Circular No. 138/2007/TT-BTC guiding the management, payment, and settlement of investment capital for compensation, support, and resettlement in the Son La Hydropower Project

CIRCULAR

Guidelines for managing, settling, and finalizing investment capital for compensation, support, and resettlement of the Son La Hydropower Project

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BASED on Decree No. 52/1999/NĐ-CP dated July 8, 1999 of the Government on the issuance of the Investment Management and Construction Regulation, Decree No. 12/2000/NĐ-CP dated May 5, 2000, and Decree No. 07/2003/NĐ-CP dated January 30, 2003 on amending and supplementing certain articles of the Investment Management and Construction Regulation issued together with Decree No. 52/1999/NĐ-CP;

BASED on Decree No. 16/2005/NĐ-CP dated February 7, 2005 of the Government on project management for construction investment projects, and Decree No. 112/2006/NĐ-CP dated September 29, 2006 on amending and supplementing certain articles of Decree No. 16/2005/NĐ-CP;

BASED on Decree No. 99/2007/NĐ-CP dated June 13, 2007 of the Government on managing construction investment costs;

BASED on Decision No. 207/2004/QĐ-TTg dated December 11, 2004 of the Prime Minister on issuing the management mechanism and implementation of the Son La Hydropower Project and Decision No. 11/2007/QĐ-TTg dated January 23, 2007 on amending and supplementing certain provisions of the management mechanism and implementation of the Son La Hydropower Project issued together with Decision No. 207/2004/QĐ-TTg;

BASED on Decision No. 02/2007/QĐ-TTg dated January 9, 2007 of the Prime Minister on issuing the regulations on compensation, support, and resettlement of the Son La Hydropower Project and Decision No. 141/2007/QĐ-TTg dated August 24, 2007 of the Prime Minister on amending and supplementing certain provisions of the regulations on compensation, support, and resettlement of the Son La Hydropower Project issued together with Decision No. 02/2007/QĐ-TTg dated January 9, 2007 of the Prime Minister;

The Ministry of Finance issues guidelines for managing, settling, and finalizing investment capital for compensation, support, and resettlement of the Son La Hydropower Project as follows:

I. GENERAL PROVISIONS

1. Scope and Applicability of this Circular:

Projects for compensation, support, and resettlement of the Son La Hydropower Project must meet the following conditions:

- Fall within the scope, objects, and time frame applicable to the regulations on compensation, support, and resettlement of the Son La Hydropower Project issued together with Decision No. 02/2007/QĐ-TTg and Decision No. 141/2007/QĐ-TTg;

- Be included in the overall relocation planning for the Son La Hydropower Project approved by Decision No. 196/2004/QĐ-TTg dated November 29, 2004 of the Prime Minister and decisions of the Prime Minister approving amendments and supplements to the overall relocation planning for the Son La Hydropower Project;

- Be included in the detailed planning of resettlement areas approved by the People's Committees of Son La, Lai Chau, and Dien Bien provinces;

- Implement decisions related to the Prime Minister, the People's Committees of Son La, Lai Chau, and Dien Bien provinces;

- Ensure compliance with the procedures for investment and construction as stipulated in the Investment Management and Construction Regulation issued together with Decree No. 52/1999/NĐ-CP dated July 8, 1999, Decree No. 12/2000/NĐ-CP dated May 5, 2000, Decree No. 07/2003/NĐ-CP dated January 30, 2003, Decree No. 16/2005/NĐ-CP dated February 7, 2005, Decree No. 112/2006/NĐ-CP dated September 29, 2006, and Decree No. 99/2007/NĐ-CP of the Government;

- Be allocated annual investment plans for compensation, support, and resettlement of the Son La Hydropower Project.

2. Sources of Investment Capital for the Project:

- Government bond funds;

- Investment capital of Vietnam Electricity Corporation (EVN).

These sources of capital shall be transferred to the Vietnam Development Bank (VDB) for control and settlement (without settlement fees).

- Other sources of capital: shall be managed according to current regulations corresponding to each source of capital.

