Joint Circular No. 04/LB-TT on Adjusting Salaries and Allowances for Civil Servants and Administrative Staff; Retirees, Those Who Have Stopped Working Due to Health Reasons, Village and Ward Cadres, and Certain Social Policy Beneficiaries in 1997

JOINT CIRCULAR

Guidelines for Adjusting Salaries and Allowances for Civil Servants, Administrative and Public Service Officials, Retirees; those who have lost their ability to work due to illness; village, ward, and town cadres; and certain social policy beneficiaries in 1997 

Implementing Decree No. 06/CP dated January 21, 1997 of the Government on the resolution of salaries and allowances for civil servants, administrative and public service officials, retirees, those who have lost their ability to work due to illness; military forces; village, ward, and town cadres; and certain social policy beneficiaries in 1997, the Ministry of Labor - Invalids and Social Affairs, the Central Organization and Cadre Department of the Government, the Finance Department, and the Central Organization Department provide the following guidelines for implementation:

A. ADJUSTING SALARIES AND ALLOWANCES

I. OBJECTS AND SCOPE OF APPLICATION

1. Cadres and civil servants in the administrative, public service, Party, and mass organizations sectors, including those recruited or contracted within the staffing quota and receiving state budget salaries while working, studying, interning, on duty, undergoing treatment, or convalescence both domestically and abroad, specifically:

Cadres and civil servants in administrative and public service positions currently working in state management agencies from central to district levels, and state-owned public service organizations;

Cadres and staff members in Party and mass organizations from central to district levels;

Cadres and civil servants dispatched to work in villages, wards, and towns;

State cadres and civil servants seconded or dispatched to work in associations, projects, and international organizations based in Vietnam with salaries paid from the state budget;

2. Those receiving retirement pensions, allowances for loss of working capacity due to illness, rubber worker allowances, sick leave allowances, maternity leave allowances, work injury allowances, occupational disease allowances, and survivor benefits.

3. Relatives of two martyrs currently receiving monthly allowances; war invalids with a loss of working capacity of 81% or more; disabled veterans with a loss of working capacity of 61% or more; and caregivers of war invalids and disabled veterans with a loss of working capacity of 81% or more.

4. Village, ward, and town cadres currently working or retired according to Decree No. 50/CP dated July 26, 1995 of the Government;

5. Health workers in villages, wards, and towns receiving salaries under Decision No. 58/TTg dated February 3, 1994 and Decision No. 131/TTg dated March 4, 1995 of the Prime Minister.

II. CALCULATING NEW SALARY AND ALLOWANCE LEVELS

The subjects mentioned in Section I above shall have their salaries, allowances, and subsidies recalculated as follows:

1. For cadres and civil servants in the administrative, public service, Party, and mass organizations sectors.

Based on the salary coefficient and current salary allowance levels stipulated in Decree No. 35 NQ/UBTVQHK9 dated May 17, 1993 of the Standing Committee of the National Assembly, Decision No. 69/QĐ-TW dated May 17, 1993 of the Politburo, Decrees No. 25/CP and No. 26/CP dated May 23, 1993 of the Government, and the adjusted minimum wage level as prescribed in Article 1 of Decree No. 06/CP dated January 21, 1997 of the Government, the new salary and allowance levels shall be recalculated.

a) Formula for recalculating the salary:

New Salary Minimum Wage Rate (144,000 VND/month) x Current Salary Coefficient

b) Formula for recalculating the allowance:

For allowances calculated based on the minimum wage rate:

New Allowance Minimum Wage Rate (144,000 VND/month) x Current Allowance Coefficient

For allowances calculated based on the rank, grade, or elected position:

New Allowance Current Allowance x Allowance Ratio

Specifically, the allowance for full-time positions in the Vietnam Veterans Association shall be calculated based on the equivalent position allowance in political organizations.

c) Formula for recalculating the amount of the differential retention coefficient:

Differential Retention Coefficient Amount Minimum Wage Rate (144,000 VND/month) x Current Differential Retention Coefficient

d) For allowances specified in absolute monetary terms, they shall remain unchanged according to the current regulations.

