Directive No. 02/2005/CT-BXD on Enhancing Investment Efficiency and Preventing Losses and Wastage in Construction Investments for Units under the Management of the Ministry of Construction

DIRECTIVE

On Enhancing Investment Efficiency and Preventing Losses and Wastage

In Construction Investments for Units Under the Management of the Ministry of Construction

In recent years, enterprises and units under the Ministry's management have actively and proactively implemented investment projects with diversified industry structures, flexible investment forms, diverse sources of investment capital, expanded production and business operations, thereby significantly enhancing their development capabilities, contributing to economic growth, structural transformation, and sustainable economic development nationwide.

However, the management of investments and construction in these units still has some shortcomings and issues: the investment efficiency of some projects remains low; the allocation and disbursement of investment funds for certain projects continue to face many difficulties; some investors have not strictly adhered to regulations on procedures and processes in investment and construction management, and have not adequately focused on finalizing the settlement of investment funds for completed projects that have been put into operation and use.

To implement the Construction Law; Resolution No. 36/2004/QH11 of the Sixth Session of the Eleventh National Assembly on basic construction investment using state capital; Resolution No. 01/2005/NQ-CP dated January 14, 2005 of the Government on key measures to guide the implementation of the socio-economic plan and state budget for 2005; to enhance investment efficiency and prevent losses and wastage in construction investments; the Minister of Construction instructs the Chairmen of the Board of Directors, General Directors of State-owned Corporations, General Directors of Parent Companies in the Parent Company - Subsidiary model, Directors of independent companies, and Heads of units under the management of the Ministry of Construction to organize the implementation of the following contents:

1. Widely disseminate and strictly implement the contents of the Construction Law, guiding Decrees and Circulars issued together; Resolution No. 36/2004/QH11 of the Sixth Session of the Eleventh National Assembly on basic construction investment using state capital, considering this as the core task of the unit in 2005.

Continue to strictly implement the Directives: No. 29/2003/CT-TTg dated December 23, 2003 of the Prime Minister on rectifying investment and construction management using state capital; No. 19/2003/CT-TTg dated September 11, 2003 of the Prime Minister on organizing urban planning and construction management according to plans; No. 05/2004/CT-BXD dated September 16, 2004 of the Minister of Construction on rectifying investment and financial management at state-owned enterprises under the Ministry's management.

2. Conduct a review and officially approve the Production and Business Plan and Development Investment Plan for 2005 of the unit, ensuring completion beyond the target set for the 2001-2005 phase (report to the Ministry before April 15, 2005); develop Strategic Orientation for Development for the 2006-2010 phase of the unit, ensuring stable and sustainable growth (report to the Ministry before May 15, 2005).

Continue to review investment projects regarding planning, schedule, procedures, progress, volume (including both physical quantity and value), quality, capital balance, supply-demand forecast, and investment effectiveness.

For ongoing investment projects: ensure sufficient funding sources and accelerate project implementation progress to bring them into operation and use as soon as possible, especially key projects in cement, electricity, housing development, and urban areas, and important projects of the unit; decisively halt ineffective investment projects; study to enable equity participation from the outset for some large-scale projects requiring substantial capital. For large projects comprising multiple independent components, consider separating them into individual projects to attract more investors.

For projects currently being prepared for investment: select key projects with guaranteed effectiveness, leveraging strengths, tapping potential, and highlighting the unit's core business areas; review planning, technical standards, market conditions, and funding availability for the project; do not decide on new investments for ineffective projects.

The decision-maker for investment must be responsible for the project's effectiveness, particularly when investing outside the enterprise or abroad, based on the principle that "the person making the investment decision bears full personal responsibility for the project's investment effectiveness."

Review and expedite the settlement of investment capital: for projects completed and put into operation and use before December 31, 2004, investors must complete the settlement process within 2005.

By May 15, 2005, all State-owned Corporations, companies, and units under the Ministry must submit reports reviewing the above contents to the Ministry.

4. Departments and Bureaus under the Ministry must strengthen reviews, revisions, and supplements to economic and technical standards, norms, and quotas to align with advancements in construction science and technology, meeting the requirements of state management in construction.

Investors, design consultants, supervisory consultants, and construction contractors must strictly adhere to and implement current economic and technical standards, norms, and quotas during the implementation of investment projects.

Strengthen and improve the quality and effectiveness of investment supervision and evaluation; organize regular supervision and evaluation of investments as prescribed and report periodically to the Ministry. Investment supervision and evaluation must be considered a continuous and important task in investment and construction management.