II. REGISTRATION AND AUDIT OF ANNUAL INVESTMENT CAPITAL

1. Registration of Capital Investment Needs:

Annually, in accordance with the time limit for preparing the state budget; based on the overall relocation planning for the Son La Hydropower Project approved in the province, the objectives and progress of relocation of the project, actual circumstances, and the ability to implement at the local level; the provincial People's Committee directs the Provincial Project Management Board to prepare resettlement plans and annual capital investment needs to submit to the provincial People's Committee. The provincial People's Committee examines and registers capital investment needs to send to the Office of the Government, the National Steering Committee for the Son La Hydropower Project, relevant ministries (Ministry of Planning and Investment, Ministry of Finance, Ministry of Agriculture and Rural Development), and EVN before July 20 of the previous year (according to Appendix 1 - not detailing each resettlement area according to point B of the appendix) to be submitted to the Prime Minister for decision on allocation for the year.

2. Audit of Capital Allocation:

- Within thirty working days from the date the Prime Minister allocates the annual capital plan; the provincial People's Committee directs the Provincial Project Management Board to coordinate with relevant agencies to check the investment procedures of the projects based on current regulations, develop a plan for allocating compensation, support, and resettlement capital to submit to the provincial People's Committee for approval and send to the Ministry of Finance, Ministry of Planning and Investment, Ministry of Agriculture and Rural Development, and EVN (according to Appendix 1).

- Based on the annual capital investment plan allocated by the Prime Minister, the provincial People's Committee's capital allocation plan, the government bond issuance plan, and EVN's capital plan; the Ministry of Finance audits and provides comments on the allocation of capital investment plans that lack investment procedures and do not comply with the conditions for capital allocation. The provincial People's Committee is responsible for reallocating in accordance with current regulations and sending to the Ministry of Finance and the Vietnam Development Bank for disbursement and settlement. The comments of the Ministry of Finance on the allocation plan and the correct allocation plan of the provincial People's Committee are the basis for the Vietnam Development Bank to disburse and settle.

- Based on the provincial People's Committee's capital allocation plan and the audit comments of the Ministry of Finance; the Vietnam Development Bank notifies its branches in the provinces (VDB branches).

3. Adjustment of Annual Capital Investment Allocation Plan:

- Periodically, the Provincial People's Committee directs the Project Management Board to review the progress of implementation for the year and report to the Provincial People's Committee. Based on the results of the Project Management Board's review, the Provincial People's Committee considers and formulates a plan to adjust the allocation of investment capital to be sent to the Ministry of Finance, the Ministry of Planning and Investment, and EVN. The adjusted capital allocation plan must not delay the progress of compensation, support, and resettlement.

- The deadline for adjusting the capital allocation plan is before October 30 each year. Within seven working days from the date of receipt of the Provincial People's Committee's adjusted capital allocation plan, the Ministry of Finance shall examine and provide comments to the Provincial People's Committee, the Development Bank, and EVN.

- Based on the examination opinion of the Ministry of Finance and the Provincial People's Committee's adjusted capital allocation plan, the Development Bank notifies its branch.

In cases where the planned investment capital is not fully utilized by the end of the planning year (including adjusted investment capital), it may be carried over to the next year for settlement.

III. CAPITAL TRANSFER

1. Basis for Capital Transfer:

- The investment capital plan assigned by the Prime Minister;

- The local capital allocation plan;

- The examination opinion on capital allocation by the Ministry of Finance;

- Project schedule.

2. Procedure for Capital Transfer:

- Based on the funding requirements for settlement of projects, the Development Bank prepares a quarterly capital settlement plan to send to the State Treasury (Central) on the 15th day of the last month of each quarter, and simultaneously sends it to the Ministry of Finance.

- On the basis of the Development Bank's plan, the State Treasury (Central) transfers capital to the Development Bank for settlement.

IV. ADVANCE PAYMENTS, SETTLEMENTS, AND RECOVERY OF ADVANCE PAYMENTS

1. Opening Accounts:

The Project Management Board opens an account at the Development Bank branch; the Development Bank branch guides the Project Management Board on procedures for opening an account.

2. Advance Payments, Settlements, and Recovery of Advance Payments for Investment Preparation Funds, Project Implementation, Completed Quantities, and Detailed Planning Projects for Resettlement Areas:

These are implemented according to the Circular of the Ministry of Finance guiding the management and settlement of investment funds and public service funds with investment characteristics from state budget sources.

