Circular No. 10/2011/TT-BTC stipulates on the management and use of project management costs for construction investment projects funded by state budget funds.

CIRCULAR

Provisions on the management and use of project management costs for construction investment projects funded by state budget funds

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Pursuant to Decree No. 118/2008/NĐ-CP dated November 27, 2008 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

Pursuant to Decree No. 60/2003/NĐ-CP dated June 6, 2003 of the Government detailing and guiding the implementation of the State Budget Law No. 01/2002/QH11;

Based on the following Government Decrees: No. 12/2009/NĐ-CP dated February 12, 2009 on project management for construction works; No. 83/2009/NĐ-CP dated October 15, 2009 amending and supplementing certain articles of Government Decree No. 12/2009/NĐ-CP on project management for construction works; No. 112/2009/NĐ-CP dated December 14, 2009 on the management of construction work investment costs,

The Ministry of Finance stipulates provisions on the management and use of project management costs for construction investment projects funded by state budget funds as follows:

Part I

GENERAL PROVISIONS

Article 1. Scope of Regulation

This Circular regulates the management and use of project management costs for construction investment projects funded by state budget funds and government bonds (issued by the Government or local authorities).

Article 2. Applicability

This Circular applies to investors, project management boards (hereinafter referred to as PMBs), organizations, and individuals related to the management, use, inspection, audit, and payment of project management costs for construction investment projects funded by state budget funds and government bonds.

Consulting enterprises implementing project management under consulting contracts are not subject to this Circular.

Article 3. Principles of Management

1. Project management costs for investment projects are all necessary expenses required for investors and PMBs to organize the implementation of project management tasks throughout the entire investment process from the preparation stage until the completion and final settlement approval of the project.

2. Annually, investors and PMBs shall prepare, review, and approve the project management cost budget to ensure economical and effective use. Investors and PMBs managing a project with a total investment amount of less than or equal to 15 billion VND shall implement according to the approved project management cost level in the project's budget; they do not need to prepare and approve the project management cost budget as prescribed above; however, they must comply with the expense items specified in this Circular and not exceed the prescribed rate.

3. Based on the specific conditions of the project, the investor decides whether to establish and approve two separate project management cost budgets (one for the investor's use and one for the PMB's use) or a joint budget for both the investor and the PMB's use.

4. The expenditure levels for the items listed in Article 6 (Content of the project management cost budget) of this Circular shall be implemented according to current regulations applicable to state agencies and public service units.

Part II

SPECIFIC PROVISIONS

Article 4. Basis for preparing the project management cost budget

- Current regulations on the rates for extracting project management costs and investment and construction consulting fees for state-funded projects;

- Current financial management regulations applicable to state agencies and public service units;

- Investment decision; decision approving the construction project budget; decision establishing the PMB;

- Annual salary calculation table for project management staff;

- Other necessary bases of the project.

Article 5. Procedure for preparing the project management cost budget

1. Determining the source of funding for each project:

The determination of funding sources for each assigned project to be recorded in Model No. 01(i)/DT-QLDA - Table for calculating project management funding (attached). Model No. 01(i)/DT-QLDA is prepared separately for each project (i) ranging from 1 to n, specifically as follows:

1.1. Based on the approved total investment amount of the project and the rate for extracting project management costs published by the competent authority to determine the project management cost of the project (denoted as GQLDA). In cases where projects do not have rates in published documents or only undertake preparatory work for the project, it is extracted based on the approved project budget. For ODA projects, if the project agreement specifies the management cost funding level, it shall be implemented according to the agreement.

1.2. Based on the approved total investment amount of the project and the rate for extracting investment and construction consulting fees published by the competent authority to determine the consulting fees for investment and construction undertaken by the investor and PMB (denoted as GTV). In cases where consulting fees do not have rates in published documents, the budget is prepared according to the regulations.

1.3. Determine the specific expenditure for those tasks within the project management costs that the investor and PMB need to hire consultants to perform (denoted as GTTV).

1.4. The project management funding portion that the investor and PMB can use during the project management process (denoted as GQLDA (CĐT)) is determined according to the formula:

1.5. Specific allocation: the portion for the investor's use, the portion for the PMB's use. The allocation ratio corresponds to the division of responsibilities between the investor and the PMB; decided by the investor after reaching a consensus with the PMB based on the task assignment recorded in the PMB establishment decision or task assignment document.

1.6. Forecast the allocation of project management costs for each year of project implementation.

2. Prepare the Summary Table of Funding Sources according to Model No. 02/DT-QLDA attached, clearly identifying: funding extracted from assigned projects, income from consulting services activities after deducting taxes payable (if any); total funding available for use, cumulative funding used in previous years, planned funding for use in the current year, and funding for future years.