2. For individuals receiving social insurance benefits

a) Those receiving retirement pensions, allowances for loss of working capacity due to illness, work injury allowances, or occupational disease allowances, rubber worker allowances, and monthly survivor benefits up to December 31, 1996 shall have their pension or allowance levels recalculated using the following formula:

New Pension or Allowance Pension or Allowance Received in December 1996 x 1.2

b) Individuals who start receiving retirement pensions, lump-sum retirement allowances, sick leave allowances, maternity leave allowances, work injury allowances, occupational disease allowances, or survivor benefits from January 1, 1997 onwards shall be calculated based on the minimum wage rate of 144,000 VND/month.

When calculating retirement pensions and social insurance allowances, attention should be given to the following cases:

For those retiring with social insurance contributions based on the salary scales of the state's wage system, when calculating the average salary contribution for determining the monthly pension or lump-sum allowance, it shall be calculated based on the minimum wage rate of 144,000 VND/month;

Example: A cadre retired in February 1997, with the salary contribution history for the last five years before retirement being:

From February 1992 to March 1993 was 425 VND;

From April 1993 to January 1995, the salary coefficient was converted to 3.35;

From February 1995 to January 1997, the salary was received at a coefficient of 3.63.

Calculation of the average salary for pension purposes as follows:

From February 1992 to March 1993: the salary of 425 VND converted by the coefficient equals 3.35 x 144,000 VND x 14 months = 6,753,600 VND;

From April 1993 to January 1995: the salary coefficient of 3.35 x 144,000 VND x 22 months = 10,612,800 VND;

From February 1995 to January 1997: the salary coefficient of 3.63 x 144,000 VND x 24 months = 12,545,280 VND.

Total salary contribution for the last five years:

6,753,600 VND + 10,612,800 VND + 12,545,280 VND = 29,911,680 VND.

The average salary contribution for social insurance to determine the monthly pension is: 29,911,680 VND ÷ 60 months = 498,528 VND.

For those who died (including deaths due to work accidents) before December 31, 1996, funeral expenses and one-time survivor benefits (if applicable) shall be resolved based on the allowance level in 1996.

For those who suffered work accidents or occupational diseases and were discharged from hospital before December 31, 1996, if they are entitled to a one-time allowance, it shall be resolved based on the allowance level in 1996.

For individuals who have retired and received a decision from the Social Insurance agency to receive a one-time allowance before December 31, 1996, the allowance shall be calculated according to the 1996 rate.

Those who have retired and received sickness or maternity allowances before December 31, 1996, if they still have sick leave or maternity leave entitlements to receive social insurance benefits, the allowance amount from January 1, 1997 onwards shall be calculated based on the minimum wage of 144,000 VND per month.

c) For pensioners living alone without direct family care and with no other sources of income who have been adjusted to 180,000 VND/month according to Decision No. 812/TTg dated December 12, 1995 of the Prime Minister, starting from January 1, 1997, they will be adjusted to 216,000 VND/month.

d) For those who have retired due to loss of working capacity and are former military personnel transferred to civilian jobs, having served for twenty years or more in the military or the People's Police, and receiving additional monthly allowances according to Decision No. 812/TTg, the additional monthly allowance from January 1, 1997 shall be calculated based on the minimum wage of 144,000 VND per month.

The regional subsidy (if applicable) of pensioners and social insurance beneficiaries shall also be recalculated as stipulated in sub-item b, point 1 above.

3- For the subjects specified in point 3, Section I above, the monthly allowance adjustment shall be as follows:

Monthly allowance for relatives of two martyrs: increase the allowance from 144,000 VND/month to 200,000 VND/month;

Monthly allowance for war invalids with a disability rate of 61% or higher, as stipulated in Clause 1, Article 46 of Decree No. 28/CP dated April 29, 1995 of the Government, shall be adjusted according to the table below:

War invalids with a disability rate of 81% or higher and war invalids with a disability rate of 81% or higher shall receive an additional allowance of 20,000 VND/month; in special cases involving severe injuries or illnesses, the additional allowance shall be increased from 20,000 VND/month to 40,000 VND/month according to Clause c, Article 1 of Decision No. 201/TTg dated April 9, 1996 of the Prime Minister.