3. Settlement of Public Works Relocation Roads:

a) Documents include:

- Decision of the competent authority: approving design, estimate, and selection of contractors in accordance with the Law on Bidding.

- Application for investment capital settlement.

- Transfer documents.

- Calculation table of completed quantity value according to the contract.

- Confirmation of completion of population relocation through this road (by the Project Management Board and the People's Committee of the commune where the relocated population resides).

b) Settlement:

- Within three working days from the date of receiving complete settlement application documents from the contractor in accordance with regulations and validity, the Project Management Board must complete all procedures and transfer the settlement application to the Development Bank Branch.

- Within seven working days from the date of receiving complete settlement application documents from the Project Management Board in accordance with regulations and validity, the Development Bank Branch settles the full value of the project to the contractor according to the contract.

4. Settlement of Construction Projects in Urban Resettlement Areas:

a) The investor can advance the relocation compensation, support, and resettlement capital of the Son La Hydropower Plant to construct essential facilities related to the reception of resettled households in urban resettlement areas and consistent with the resettlement schedule.

b) Basis for determining the total amount of advanced capital:

- Compensation plan and approved compensation estimates by the competent authority for compensation items: office premises, attached works, infrastructure, public works.

- Total value of detailed resettlement area planning estimates and land leveling construction estimates for urban resettlement areas approved by the competent authority.

- Determining the total pre-advanced resettlement capital for constructing essential facilities serving resettlement:

c) Foundation documents, advance capital amounts, recovery of advance payments, settlement documents, and settlement deadlines:

Each phase of project implementation follows the corresponding provisions in Section 2, Part IV of this Circular.

5. Advance Payments, Settlements for Infrastructure and Public Works Construction in Mixed Resettlement Areas:

Advance payments, settlements for infrastructure and public works construction in mixed resettlement areas are implemented according to the Circular of the Ministry of Finance guiding the management of investment capital under the township and town budgets.

6. Advance Payments, Settlements, and Recovery of Relocation Compensation Costs:

6.1. Provisions on Documentation:

a) Documentation submitted once and supplemented when there are adjustments or additions, including:

- The relocation compensation and support plan approved by the competent authority.

- Economic contract (in case implemented by the contractor).

b) The Project Management Board's application for investment capital settlement for each advance payment, settlement, and detailed cost estimate for each compensation item.

c) All relocation compensation payments directly to resettled households and original households must have detailed advance payment and settlement lists for each household with specific addresses.

In special cases, where there is no approved relocation compensation and support plan and compensation estimate but relocation must proceed according to the schedule, the Project Management Board may temporarily advance up to 70% of the estimated total investment cost of the detailed resettlement area planning project and resettlement point planning project for the relocated households.

6.2. Advance Payments, Settlements, and Recovery:

a) Households that need to relocate their residences must be fully compensated before the entire family moves out.

b) Voluntary relocating households:

Must submit a voluntary relocation application in accordance with Clause 5, Article 10 of Decision No. 02/2007/QĐ-TTg dated January 9, 2007, and will be fully compensated before the entire family moves out.

6.3. Settlement Deadlines and Procedures:

- Within seven working days from the date of receiving complete settlement request files (or advance payment) from the Project Management Board in accordance with the regulations (including: the capital investment payment request form and detailed budget estimate for each compensation item accompanied by a detailed list determining the value of each compensation item for each household), the branch of the Development Bank shall control and transfer funds to the Project Management Board so that the Project Management Board can settle payments to households (or the branch of the Development Bank simultaneously pays the contractor according to the proposal of the project owner in the case where the contractor performs the work).

- Within no more than ten working days from the date of receiving funds from the branch of the Development Bank, the Project Management Board is responsible for directly paying compensation costs to households. Each household must sign for receipt and have confirmation from the People's Committee of the commune.

- The payment of compensation costs to households must be completed within no more than ten days from the start of payment.

- Within no more than five working days from the date of completing the payment to households; the Project Management Board must compile and report to the branch of the Development Bank on the situation of compensation cost payments and return any unspent amount (accompanied by an explanatory report).

- Advance compensation costs will be recovered gradually with each payment.

