No significant improvement

According to the report by the Ministry of Finance, the estimated disbursement rate of public investment capital from the state budget in 2022 by the end of March reached 11.88% of the plan assigned by the Prime Minister, lower than the same period of 2021 (13.17%). The slow disbursement has reduced the efficiency of capital use as well as the attraction of social resources, causing waste and affecting the economic recovery momentum.

Notably, only four ministries and 20 localities have a disbursement rate of over 20%. Some good disbursers include Vietnam Fatherland Front, Thai Binh, Quang Ninh, Ninh Binh, Ba Ria - Vung Tau, Lao Cai, Tra Vinh, Lam Dong, Ben Tre and Nam Dinh provinces.

Meanwhile, 46 out of 51 ministries, central agencies and 29 out of 63 localities have disbursement rates below the national average. In particular, up to 29 ministries and central agencies have not yet implemented the capital disbursement plan. Some of them include the Ministry of Foreign Affairs, Health, Science and Technology, Justice, Education - Training, Vietnam National University-Hanoi and Vietnam National University-Ho Chi Minh City.

The reason for the low disbursement rate, in addition to the impact of the COVID-19 pandemic, is also that the Government assigned 100% of the capital plan in 2022 (Decision 2048/QD-TTg dated December 6, 2021), then further issued Decision 236/QD-TTg on the assignment and adjustment of the medium-term public investment plan with state budget capital for the period of 2021-2025 (phase 2 – February 21, 2022). Therefore, ministries, central and local agencies are still continuing to implement the detailed allocation of the 2022 capital plan assigned by the Prime Minister.

Besides, in the first three months of the year, investors focused on completing documents for payment. Newly started projects were completing investment procedures, implementing bidding, bidding evaluation, and contract negotiation.

In addition, the effect of increasing prices of supplies and materials including iron, steel, sand, stone and cement also slowed down the construction progress of the projects, because continuing construction would make contractors suffer losses compared to the winning bid prices. The financial capacity of a number of construction enterprises was not guaranteed, greatly affecting the construction progress, especially for large and key projects, and there was still a situation of "perfunctory" construction to wait for price reduction or additional resources.

Accelerating disbursement

2022 is an important year, continuing to create a foundation for the whole country to implement the goals of the 5-year plan for the period 2021-2025. In addition, the amount of capital to be disbursed in 2022 is quite large, in addition to the annual plan capital approved by the National Assembly, there is also an additional amount of capital from the capital source for the implementation of the socio-economic recovery and development program.

Therefore, accelerating the disbursement of public investment capital will continue to be the growth driver in 2022 and the incoming period. Attention must be paid to do this work exactly as the Prime Minister’s direction stated in Resolution 01 and Resolution 11.

Slow disbursers should review and clarify the responsibilities of the collectives and individuals involved, and on that basis, propose appropriate solutions for allocation and disbursement in the coming time.

To speed up disbursement, the Ministry of Finance is also continuing to request ministries, sectors and localities that have not fully allocated the capital plan in 2022 to urgently implement detailed capital allocation for projects in accordance with the regulations of the Prime Minister.

In case ministries, central and local agencies have no need to use and have not fully allocated the capital plan for 2022, the Ministry of Finance proposes the Ministry of Planning and Investment summarize and submit to competent authorities to reduce capital plan in 2022 in order to adjust and supplement ministries, central and local agencies with high demand and ability to disburse.

To enhance disbursement, on February 12, 2022, the Prime Minister issued Official Dispatch 126/CD-TTg to ministries, sectors and localities to urge the drastic and effective implementation of the socio-economic recovery and development program; accelerate the disbursement of public investment capital.

Accordingly, the Prime Minister requested each ministry, sector and locality to set up a Working Group to promote capital disbursement to regularly urge, inspect, supervise and promptly handle difficulties, obstacles and bottlenecks in the implementation with the goal of ensuring 100% disbursement of public investment capital under the 2022 plan.

Recently, at the regular Government meeting in March 2022, Prime Minister Pham Minh Chinh requested that ministers, leaders of sectors, heads of ministerial-level agencies needed to focus on speeding up the disbursement of public investment capital and ODA.

"Public investment must definitely not be fragmented, time-consuming, and cumbersome," the Prime Minister emphasized. The head of the Government also requested reviewing and removing difficulties and obstacles in public investment institutions, mechanisms and policies.

In addition, according to economic experts, to accelerate the disbursement of this important investment capital, it is also necessary to soon implement the support packages in the socio-economic recovery and development program, especially in the context of complex developments affecting the current economy.