Caregivers for war invalids with a disability rate of 81% or higher (including those treated similarly to war invalids) and caregivers for war invalids with a disability rate of 81% or higher, providing care at home:

If currently receiving a monthly allowance of 96,000 VND, it will be adjusted to 115,200 VND;

If currently receiving a monthly allowance of 120,000 VND, it will be adjusted to 144,000 VND.

Funeral expenses and burial costs, which were previously set at 960,000 VND according to Decree No. 28/CP dated April 29, 1995, will be adjusted to 1,152,000 VND.

The regional subsidy (if applicable) of persons who have made contributions to the revolution shall also be recalculated as stipulated in sub-item b, point 1 above.

4- The monthly subsistence allowance for village, ward, and town cadres currently in service and those who have retired shall be calculated specifically as follows:

a) The subsistence allowance for village, ward, and town cadres currently in service:

The subsistence allowance for the Secretary of the Party Committee (or the Secretary of the Village Party Branch where there is no Village Party Committee), the Chairman of the People's Council, and the Chairman of the People's Committee of the village, from 200,000 VND/month to 240,000 VND/month;

The subsistence allowance for the Deputy Secretary of the Party Committee (or the Acting Secretary of the Village Party Committee), the Deputy Chairman of the People's Council, the Deputy Chairman of the People's Committee, the Head of the Village Militia, the Chief of the Village Police Station, and the Heads of various mass organizations (Vietnam Fatherland Front, Women's Union, Ho Chi Minh Communist Youth Union, Farmers' Association, Veterans' Association), from 180,000 VND/month to 216,000 VND/month;

Other positions from 160,000 VND/month to 192,000 VND/month.

b) The allowance for village cadres who have retired according to Decision No. 130/CP dated June 20, 1975 and Decision No. 111/HĐBT dated October 13, 1981 of the Council of Ministers (now the Government):

The allowance for former Secretaries and Chairmen of the People's Committee of the village, from 100,000 VND/month to 120,000 VND/month.

The allowance for Deputy Secretaries, Deputy Chairmen of the People's Committee of the village, the Head of the Village Militia, and the Chief of the Village Police Station, from 90,000 VND/month to 108,000 VND/month.

The allowance for other positions, from 80,000 VND/month to 96,000 VND/month.

5- For medical staff in villages, wards, and towns who enjoy benefits according to Decision No. 58/TTg dated February 3, 1994 and Decision No. 131/TTg dated March 4, 1995 of the Prime Minister, their salaries shall be adjusted according to the regulations for administrative and public service civil servants as stipulated in point 1, Section II above.

When recalculating salaries, subsidies, and allowances according to the provisions in points 1, 2, 3, 4, and 5 above, if the remainder is less than 50 VND, it shall be disregarded; if the remainder is 50 VND or more, it shall be rounded up to 100 VND.

B) PROCEDURE FOR REPORTING, REVIEWING AND ISSUING THE SALARY FUND AND INCREASED SUBSIDY FUND FOR 1997

 I. PROCEDURE FOR REPORTING AND REVIEWING THE SALARY FUND AND INCREASED SUBSIDY FUND FOR 1997

To have a basis for reviewing the salary fund and increased subsidy fund, based on the guidelines for the subjects and methods of adjusting salaries and allowances as stated in Part A above, Ministries, Departments, Central Agencies, and Provincial People's Committees shall prepare reports requesting the issuance of the salary fund and increased subsidy fund according to the following regulations:

1) For administrative, public service units, Party, and mass organizations.

Ministries, Departments, Central Agencies, and Provincial People's Committees shall prepare reports according to the following procedure:

a) Prepare a list of officials and civil servants (including contractual workers within the staffing quota) receiving salaries from the state budget and the required increase in the salary fund as of December 31, 1996, according to Model Form 1 attached to this Circular for each unit under their management.

b) After preparing the report according to Model Form 1, Ministries, Departments, Central Agencies, and Provincial People's Committees shall compile it according to Model Form 2 and send a letter (with attachments of Model Forms 1 and 2) to the Joint Ministry requesting the increased salary fund for 1997.