7. Advance Payment, Settlement, and Recovery of Relocation Support Costs:

7.1. Regulations on Documentation:

Follow the provisions at Point 6.1, Part IV of this Circular.

7.2. Advance Payment and Settlement of Costs for Housing Construction, Ancillary Works, and Attached Structures:

Implement according to the progress of housing construction by households; the support for housing construction will be settled a maximum of two times.

- First time: advance payment up to 70% of the support level.

- Second time: settlement at 100% of the support level, simultaneously recovering the advance payment (with a record confirming the completion of the entire project signed by the head of the household, confirmed by the project management board and the People's Committee of the commune of destination).

7.3. Advance Payment and Settlement of Costs for Relocation Expenses:

- In cases where the Project Management Board hires transportation means: settlement once after fulfilling all contents recorded in the contract (confirmed by the project management board and the People's Committee of the commune of destination).

- In cases where the relocated household receives a quota of money to hire transportation means or self-transportation: settlement once immediately after completing the entire relocation process to the new resettlement site (confirmed by the project management board and the People's Committee of the commune of destination).

- Risk support during relocation: support once immediately after a fatal accident occurs or there is a hospitalization record (for those injured and requiring treatment).

- Support for relocating graves: support once according to the regulations of the Provincial People's Committee.

7.4. Advance Payment and Settlement of Costs for Living Support:

a) Food Support:

- Implemented through monetary or food support.

- The first support period is a maximum of three months (implemented immediately after completing the full relocation to the new resettlement site or before relocation).

- Subsequent support periods: implemented periodically according to the regulations of the Provincial People's Committee.

b) Health Support: implemented after completing the full relocation to the new resettlement site as required by the District Health Center and the People's Committee of the commune to prevent diseases at the new resettlement site.

c) Education Support: implemented after completing the full relocation to the new resettlement site, prior to the new school year.

d) Support for Lighting Electricity Usage:

- The first support period is a maximum of three months (implemented immediately after completing the full relocation to the new resettlement site or just before relocation).

- Subsequent support periods: implemented periodically according to the regulations of the Provincial People's Committee.

đ) Fuel Support:

- The first support period is a maximum of three months (implemented immediately after completing the full relocation to the new resettlement site or before relocation).

- Subsequent support periods: implemented periodically according to the regulations of the Provincial People's Committee.

e) Support for Officials, Civil Servants, Workers, Employees...Living Together with Their Families: implemented after the entire family has completed the full relocation to the new resettlement site.

7.5. Advance Payment and Settlement of Costs for Production Support:

a) Support for Resettled Households Implementing Production Plans:

- The first support is a maximum of 50% of the support level.

- Subsequent support periods: implemented according to the progress of implementing the production plan approved by the competent authority at the district level.

b) Agricultural, Forestry, and Fisheries Promotion Support:

- The first advance payment is a maximum of 50% of the contract value.

- Subsequent settlements: implemented according to the progress of implementing the contract.

c) Support for Households Located at the Site, Households Not Required to Relocate but Whose Production Land Has Been Reclaimed: supported once.

7.6. Settlement of Costs for Clearing, Reclamation, and Expansion of Production Land Area:

Settled based on the volume of work completed.

7.7. Advance Payment and Settlement of Costs for Vocational Training and Career Transition Support:

a) Training Support:

- In cases where training is conducted through a training unit: the first advance payment is a maximum of 50% of the contract value, subsequent settlements are made after completing the training contract (with certification or a certificate of completion of the training program according to the regulations of the Provincial People's Committee).

- In cases where workers independently contact training institutions: direct settlement once to the worker after presenting a certificate or a certificate of training consistent with the registered career transition.

b) Purchase of Tools for New Occupations:

Direct settlement once to the worker.

7.8. Settlement of Costs for Training Community Base Cadres:

Direct settlement once to the state organization conducting the training after the training program, plan, or contract is completed and confirmed by the competent authority of the locality.

7.9. Settlement of Costs for Supporting Policy Families:

Settled once before the policy family relocates.

7.10. Settlement of Costs for Supporting Voluntary Relocated Households:

Voluntary relocated households must submit a voluntary relocation application in accordance with Clause 5, Article 10 of Decision No. 02/2007/QĐ-TTg dated January 9, 2007, and will be paid the full support costs before the entire family relocates.