Properly implement the internal delegation of authority within the unit regarding construction investment management as stipulated by the Construction Law and the Ministry; strictly enforce sanctions concerning the responsibilities of the investment decision-makers; the responsibilities of the investor, directly the project management board; the responsibilities of technical design consulting organizations, supervisory consulting organizations, and construction contractors regarding the progress, quality of construction works, and the effectiveness of investment projects, particularly emphasizing the management of construction work quality.

Study, review, amend, and supplement internal regulations of the unit on investment construction management, land management and use in accordance with current legal documents on investment construction at all stages of project implementation, including both domestic investment projects and overseas investment projects, from investment policy to acceptance, payment, settlement, operation, and utilization phases.

Units with housing development and urban area investment projects must check and review the implementation, promptly amend and supplement provisions and regulations on selling and leasing houses and land with infrastructure to ensure transparency and market prices; simultaneously, strictly monitor and plan the rotation of project management staff in sensitive positions where negative practices may occur.

7. For projects using state budget capital (including development investment capital, target programs, economic affairs, science, ODA, regular maintenance...): based on the 2005 annual investment capital plan assigned by the Ministry, the investor must urgently organize implementation in accordance with current regulations, determine and report to the Ministry the specific progress for completing each project component early for use, and must be strictly managed according to legal regulations and the Ministry's classification.

For planning construction projects: The Project Management Board will survey planning construction, relevant departments will review procedures and contracts, and coordinate with Planning and Architecture Departments and Construction Departments of provinces and centrally-administered cities where the projects are located to urge and support the assigned units to ensure project progress, quality, and disbursement schedule.

For projects using other sources of capital: units should proactively develop investment plans consistent with planning, market conditions, and their ability to implement projects. Investment projects of enterprises must have investment plans from the previous year and must be approved by the Ministry regarding investment policies before project establishment; after making investment decisions, they must report to the Ministry for monitoring and supervision.

8. Strictly follow procedures, formalities, and regulations on selecting contractors for investment projects; limit the application of designated tendering and restricted tendering methods, and prohibit assigning contracts to organizations and individuals who lack the qualifications and capacity stipulated by the Construction Law; prohibit design contractors from signing supervisory consulting contracts with investors for projects they designed; prohibit construction supervision contractors from signing contracts with construction contractors to inspect the quality of projects they supervise.

Establish and publicly announce a list of organizations and individuals violating the Construction Law in advisory and construction activities.

9. Review and improve organizational structures and machinery for investment construction management; ensure that project management boards have the necessary conditions and professional capacity appropriate to the type and level of construction projects as prescribed by the Construction Law; select responsible, ethical, and experienced personnel to manage investment construction; strengthen decentralization linked to the personal responsibility of key officials; reduce administrative procedures within总公司和单位内部；主动、经常地举办关于专业知识、业务技能和职业道德教育的培训班，为从事项目管理工作的干部。

10. Focus on directing and thoroughly rectifying the situation of outstanding debts in investment construction; refrain from accepting or undertaking construction projects without clear funding sources; actively recover funds for completed projects that have not been settled and have accumulated arrears; take specific measures to handle each debt, clearly identifying the collective and individual responsibilities for causing outstanding debts in investment construction within the unit.

11. Develop plans and strictly implement inspections, checks, self-inspections, and supervision of investment construction and land management and use from the beginning of the year, including domestic and overseas investment projects, joint venture projects, limited partnership projects, or projects of state-owned enterprises and participating companies after shareholding reform; check the implementation of contracting and sales contracts for houses and land with infrastructure in housing development and urban area investment projects (including those undertaken by the unit and those subcontracted by the unit); resolutely combat waste and corruption in all stages of investment construction.

Continue to implement and enforce Circular Joint No. 03/2002/TTLT-BXD-BCA dated May 30, 2002, of the Ministry of Construction and the Ministry of Public Security on coordinating security and public order protection work for agencies and units under the Ministry of Construction.

12. Organize implementation.

In 2005, which is the year of "Improving the Effectiveness of Investment to Prevent Waste and Overextension, and Outstanding Debts in Basic Construction Investment," the Ministry of Construction requires units under its management to set an example and lead in improving project quality, combating waste and overextension in investment construction, and managing and utilizing land in accordance with the spirit of the National Assembly Resolution, Government Resolution, Prime Minister's Directive, and the Ministry of Construction's Ministerial Directive.

Entrust the Department of Planning and Statistics to take the lead, coordinate with relevant Bureaus, Departments, and Construction Inspection in their respective functions to guide, urge, inspect, and compile reports on the implementation results of the Ministerial Directive to the Ministry Leadership.

The Chairmen of the Board of Directors, General Managers of State-Owned Corporations, General Managers of Parent Companies in the Parent Company-Subsidiary Model Pilot, Directors of independent companies, and Heads of units under the Ministry's management are responsible for strictly organizing the implementation of this Directive./.