As for the State Bank and the trade union system, the report preparation shall still be carried out according to the above regulations, but the additional fund portion shall not be included in the local additional fund total (for trade unions) because the state budget does not allocate funds to these two systems.

2) For commune, ward, town cadres (including commune, ward, town health cadres)

The report preparation shall be conducted in the following sequence:

a) The People's Committee of the commune, ward, town shall prepare three copies of the report according to Form No. 3a, 3b and send them to the People's Committee of the district level (through the District, City, Town, Provincial Administration Organization Department).

b) The People's Committee of the district level shall compile two copies according to Form No. 4a, 4b and send them to the People's Committee of the province, centrally-administered city through the Provincial Administration Organization Department (attach Forms No. 3a, 3b; each type two copies).

c) The People's Committee of the province, centrally-administered city shall compile one copy according to Form No. 5a, 5b and issue a letter (attach Forms No. 3a, 3b, 4a, 4b) to the Joint Ministry requesting approval of the additional fund.

3. For social insurance beneficiaries funded by the state budget up to December 31, 1994.

The Vietnam Social Security shall direct units to prepare reports according to the following provisions:

a) The provincial, centrally-administered city social security agency shall prepare two copies of the report according to Form No. 6 and send them to the Vietnam Social Security.

b) The Vietnam Social Security shall compile one copy according to Form No. 7 and issue a letter (attach Form No. 6 from the locality) to the Joint Ministry of Labor, War Invalids and Social Affairs - Finance requesting review of the additional fund.

4. For certain subjects under Decree No. 28/CP whose subsidy levels have been adjusted.

The report preparation shall be conducted in the following sequence:

a) The Labor, War Invalids and Social Affairs Office at the district level shall prepare three copies of the report according to Form No. 8 and send them to the provincial Labor, War Invalids and Social Affairs Department.

b) The provincial Labor, War Invalids and Social Affairs Department shall compile two copies of the report according to Form No. 9 (with two lists according to Form No. 8 after verification) and send them to the Policy Department for War Invalids and Martyrs - Ministry of Labor, War Invalids and Social Affairs.

c) The Ministry of Labor, War Invalids and Social Affairs shall compile one copy of the report according to Form No. 9 and issue a letter (attach Forms No. 8 and 9 from the district and provincial levels) to the Joint Ministry requesting review of the additional fund.

4. For certain subjects under Decree No. 28/CP whose subsidy levels have been adjusted: Report preparation shall be carried out in the following sequence:

a) The Labor, War Invalids and Social Affairs Office at the district level shall prepare three copies of the report according to Form No. 8 and send them to the provincial Labor, War Invalids and Social Affairs Department.

b) The provincial Labor, War Invalids and Social Affairs Department shall compile two copies of the report according to Form No. 9 (with two lists according to Form No. 8 after verification) and send them to the Policy Department for War Invalids and Martyrs - Ministry of Labor, War Invalids and Social Affairs.

c) The Ministry of Labor, War Invalids and Social Affairs shall compile one copy of the report according to Form No. 9 and issue a letter (attach Forms No. 8 and 9 from the district and provincial levels) to the Joint Ministry requesting review of the additional fund.

II. METHODS OF DISTRIBUTING THE 1997 INCREASED WAGE AND SUBSIDY FUNDS

Distribution shall be carried out on the principle that the wage and increased subsidy funds allocated by the state in the budget estimates of various levels of budget shall be guaranteed and implemented by the corresponding budget level according to the following provisions:

1. The Ministry of Finance shall distribute the funds to budgetary units or through the competent authorities (including Party and mass organizations) receiving salaries from the central government budget.

Local financial agencies shall distribute the funds to budgetary units under the local budget according to current regulations.

2. The Ministry of Finance shall transfer the pension and increased subsidy funds for social insurance beneficiaries funded by the state budget to the Vietnam Social Security. The Vietnam Social Security shall distribute the wage and increased subsidy funds for social insurance beneficiaries from January 1, 1995 to the provincial, centrally-administered city social security agencies.