7.11. Settlement of Costs for Supporting Land Management Adjustment Documentation:

Settled once to the competent land management authority after completing the land adjustment documentation (confirmed by the competent authority of the locality).

7.12. Settlement of Costs for Supporting Relocation from Old Houses and Acceptance of New Houses:

Provide one-time support in accordance with the regulations of the local competent authority.

7.13. Payment of costs to support households resettled with fishing boats or ferry boats at their former place of residence, where there are no rivers or lakes at the new resettlement site, and they cannot fish or use boats:

Make a one-time payment to the resettled household after they have fully relocated to the resettlement site.

7.14. Payment of costs for encouraging relocation according to schedule:

Implement in accordance with the decision of the Provincial People's Committee.

7.15. Payment of costs to support individuals holding positions and receiving salaries or salary supplements from the state at the original location, who do not hold such positions at the resettlement site:

Make a one-time (or periodic) payment starting from the first month immediately following the completion of the full relocation to the resettlement site.

7.16. Payment of costs to support the adjustment of administrative boundaries of communes required due to the implementation of resettlement:

Implement in accordance with the decision of the Provincial People's Committee.

7.17. Time limit and procedure for payment:

Implement in accordance with Point 6.3, Part IV of this Circular.

8. Payment of costs for organizing compensation, support, and resettlement:

8.1. Source of funds:

Extracted in accordance with current government regulations from the capital allocated annually for compensation, support, and resettlement of the Son La Hydropower Project.

8.2. Management and use:

Implement budget preparation, management, use, payment, and settlement in accordance with the Circular of the Ministry of Finance guiding the implementation of Decree No. 197/2004/NĐ-CP dated December 3, 2004, of the Government on compensation, support, and resettlement when the State requisitions land.

9. Payment of project management costs:

9.1. Source of funds:

- Allocated in the annual capital plan for resettlement of the Son La Hydropower Project from project and construction management activities in accordance with the Circular of the Ministry of Finance guiding the management and use of project management costs for projects funded by the state budget.

- The provincial project management board is supplemented with operational funds to carry out general project management tasks from the approved budget estimate in accordance with current regulations for administrative units.

9.2. Management and use of project management costs:

- Implemented in accordance with the Circular of the Ministry of Finance guiding the management and use of project management costs for projects funded by the state budget.

- For funds formed from approved budgets in accordance with current regulations for administrative units: The provincial project management board must prepare a budget estimate for implementing various tasks such as consolidation, guidance, inspection, etc., submit it for approval by the competent authority, and settle accounts in accordance with current regulations.

V. SETTLEMENT OF INVESTMENT CAPITAL

1. Settlement of investment capital:

- For project management costs: The project management board prepares a settlement report in accordance with the Circular of the Ministry of Finance guiding the management and use of project management costs from state budget capital and current regulations for administrative units.

- For construction contracts: Within thirty days after the contractor fulfills all obligations under the contract (excluding warranty obligations), the project management board and the contractor are responsible for settling the construction contract in accordance with the Circular of the Ministry of Construction guiding contracts in construction activities.

- For detailed planning investment capital for resettlement areas, preparatory investment, construction works, and project investment capital (including inter-area and inter-regional resettlement construction projects serving resettlement): The project management board prepares a settlement report for construction investment capital and project investment capital in accordance with the Circular of the Ministry of Finance guiding the settlement of completed project investment capital from state sources.

- For infrastructure and public works in resettlement areas implemented in a mixed manner: Settle accounts in accordance with the Circular of the Ministry of Finance guiding the management of capital investments within the municipal budget.

- For compensation, support, and resettlement costs paid directly to households: As follows:

+ The project management board prepares a settlement report based on the economic items that have occurred and lists them in Appendix 6.

+ The financial agency approving the compensation, support, and resettlement plan reviews the settlement.

+ The agency approving the compensation, support, and resettlement plan (Provincial People's Committee or District People's Committee) approves the settlement.

After approval, these costs are consolidated into the value of the completed project.

