Joint Circular No. 11/2001/TTLT/BTC-BNN&PTNT guiding certain levels of expenditure applicable to the Agricultural Diversification Project.

CIRCULAR

JOINT CIRCULAR OF THE MINISTRY OF FINANCE AND THE MINISTRY OF AGRICULTURE AND RURAL DEVELOPMENT NO. 11/2001/TTLT/BTC-BNN&PTNT OF FEBRUARY 8, 2001 GUIDING CERTAIN EXPENSE LEVELS APPLICABLE TO THE AGRICULTURAL DIVERSIFICATION PROJECT

WHEREAS, the Credit Agreement (Cr.3099-VN) was signed on September 8, 1998 between the Government of Vietnam and the International Development Association, World Bank regarding the Agricultural Diversification Project.

WHEREAS, Decree No. 87/CP dated August 5, 1997 of the Government promulgating the management and utilization regulations for official development assistance.

WHEREAS, Decree No. 87/CP dated December 19, 1996 of the Government detailing the delegation of authority, preparation, and implementation of state budget; Decree No. 51/1998/NĐ-CP dated July 18, 1998 of the Government amending and supplementing certain articles of Decree No. 87/CP and other guiding documents.

WHEREAS, Decision No. 349/QĐ-TTg dated April 25, 1998 of the Prime Minister approving the Agricultural Diversification Project.

To strengthen and unify the management of project expenditures,  the two ministries of Finance and Agriculture and Rural Development hereby guide certain expense levels applicable to the Agricultural Diversification Project as follows:  The Ministry of Agriculture and Rural Development guides certain levels of expenditure applicable to the Agricultural Diversification Project as follows:

I. GENERAL PROVISIONS:

1. The state budget funds allocated to the Project include: World Bank loan (IDA) and counterpart funding from the Government of Vietnam.

2. The IDA loan from the Government of Vietnam for the Agricultural Diversification Project is part of state revenue, therefore all expenditures for the project must comply with current financial regulations in Vietnam and the expenditure standards set forth in this Circular.

3. Scope of application: All activities related to project expenditures managed by the Ministry of Agriculture and Rural Development and implemented by the provinces.

4. The Ministry of Agriculture and Rural Development and the provinces implementing the project are responsible for using the project funds for their intended purposes and contents approved in accordance with the loan agreement conditions and have the responsibility to manage and supervise project assets according to the current state regulations.

This Circular only stipulates certain expense levels for the portion of the project managed by the Ministry of Agriculture and Rural Development. The loan credit portion will be guided separately by other documents.

II. CONTENTS AND EXPENSE LEVELS:

1. The Project includes the following components:

Expenditure on agricultural extension work for rubber cultivation

- Research on rubber

- Expenditure on agricultural extension work for livestock breeding and crop cultivation.

- Pilot model for fruit tree planting development.

- Survey and land allocation expenses

- Access roads to production areas.

- Support for ethnic minority development.

- Human resource development.

- Project management expenses

2. Specific expense levels:

2.1. Salary payment system for staff of the Central and Provincial Project Management Boards:

+ For civil servants assigned from administrative and public service units to work at the Project Management Board, salaries shall be paid according to the current salary scale of the State.

+ For contractual workers (if any): The Director of the Central or Provincial Project Management Board shall select through a contract form, after obtaining the consent of the Ministry of Agriculture and Rural Development (for the Central Project Management Board) and the People's Committee of the province (for the Provincial Project Management Board). For short-term contractual workers, the recruitment of temporary workers shall apply; the payment level is as follows:

* Economic and technical specialists with a bachelor's degree or higher (coordinators, etc.): maximum labor cost of 600,000 VND/person/month.

* Administrative staff: maximum labor cost of 350,000 VND/person/month.

* Drivers: maximum labor cost of 450,000 VND/person/month.

(The above contractual workers shall not receive additional salary supplements).

2.2. Salary supplements for Project Management Board staff:

Applicable to civil servants within the state establishment working for the Central or Provincial Project Management Board. In addition to the current salary, they shall also receive a supplementary allowance from the project budget of 50% of the basic salary.