3. The Ministry of Finance shall base on the detailed allocation table provided by the Ministry of Labor, War Invalids and Social Affairs to authorize the additional subsidy funds for subjects under the policy for persons with meritorious service through the Provincial Finance and Price Bureau.

In the short term, to ensure that beneficiaries can promptly enjoy the adjusted salary and subsidy levels as guided by this Circular, financial agencies at all levels (the Ministry of Finance for central ministries, departments, and Party and mass organizations; the Provincial Finance and Price Bureau for provincial-level agencies) shall temporarily distribute the first and second quarter 1997 wage and increased subsidy funds within the scope of the 1997 budget estimate.

From the third quarter of 1997 onwards, the distribution of wage and increased subsidy funds for central ministries, departments, Party, and mass organizations, and centrally-administered provinces and cities will be carried out by financial agencies at all levels based on the data approved by the Joint Ministry in accordance with government regulations.

C. IMPLEMENTATION ORGANIZATION

To strictly implement Decree No. 06/CP dated January 21, 1997 of the Government and the guidance provided in this Circular, the Joint Ministry requests the Prime Minister of the Ministries, agencies equivalent to ministries, other agencies directly under the Government, and the Chairmen of the People's Committees of centrally-administered provinces and cities to instruct subordinate agencies and units to urgently implement the following requirements:

1. According to their functions and responsibilities, at the ministry, department, Party, and mass organization level at the central level: The Cadre Organization Department or the Cadre Organization Board shall coordinate with the Party Committee and the trade union; at the provincial level: The Provincial Administration Organization Department shall coordinate with the Provincial Party Committee Organization Board; the Provincial Labor, War Invalids and Social Affairs Department, the Provincial Finance and Price Bureau, and the Provincial Federation of Trade Unions shall conduct inspections and reviews of the number of beneficiaries receiving salaries and subsidies from the state budget, eliminate cases of improper receipt of salaries and subsidies, and on this basis, establish lists of beneficiaries whose salaries or subsidies have been adjusted, calculate the wage and increased subsidy funds, and prepare reports in accordance with regulations, submit them to the leadership of the ministry, department, or provincial People's Committee with letters sent to the Joint Ministry for review.

2- Promptly prepare a report requesting the allocation of salary funds and additional allowances in accordance with regulations to be submitted to the Joint Ministry no later than April 1997. Ministries, agencies, localities that have not submitted their reports will not receive salary funds and additional allowances for the third and fourth quarters of 1997, nor will they have their annual settlement approved.

Requests and reports from ministries, agencies, central party organizations, provincial-level cities shall be sent to the Joint Ministry through working groups established pursuant to the Decision of the State Salary Steering Committee in certain regions to prevent loss of documents and ensure timely review.

Based on recalculated salary levels and allowances, require agencies, units, and civil servants to contribute to social insurance and health insurance from January 1, 1997, at a minimum monthly salary rate of 144,000 VND. For beneficiaries under Decree No. 28/CP receiving monthly health insurance allowances, the rates remain unchanged from 1996.

For state-owned enterprises, pending new guidelines, the assignment of salary unit prices will continue according to current regulations, but contributions to and benefits from social insurance and health insurance will be recalculated based on a minimum monthly salary rate of 144,000 VND starting January 1, 1997.

The Joint Ministry's working groups are responsible for assisting the Joint Ministry of Labor, Invalids and Social Affairs, the Government Organizational and Cadre Department, Finance, the Central Party Organization Department, and the Vietnam General Confederation of Labor in inspecting income outside salaries and reviewing 1997 salary funds and additional allowances for ministries, agencies, central party organizations, provincial-level cities. The Joint Ministry will notify the working groups so that ministries, agencies, central party organizations, and provincial-level cities can conveniently submit documents and have their 1997 salary funds and additional allowances reviewed in accordance with government regulations.

This Circular takes effect from January 1, 1997. The 1996 hardship allowance system stipulated in Circular No. 13/LDTBXH-TT dated June 8, 1996, issued by the Ministry of Labor, Invalids and Social Affairs is hereby abolished.

Any difficulties encountered during implementation should be reported to the Joint Ministry for study and resolution.