2. Settlement of capital sources: On January 31 each year, the Development Bank reports to the Ministry of Finance and EVN on the project capital source up to December 31 of the previous year (according to Appendix 5).

3. Accounting system:

The project management boards for compensation, relocation, and resettlement of the Son La Hydropower Project in Son La, Dien Bien, and Lai Chau provinces implement the accounting system applicable to project sponsors issued by the Ministry of Finance.

4. Recovered expenditures:

VI. REPORTS

1. For the project sponsor (Provincial People's Committee):

Monthly, quarterly, and at the end of the planned year, the Provincial People's Committee reports to the National Steering Committee for the Son La Hydropower Project, the Ministry of Finance, and the Ministry of Planning and Investment on the implementation of the investment capital plan (according to Appendix 2).

2. For the Development Bank:

- Monthly, the Development Bank reports to the Ministry of Finance and the State Treasury on the project investment capital payment situation (according to Appendix 3).

- Quarterly, the Development Bank branch reports to the Development Bank and the Department of Finance on the receipt, allocation, payment, and settlement of completed projects and related information. The Development Bank reports to the Ministry of Finance, the State Treasury, and EVN on the receipt and payment of compensation, support, and resettlement capital (according to Appendix 4).

The fourth quarter report is replaced by an annual report on January 20 of the following year.

3. Reconciliation of investment capital payments:

- By the 15th day of the first month of the next quarter, the Development Bank branch and the project management board reconcile the investment capital payment data for the previous quarter.

- Before January 31 of the following year, the Development Bank shall reconcile with the State Treasury and EVN the amount of capital received and paid out in the previous year.

VII. IMPLEMENTATION

1. People's Committees of the provinces: Son La, Dien Bien, Lai Chau:

- Shall be responsible for managing and organizing the implementation of compensation, support, and resettlement projects in accordance with the State's policies and investment progress approved by competent authorities;

- Direct provincial functional agencies to inspect and urge Project Management Boards to implement plans, receive and use investment capital for their intended purposes in compliance with current regulations.

- Report as required and bear responsibility for the accuracy of the reports.

2. Project Management Board:

- Shall be responsible for organizing the implementation, management, inspection, and supervision of the project in accordance with tasks assigned by competent authorities in compliance with current regulations;

- Receive and use funds for their intended purposes, for the correct beneficiaries, economically, and effectively;

- Inspect and supervise the implementation regarding the quantity and quality of works and sub-works (including housing and workloads undertaken by households);

- When construction works are completed and meet conditions for payment, conduct acceptance inspections and promptly process payment procedures for contractors;

- Bear responsibility for the accuracy and legality of the completed construction works subject to payment and data provided to the Development Bank and state functional agencies;

- Implement periodic reporting and final settlement of investment capital as prescribed.

3. Development Bank:

- Issue a Payment Control Procedure in accordance with this Circular to simplify administrative procedures and facilitate Project Management Boards;

- Announce the investment capital to Development Bank branches, direct and inspect branch activities related to timely, comprehensive, and compliant payment control;

- Report and settle investment capital as prescribed;

- Promptly report to the Ministry of Finance any difficulties or issues encountered during the execution of payment control and compensation, support, and resettlement tasks for the Son La Hydropower Project;

- Development Bank branches shall be responsible for controlling payments for compensation, support, and resettlement in accordance with current national regulations, submit regular reports, conduct reconciliation of investment capital payment data as stipulated in this Circular, and promptly report to the Development Bank any difficulties or issues encountered during payment control.

4. Organizations, households, individuals, and community residents:

- Receive and use compensation and support funds for their intended purposes, in the correct quantities, and with quality and effectiveness.

- Supervise the implementation regarding the quantity and quality of works carried out by Project Management Boards and contractors in relation to households and communities.

- Inspect and reconcile with state policies and regulations on the accuracy and legality of received compensation and support amounts.

This Circular takes effect fifteen days from its publication in the Official Gazette and replaces Circular No. 104/2005/TT-BTC dated November 25, 2005, issued by the Ministry of Finance, guiding the management and payment of investment capital for the compensation, relocation, and resettlement project of the Son La Hydropower Project.

Any difficulties encountered during implementation should be reported promptly to the Ministry of Finance for study, guidance, supplementation, and amendment./.