(The above allowances do not apply to those hired by foreign experts).

2.3. Training costs for county-level agricultural extension officers (rubber extension component); teacher training; agricultural extension officers and key farmer training (livestock extension component, human resource development component, ethnic minority support component):

The expense levels shall be applied according to the provisions in Circular No. 93/1998/TT-BTC dated June 30, 1998 of the Ministry of Finance regarding conference expenditure regulations. Additionally, the following expense levels shall apply:

Payment for instructors during class hours shall not exceed 15,000 VND/hour (except for primary teacher training classes where the instructor fee is 20,000 VND/hour).

- Payment for practical guidance instructors shall not exceed 10,000 VND/hour.

- New textbook compilation: 25,000 VND/page typed on A4 paper (for agricultural extension teacher training and county-level agricultural extension officer training classes) and 10,000 VND/page typed on A4 paper (for key farmer training classes).

2.4. Travel allowance and fieldwork allowance for county-level agricultural extension officers and project participants:

Maximum expense level of 300,000 VND/person/month and calculated based on working days (not applicable to those mentioned in Point 2.1 above).

2.5. Allowance for key farmers participating in the project: expense level of 100,000 VND/person/month.

2.6. Construction costs for livestock farming demonstration sites (livestock extension component), including the following two items:

- Teacher training for livestock farming: expense levels shall be applied according to Point 2.3, Section 2 above. Specifically, the costs for demonstration models serving the classes are as follows:

+ Livestock farming teacher training class for cattle: purchase of 2 cows, concentrate feed, grass, and veterinary drugs, with total costs not exceeding 5,300,000 VND/model (excluding the recovered product value after slaughter).

+ Livestock farming teacher training class for pigs: purchase of 2 pigs, feed, and veterinary drugs, with total costs not exceeding 2,200,000 VND/model (excluding the recovered product value after slaughter).

(Recovered product value from cattle and pig models after slaughter: calculated at 60% of the product quantity).

+ Hiring butchers for inspection: 40,000 VND/cow and 25,000 VND/pig.

+ Hiring quality meat analysis: 2 samples for analysis per animal, the analysis fee based on the actual price at the local area.

Costs for demonstration models in counties and provinces implementing the project:

The project supports funding for purchasing feed and veterinary drugs for the model according to the following percentage ratio and based on the economic and technical norms issued by the Ministry of Agriculture and Rural Development; the purchase price of feed and veterinary drugs based on the current price at the local area.

Feed and veterinary drug support as follows: In 2001, the project covers 100% of the cost for purchasing feed and veterinary drugs, in 2002 it supports 75%, in 2003 it supports 50%, and in 2004 it supports 25%.

* Hiring technical guidance staff to monitor and implement the model: For retired scientific and technical personnel or those not on state payroll, the provincial project management board signs a contract at a rate of 360,000 VND per person per month per model and calculates for working days during the implementation period of the model (one staff member for one model).

In cases where the technical guidance staff implementing the model belong to agricultural extension organizations or are state employees receiving salaries from the state budget, the allowance shall not exceed 200,000 VND per person per month per model and calculated for working days in the month.

* Duration of the model implementation: Cattle model: 2 months; Pig model: 4 months.

2.7/ Hiring domestic experts (high-level agricultural extension component) including a full-package rental fee: Salary, travel expenses, and transportation costs for the expert, with a maximum amount of 450 USD per person per month.

2.8/ Expenses for overseas study tours, learning, and surveys: As stipulated in Circular No. 45/1999/TT-BTC dated May 4, 1999, issued by the Ministry of Finance.

2.9/ Travel allowances and accommodation:

For the central project management board and the local project management board to apply according to the provisions of Circular No. 94/1998/TT-BTC dated June 30, 1998, issued by the Ministry of Finance, regarding travel allowances for state officials on domestic business trips.

Special case for project staff traveling with foreign experts to inspect projects, their travel allowances will be increased by 0.5 times compared to the provisions of Circular No. 94 mentioned above.

