Joint Circular No. 12/TTLB guiding the recovery and use of loans due for repayment from the National Fund for Employment.

CIRCULAR

OF THE MINISTRY OF LABOR - INVALIDS AND SOCIAL AFFAIRS - FINANCE AND THE PLANNING STATE COUNCIL (NOW THE MINISTRY OF PLANNING AND INVESTMENT) NO. 12/TTLB APRIL 1, 1994 GUIDELINES FOR RECOVERY AND USE OF LOANS DUE FROM THE NATIONAL FUND FOR EMPLOYMENT SOLUTIONS

After more than one year of implementing loans for small projects from the National Fund for Employment Solutions, many localities now have projects that have reached their repayment deadlines. To ensure effective, targeted use and strict management of recovered funds due for repayment at localities and central-level organizations, the Central Ministries of Labor - Invalids and Social Affairs - Finance and the Planning State Council provide the following guidelines on recovery and use of recovered funds:

1. General principles

- Projects borrowing from the National Fund for Employment Solutions must repay both principal and interest upon maturity.

- Funds recovered from a locality or managed by a central-level organization shall be used to lend again within that locality or organization. In cases where it is necessary to reallocate funds, the Central Ministries of Labor - Invalids and Social Affairs - Finance and the Planning State Council will issue separate notifications.

- Funds due for recovery in a given year shall be included in the total loan amount for localities and central-level organizations in that year and managed centrally and uniformly according to the National Fund for Employment Solutions management system.

- A project that has borrowed funds and reached its repayment deadline may be eligible for another loan if there is a genuine need, subject to the following conditions:

+ The borrowed funds were used for the approved purpose.

+ Production is effective and continues to attract additional labor.

+ The project leader must complete all procedures for repaying the principal and interest.

+ If the project is expanded, documentation regarding the expansion must be provided and reviewed and decided upon by the competent authority.

A project that has borrowed funds and whose production cycle exceeds the loan period may continue to borrow. However, the project leader must repay all interest from the previous cycle and obtain approval from the competent authority (Provincial People's Committee or central-level organization) after reviewing the project's implementation.

2. Method of lending with recovered funds

- For initial loans using recovered funds, they shall be implemented normally according to the guidelines of the Central Ministries, but the decision of the Provincial People's Committee approving the loan and the accompanying summary table must clearly state "project using recovered funds" to distinguish it from projects funded by new sources.

- For regional projects and projects of organizations with multiple borrowers, if there is a need for another loan before the repayment deadline, at least one month prior to the deadline, an assessment of effectiveness and determination of the number of people needing further loans should be conducted to adjust the number of borrowers and loan amounts for the next period, without exceeding the initial loan amount.

- For projects of enterprises and traders, when reaching the repayment deadline and needing another loan, a review of the use of borrowed funds according to the approved objectives, especially the criteria for attracting labor and fund utilization efficiency, must be conducted. Projects that have stable production, regular employment for workers, and assured income will not be eligible for further loans, and funds will be transferred to other projects.

- Projects that do not use borrowed funds for the intended purpose, are ineffective, or have low efficiency, lack conditions to repay the principal and interest, shall have their loans suspended, and funds and interest recovered early by the Chairman of the Provincial People's Committee or the head of central-level organizations.

3. Organization of Implementation

- Annually, according to the plan, the Provincial People's Committee, central-level organizations shall organize an evaluation of the implementation of small project loans in the year, calculate the amount due for repayment, determine the loan needs for the planning year (including recovered funds and new supplements), and report periodically to the Central Ministries according to Form No. 02 in Circular No. 06/TT-LB dated May 12, 1993.

- The Treasury Inspection Office shall monitor and urge debt collection upon maturity to ensure full recovery of both principal and interest into the National Fund for Employment Solutions. They shall cooperate with the Departments of Labor - Invalids and Social Affairs, Finance, and Planning to advise the Provincial People's Committee on evaluating the use of borrowed funds by projects, conducting reviews and processing applications for continued loans for projects needing another loan (as guided in Point 2 of this circular), and reporting summaries to the Central Ministries.

- For projects seeking another loan with less than 100 million dong after inspection and evaluation, the Provincial People's Committee or the head of central-level organizations shall issue a loan decision and send it along with the summary form to the Central Ministries. Projects seeking another loan must have a separate decision and summary form (according to Form No. 01 in Circular No. 06/TT-LB dated May 12, 1993).

- For projects seeking another loan with 100 million dong or more, after inspection and evaluation, a summary form (according to the attached summary form in this circular) and a request letter from the Provincial People's Committee (central-level organization) shall be sent to the Central Ministries at least 30 days before the repayment deadline for the Central Ministries to review and direct the State Treasury to continue lending to ensure continuous use of borrowed funds. After agreement from the Central Ministries, the Provincial People's Committee or the head of central-level organizations shall decide on the loan and send the decision and summary form of the agreed-upon projects back to the Central Ministries for monitoring.

During implementation, any issues encountered should be promptly reported to the Central Ministries for study and resolution.

PROVINCE PEOPLE'S COMMITTEE

(CITY - CENTRAL ORGANIZATION)

ANNEX

SUMMARY OF PROJECT IMPLEMENTATION AND NEED FOR ANOTHER LOAN