from business households into enterprises, and implementing Program to support private sector businesses to do sustainable business in the period of 2022-2025. Management agencies also need to come up with solutions and policies to support Vietnamese businesses to improve their capacity to participate more deeply in the global supply chain.