The government said it may not be able to apply an increase in the minimum wage as expected from May 1, 2013 due to a lack of finances.
Deputy Prime Minister Vu Van Ninh said on the sideline of the NA’s meeting
Minister of Finance Vuong Dinh Hue, on behalf of the government, delivered a report on state budget estimates for 2012 and 2013 to the National Assembly on October 22.
According to Hue if the government increased the minimum wage from current VND1.05 million (USD50.31) to VND1.3 million (USD62.29) per month and pensions from a current 25% to 30% beginning from May 1, 2013, it would need around VND60 trillion (USD2.87 billion). However, the government has just arranged over VND28.9 trillion (USD1.38 billion) due to the decrease in budget revenues.
Deputy Prime Minister Vu Van Ninh said on the sideline of the NA’s meeting that it’s not true that the government would not raise salaries. It needed more time to balance its budget for this year before reaching a final decision. Therefore, the government proposed the NA to delay pay raises.
A recent report on the national socioeconomic situation in 2012 said that due to the impact of the global economic downturn, the country has recorded a decrease in state budget revenues, particularly export revenues. In addition, the government’s tax extensions and deferments had tightened the budget.
In the first nine months of this year, state budget revenues totalled over VND498 trillion (USD23.86 billion), accounting for 67.3% of this year’s estimate, up 1.3% from the same period last year. Gross domestic income completed 63.8% of the target and crude export revenues met 99.6% of the plan.
State budget spending reached over VND643 trillion (USD30.8 billion) during the period, accounting for 71.2% of the target.
The country’s total budget revenue may reach VND741.5 trillion (USD35.52 billion) this year, up 5.3% from a year earlier.
Meanwhile, budget spending could total VND904.1 trillion (USD43.32 billion) this year, up 0.11% from the estimate and up 14.6% from a year before. The budget deficit may account for 4.8% of GDP.
Regarding payment issues, NA deputy Tran Hoang Ngan proposed that if the government cannot increase minimum wage in general, salaries in particular areas should be adjusted.
