Enterprise arrangement and development support fund to be abolished

The Ministry of Finance has proposed the collection from the restructuring of State-owned enterprises (SOEs) to go directly to the State budget instead of the Enterprise Arrangement and Development Support Fund in an effort to improve efficiency in using this revenue.

 

This was highlighted in the draft decree about managing and using State money collected from transferring ownership at enterprises and State capital divestment, which the ministry recently made public for comments.

Under the current regulations, the sums collected from restructuring and equitising SOEs and State capital divestment were paid to the Enterprise Arrangement and Development Support Fund first then sent to the State budget or spent in the restructuring of SOEs.

However, this mechanism proved to be inefficient. Due to the lack of strong punishments, many sums were not paid to the fund on time.

If the decree is approved, the Enterprise Arrangement and Development Support Fund would be abolished.

The fund also had no reason for existence any longer as the National Assembly’s Resolution No 60/2018/QH regulated that the sums collected from equitising and divesting SOEs must be paid adequately and on time and must be included in the annual State budget plan and medium-term public investment plan.

The ministry said that it was necessary to issue the decree to improve the efficiency in using this revenue, prioritise important projects to bring the highest socio-economic efficiency while ensuring resources for the SOE restructuring process.

The decree was expected to be submitted to the Government for approval in the third quarter of this year.

Statistics showed that from 2016 to 2019, the Enterprise Arrangement and Development Support Fund transferred VND205 trillion (US$8.84 billion) to the State budget to allocate for the 2016-20 medium-term public investment plan.

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