Party and Government leaders and National Assembly deputies attend the meeting. Photo: Quochoi

Positive estimate in a context of potential risks

At the meeting on October 22, 2024, reporting on the 2024 State Budget performance, the 2025 budget estimates, the central budget allocation plan and the 2025-2027 financial and budgetary plan, Deputy Prime Minister and Minister of Finance Ho Duc Phoc said that the estimated state revenue is VND1,966.8 trillion.

The revenue increases by 15.6% compared to the 2024 estimate and by 5% estimated revenue in 2024, and the mobilization rate into the state budget reaches about 16% of GDP.

Of which, the domestic revenue estimate is VND1,668.3 trillion, equivalent to about 85% of the total balanced state budget revenue, an increase of about 6.1% compared to the estimated revenue in 2024.

“The estimate is positive, in the context of the domestic and foreign socio-economic situation still posing many risks and challenges,” the Deputy Prime Minister and Minister of Finance said.

According to the Deputy Prime Minister and Minister of Finance, the state budget revenue estimate still faces potential risks that the world economy sees many fluctuations, the revenue level resumes to normal level, the real estate market does not show signs of recovery, the progress of equitization and state capital divestment is still slow.

Furthermore, the pressure to balance expenditures is very high, especially the increase in expenditures for key infrastructure projects, important and urgent tasks, ensuring social security, etc.

According to the Government's report, the estimated deficit of the State budget in 2025 is VND471.5 trillion, equivalent to about 3.8% of GDP.

By the end of 2025, the public debt ratio is expected to be between 36-37% of GDP, with the Government debt at 34-35% of GDP, remaining within the limits authorised by the National Assembly.

Regarding the State budget expenditure estimate, and the central budget allocation plan for 2025, the Government plans to ensure the following principles: prioritizing the development investment expenditures at a positive level; implementing full and timely debt repayment; estimating contingency expenditures and national reserves at an appropriate level to promptly address unexpected tasks.

The Government plans to ensure sufficient funding for public sector salaries, pensions, social insurance allowance, preferential allowances for meritorious people and other social security policies; ensure recurrent expenditures in an economical manner, and prioritize important national defense, security and political tasks.

Allocate expenditures for national target programs as approved by competent authorities; allocate funds for agencies and units that enjoy special financial and income mechanisms under Resolutions of the National Assembly and the National Assembly Standing Committee.

Deputy Prime Minister and Minister of Finance Ho Duc Phoc, authorized by the Prime Minister, presents the report. Photo: quochoi

In 2025, to ensure sufficient funding for public sector salaries, in addition to budget allocations, it is expected to use about VND 110 trillion from salary reserves.

Accordingly, the estimated state budget expenditure in 2025 is VND2,548.9 trillion.

At the same time, the estimate of VND14.4 trillion is allocated to local areas with lower local revenue in 2025 than in 2023 to ensure the budget expenditure level in 2025 of these localities is not lower than the estimate in 2023, the first year of the budget stabilization period.

The State budget expenditure estimate is expected to be allocated as follows: the development investment expenditure is estimated at VND790.7 trillion, excluding the increase in salary expenditure, reaching over 33% of the total State budget expenditure, said Deputy Prime Minister and Minister of Finance Ho Duc Phoc, this is a very positive level.

Additionally, the estimate of VND14.4 trillion is allocated to local areas with lower local revenue in 2025 than in 2023, the first year of the budget stabilization period.

The estimated recurrent expenditure for the central budget is VND726 trillion. The expenditure increases by about VND53 trillion compared to the 2024 estimate, only partially meeting the proposed increase in expenditure of ministries and agencies.

According to the Government, priority must be given to political, foreign affairs, defense, security tasks, important regimes, policies and tasks; and reduce other recurrent expenditures.

The estimated recurrent spending for local budgets is VND828.6 trillion, ensuring the funding of socio-economic development tasks according to the decentralisation plan.

The public investment disbursement in 2025 needs to be better

In reviewing the report on the 2025 State budget estimate, the National Assembly's Finance and Budget Committee found that many domestic revenues are expected to increase, especially revenues from the three production and business sectors, which increased compared to the estimate in 2024.

However, there are still some revenue items expected to decrease quite significantly while the estimated revenues in 2024 is higher than the estimate, so the Committee recommends clarifying the reasons for the decrease.

Chairman of the National Assembly's Finance and Budget Committee Le Quang Manh presents the Verification Report. Photo: quochoi

The Committee recommended to analyze, evaluate, and forecast more specifically, and clarify the reasons for making the estimated revenue from crude oil in 2025 lower than in 2024. At the same time, build a more active estimate for revenue from import and export activities.

Regarding public investment expenditure, the Committee recommends that the Government continue to promote specific solutions associated with sanctions and promote personal responsibility in disbursing public investment to ensure better disbursement progress in 2025, improve capital use efficiency, and contribute to promoting growth and socio-economic development.

Regarding recurrent expenditure, the Committee agrees with the plans submitted by the Government to the National Assembly.

However, the Committee proposed that ministries, branches and localities continue to reduce recurrent expenditures and cut unnecessary expenditures, closely control expenditures within the budget estimate and the state revenue collection ability to ensure effective use of capital, avoid loss and waste.