3. Prepare the Annual Salary Calculation Table according to Model No. 03/DT-QLDA attached, clearly identifying the list of staff directly involved in project management under three categories: staff receiving salaries from the project, staff receiving salaries under PMB contracts, and staff concurrently managing the project.

4. Prepare the annual project management cost budget according to Model No. 04/DT-QLDA attached.

Article 6. Content of the Project Management Cost Estimate

The content of the project management cost estimate for the year of the project investor and the Project Management Board (BQLDA) is recorded in Form No. 04/DT-QLDA, including specific expenses as follows:

1. Salary expenses: grade and rank salary according to the allocated salary fund; long-term contract salary for individuals receiving salary from the project based on the decision of the competent authority and the current state regulations on salary system.

Determining the salary fund for project management staff must comply with the approved staffing level of the competent authority. In cases where other expense items are saved, the additional salary adjustment coefficient can be applied to those receiving salary from project management costs according to Circular No. 06/2010/TT-BLDTBXH dated April 7, 2010 of the Ministry of Labor, War Invalids and Social Affairs guiding the implementation of the minimum wage for state-owned companies and limited liability companies wholly owned by the State, and any subsequent amendments, supplements, or replacements thereof.

2. Payment for labor services under contracts.

3. Salary allowances: position, region, attraction, high cost, night work, overtime, hazardous, dangerous, mobile, responsibility, allowance for concurrently managing projects, other allowances.

3.1. For overtime allowances, compliance with the Labor Law's provisions on working hours, rest periods, and related implementing documents (Government Decree No. 109/2002/NĐ-CP dated December 27, 2002 amending and supplementing certain articles of Government Decree No. 195/CP dated December 31, 1994 detailing and guiding the implementation of some articles of the Labor Code regarding working hours and rest periods; Joint Circular No. 08/2005/TTLT-BNV-BTC dated January 5, 2005 of the Ministry of Home Affairs and the Ministry of Finance guiding the implementation of the system of payment for night work and overtime for officials, civil servants, and employees; and any subsequent amendments, supplements, or replacements thereof).

3.2. Regarding concurrent project management allowances:

- For officials, civil servants, and employees assigned to concurrently manage projects at a BQLDA, they shall receive project management allowances corresponding to the time spent on the project. The maximum monthly concurrent project management allowance for an individual is equal to 50% of that individual's monthly salary and salary allowances.

- In cases where officials, civil servants, and employees are assigned to concurrently manage multiple BQLDAs, the concurrent project management allowance is determined according to the proportion of time spent on each project, but the total concurrent project management allowance from all projects shall not exceed 100% of the salary and salary allowances based on their rank.

Individuals who have received wages as stipulated in Clause 1 of this Article shall not receive concurrent management allowances as prescribed in this Clause.

4. Reward expenses: regular rewards, ad hoc rewards (if any), and related commendation expenses. The amount of reward expenses for individuals and groups is stipulated in Section 3, Chapter V of Government Decree No. 121/2005/NĐ-CP dated September 30, 2005 detailing and guiding the implementation of certain articles of the Law on Competition and Rewards. The maximum amount set aside in the budget for reward expenses is 15% of the total salary fund according to grades and ranks of the number of officials, workers, and employees within the approved staffing and annual approved wages as specified in point a, Clause 1, Section II of Circular No. 73/2006/TT-BTC dated August 15, 2006 of the Ministry of Finance guiding the establishment, management, and use of the Competition and Reward Fund under Government Decree No. 121/2005/NĐ-CP dated September 30, 2005.

5. Collective welfare expenses: vacation pay, leave benefits, regular hardship allowances, ad hoc hardship allowances, medical expenses.

6. Contributions: social insurance, health insurance, unemployment insurance (if applicable), trade union fees, other deductions for individuals receiving salary from the project based on the decision of the competent authority.

7. Public service payment expenses: electricity, water, environmental sanitation, fuel, vehicle allocation, and other services.

8. Office supplies purchase expenses: office tools, filing cabinets, desks and chairs, stationery, protective equipment, and other items.

9. Information, propaganda, and communication expenses: telephone charges, postal services, fax, internet, books, newspapers, management documents.

10. Conference expenses.

11. Travel expense reimbursement.

12. Rental expenses: rental of transportation means, office space, various service equipment, hiring of experts and lecturers, retraining of staff, and other rentals.

13. Outbound travel expenses: airfare, train, bus tickets, rental transportation, food, accommodation, incidental expenses.

14. Inbound travel expenses: airfare, train, bus tickets, rental transportation, food, accommodation, incidental expenses.

15. Repair expenses for assets.

16. Expenses for purchasing assets for project management: housing, transportation, fire-fighting equipment, computers, computer software, office machines, other assets.

