The quota system of recurrent expenditure allocation has been promulgated by the National Assembly Standing Committee in Resolution No. 01/2021/UBTVQH15 dated September 1, 2021, on principles, criteria and quota for the allocation of recurrent expenditures in 2022. The requirements for saving expenditures have also been mentioned in the Resolution.

The allocation of recurrent expenditures in 2022 must also ensure
the principles of thrift and waste prevention

The budget expenditure quota gradually decreases based on the payroll levels

According to this Resolution, in terms of principle, the development of a quota system for allocating recurrent expenditures of the state budget must be consistent with the state budget balance ability in 2022, the financial plan - state budget for the 2022-2024 period, and the national financial plan for the 2021-2025 period; prioritize resources to implement wage reform following Resolution No. 27-NQ/TW dated May 21, 2018 of the Central Committee of the Party and Resolution of the National Assembly; promote the efficiency and use of state budget, strive to gradually reduce the proportion of recurrent expenditures, contribute to restructuring the state budget, arranging the administrative management apparatus, public non-business units, and arrangement of administrative units at district and commune levels, reducing payrolls, reforming wages and social insurance.

The allocation of recurrent expenditures in 2022 must also ensure the principles of thrift and waste prevention; administrative reform to improve the quality of public services, effectively use the state budget; contribute to renovating financial management for the public non-business sector to reduce the level of direct support for public non-business units.

Putting all recurrent expenditures into administrative expenditure quota of ministries and central agencies with the requirement of absolute savings; reduce expenses for organizing conferences, seminars and delegations on business trips abroad; prioritizing the allocation of funds to the judiciary, the State Audit, and the Government Inspectorate.

Regarding the criteria and quota for allocating estimates of state budget recurrent expenditures to ministries and central agencies, the Resolution clearly stated that the criteria and quotas for expenditure estimates for state management, the Party and organizations; expenditure estimates for non-business fields, defense and security.

In particular, the quota for expenditure estimates of state management, the Party and organizations were regulated in the following direction: the group of the Supreme People's Court, the Supreme People's Procuracy, the Ministry of Justice, and State Audit, Government Inspector; other ministries and central agencies applied allocation quotas following the payroll criteria.

The general quotas for the group of agencies of the Supreme People's Court, the Supreme People's Procuracy, the Ministry of Justice, the State Audit, and the Government Inspectorate would follow VND72 million/staff.

For the remaining ministries and central agencies, the budget allocation quotas would be applied following the regressive method (decreasing based on payroll levels). Specifically, from 100 officials or less, the allocation norm is VND70 million/staff; from the 101th to the 500th official, it would be VND65 million/staff; from the 501st to the 1,000th official, it would be VND61 million/staff and from the 1,001st officials and above, it would be VND57 million/staff.

An average reduction of 10% in direct expenditure from the state budget compared to the 2016-2020 period

For public non-business units that are self-financed partly from recurrent expenditures, the state budget would be allocated to support recurrent expenditures after the units have used non-business revenues to perform tasks or provide public non-business services. At the same time, the support budget will be allocated for the 2022 - 2025 period and requires a minimum reduction of 15% compared to the 2017 – 2021 period as well as the non-business revenue of the units need to save for implementing wage reform.

The budget is only supporting the implementation of wage reform base on the proportion of the budget supporting recurrent expenditure. For public non-business units which are guaranteed by the State for recurrent expenditures, continue to reduce on average by 10% of direct expenditures from the state budget compared to the 2016-2020 period, except for basic and essential public services guaranteed by the state budget, at the same time, save 10% of recurrent expenditure from the annual budget.

As for the criteria and quota for estimates allocation of recurrent expenditure to provinces and cities, the Resolution of the Standing Committee of the National Assembly clarified the criteria and quotas for allocation of expenditures on education; training and vocational training; healthcare, population and family; administrative management; culture and information services.

The allocation quota following the population criteria for radio, television and news services; criteria and quotas for national defense expenditure; social security, order and safety expenditure; economic activities; and local budget reserves.

In 2022, the allocation quotas for education expenditures base on population criteria would be applied for the school age group (from 1 to 18 years old) as follows: the extremely difficult area is VND7,076,200/person; the difficult area is VND4,953,300/person; urban areas is VND3,007,400/person; the remaining areas is VND3,538,100/person.

On the basis of the quota specified in this Clause, in case the rate of recurrent expenditure for teaching and learning activities is less than 19% of the total expenditure on education, additional expenditure will be added to ensure the expenditure ratio on wages, allowances and others (social insurance, health insurance, unemployment insurance, trade union fees, scholarships for boarding ethnic minority students) up to 81% (excluding expenses from tuition collection).

Regarding the local budget reserve, in 2022, the local budget reserve of each locality is 2% of the total local budget expenditure. On the basis of local budget balance expenditure estimates and the actual situation, provinces and cities should proactively arrange local budget reserves following the provisions of the State Budget Law.

According to Minister of Finance Ho Duc Phoc, the goal of allocating resources for recurrent expenditure is to ensure that ministries, central and local agencies have enough resources to perform tasks of state management, socio-economic development, national defense and security, social security regimes following the fields and areas according to current decentralization.

The allocation quotas for recurrent state budget expenditure in 2022 is the basis for the Government to submit to the National Assembly on the state budget estimate and the plan for allocation of the state budget in 2022 according to the provisions of the Law on State Budget.

At the same time, it serves as a basis for the Provincial People's Committee to submit to the People's Council of the same level for making decisions to promulgate quotas on allocation of recurrent expenditures of local budgets and develop local budget expenditure estimates, ensuring compliance with the provisions of the Law on State Budget.