2.10/ Labor costs for general workers locally such as planting trees, watering, weeding, etc., with a maximum expenditure of 20,000 VND per day per person. Special case for spraying plant protection chemicals: 25,000 VND per day per person, applicable only to the pilot development component of fruit trees and research on rubber.

2.11/ Other expenses:

Translation costs for project documents: Translating from foreign languages to Vietnamese: 35,000 VND per typed page A4 (300 words per page) including typing costs. Translating from Vietnamese to English or other foreign languages: 40,000 VND per typed page A4 (300 words per page) including typing costs.

- Hiring interpreters for meetings (in cases where the unit does not have its own interpreter): 30,000 VND per hour, including hiring ethnic minority language interpreters.

- Preparing documents in ethnic minority languages: 80,000 VND per typed page A4 (300 words per page), including typing costs.

- Training fees for international bidding experts: For experts hired for equipment and goods outside the expertise of the industry, the expense level is 100,000 VND per day per person (not state employees). For state employees, the allowance is 50,000 VND per day per person (not exceeding 10 days per tender package).

Bidding evaluation expenses are covered from the proceeds of selling tender documents.

Special case for international consulting expert bidding expenses, which are covered from the project's funding.

3/ Economic and technical norms:

3.1/ Land surveying and allocation component: Apply the current economic and technical norms and prices issued by the General Department of Land Administration.

3.2/ Road upgrading component entering the rubber plantation area; Building post-harvest processing facilities, etc., of the pilot fruit tree development component; Building communal houses for the component supporting the development of ethnic minorities,...: Apply current construction norms, prices, and procedures, and comply with the project agreement regulations.

3.3/ Agricultural extension component for rubber; Livestock and crop extension; Pilot fruit tree cultivation development; Rubber research, including components such as establishing nurseries, group gardens,... apply economic and technical norms issued by the Ministry of Agriculture and Rural Development ensuring compliance with the project agreement and other current economic and technical norms.

Based on the aforementioned expenditure levels and economic and technical norms, and current expenditure levels, the provincial project management boards and the central project management board prepare detailed budgets for each assigned work component in accordance with the current regulations on administrative and public service expenditures (for components with administrative and public service nature) and construction expenditures (for road upgrading components entering the rubber plantation area,...) and implement according to the procedures stipulated in Joint Circular No. 81/1998/TTLT-BTC-NHNN dated June 17, 1998, issued by the Ministry of Finance and the State Bank of Vietnam.

Guidelines for the process, procedures, and management of withdrawing funds from official development assistance capital; Decision No. 96/2000/QĐ-BTC dated June 12, 2000, issued by the Minister of Finance detailing the process and procedures for withdrawing ODA funds, serving as the basis for withdrawing funds from the special account of the project.

III/ INSPECTION, REPORTING AND ACCOUNTING, SETTLEMENT

1/ Settlement of state budget funds allocated to the project is carried out in accordance with Decision No. 999 TC/QĐ/CĐKT dated November 2, 1996, issued by the Ministry of Finance, concerning the issuance of the accounting system for administrative and public services and current guiding documents.

2/ To ensure that state budget funds allocated to the project are used for their intended purposes and effectively, the Ministry of Agriculture and Rural Development has the responsibility to coordinate with financial authorities at the same level to regularly and randomly inspect the management, use, auditing, and settlement of project funds at implementing units.

Expenditures exceeding norms, improper expenditures, and expenditures not in accordance with the project agreement content must be recovered and returned to the state budget; Whoever orders improper expenditures must compensate the treasury and bear legal responsibility.

IV/ IMPLEMENTATION PROVISIONS

This circular takes effect 15 days after the date of signature and replaces previous guiding documents on expenditure levels for the project.

For amounts that have been spent before the date of issuance of this Circular and are settled based on actual expenditures but not exceeding the spending limit set forth in this Circular.

During implementation, if any issues arise, the Central Project Management Board and local Project Management Boards shall promptly report them to the Joint Ministries for study, revision, and supplementation.