17. Other expenses: taxes, fees, insurance for assets and transportation, hospitality, others.

18. Reserve: 10% of the budget estimate.

Article 7. Reviewing and Approving the Project Management Cost Estimate

1. The project investor shall review and approve the project management cost estimate. In cases where the Project Management Board manages multiple projects for multiple investors, the direct investor shall establish the Project Management Board to conduct the review and approval of the project management cost estimate.

2. Documents for reviewing the project management cost estimate:

- Request for approval; investment decision; decision on approving the construction project estimate; decision on establishing the Project Management Board;

- Table of project management costs according to Form No. 01/DT-QLDA;

- Summary table of project management funding sources according to Form No. 02/DT-QLDA.

- Annual salary calculation table according to Form No. 03/DT-QLDA;

- Annual project management cost estimate according to Form No. 04/DT-QLDA.

3. Contents of reviewing the project management cost estimate.

- Reviewing the content of work, calculation methods, and appropriateness in allocating the budget for each year in the project management cost calculation table according to Form No. 01/DT-QLDA;

- Reviewing the appropriateness in the summary table of project management funding sources according to Form No. 02/DT-QLDA;

- Reviewing the appropriateness of the expenditure items in the annual project management cost estimate according to Form No. 04/DT-QLDA with current national financial standards, norms, and regulations.

4. The decision on approving the annual project management cost estimate according to Form No. 05/QĐ-QLDA shall be sent to the Project Management Board, the payment agency, and related units for implementation.

5. During the implementation period, the project investor and the Project Management Board may independently adjust the expenditures within the approved annual budget and bear responsibility for such adjustments. If the budget is exceeded, it must be reviewed and approved for adjustment and supplementation.

Article 8. Payment of Project Management Costs

1. For project investors and Project Management Boards managing multiple projects, a common Project Management Cost account shall be opened at a capital payment agency to receive project management costs for all managed projects.

2. The capital payment agency shall make payments for project management costs according to the approved project management cost estimates by the project investor, capital payment regulations, current financial management systems, and specific provisions in this Circular.

Article 9. Finalizing Project Management Costs

1. By the latest date of February 28th of the following year, the project investor and the Project Management Board shall prepare the final report on project management costs for the year according to Form No. 01/QT-QLDA; obtain confirmation from the payment agency to serve as the basis for preparing the next year's project management cost estimate. There is no need for review and approval of the finalization.

2. Upon completion and handover for use of the project, the project investor and the Project Management Board shall prepare the final report on project management costs along with the final settlement documents for the completed project to submit to the competent authority for examination and approval according to the regulations on finalizing completed projects funded by state capital.

3. Handling the annual surplus funds

Any surplus from revenues exceeding expenditures or unspent allocated expenditures shall be carried over to subsequent years; simultaneously, they shall be summarized in Form No. 02/DT-QLDA (Section I - Previous Year's Funding Sources Transferred) to establish the next year's budget.

Article 10. Inspection

1. Financial management units under ministries, sectors, and localities shall plan to organize inspections of project management cost management and usage at project investor and Project Management Board units within their jurisdiction.

2. Project investors and Project Management Boards shall organize regular inspections of the implementation of project management cost management and usage at their units.

Article 11. Responsibilities of Related Units

1. Responsibilities of the Project Investor and Project Management Board (PMO)

- Shall be fully responsible for the management and use of project management costs.

- Shall carry out the preparation, review, and approval of the budget estimate for project management costs; prepare the final account report on project management costs, seek confirmation from the settlement authority in accordance with the time and content specified in this Circular.

2. Responsibilities of the payment agency

- Shall be responsible for controlling and settling project management costs in accordance with the regulations on capital settlement, current financial management systems of the State, and specific provisions set forth in this Circular.

- Shall be responsible for reconciling and confirming the funds paid within the year and surplus funds according to the budget at Form No. 01/QT-PMO in the final account report on project management costs of the project investors and PMOs.

3. Responsibilities of Ministries, Sectors, and Localities

Shall regularly inspect the management and use of project management costs for projects funded by state budget capital under their jurisdiction; take measures to handle violations in the management and use of project management costs in accordance with the law for individuals and units involved in such violations.

Part III

IMPLEMENTATION

Article 12. This Circular shall take effect from April 1, 2011, and replace Circular No. 117/2008/TT-BTC dated December 5, 2008, issued by the Ministry of Finance guiding the management and use of project management costs from state budget capital.

Article 13. Project investors and PMOs that have approved the budget estimate for project management costs before the effective date of this Circular shall continue to implement according to the approved budget until the end of the fiscal year; The final settlement shall be carried out in accordance with the provisions of this Circular./.