Circular No. 14-TC/NLTL guiding the implementation of Directive No. 139-CP on handling policies for flood-prone areas.

CIRCULAR

Guidelines for Implementing Directive No. 139-CP on Handling Policies for Flood Diversion Areas

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To proactively address major floods, the Prime Minister has recently issued Directive No. 139-CP dated August 14, 1973, guiding the redirection of all aspects of production and living conditions in flood diversion areas, while specifying certain concrete issues regarding policies for handling flood diversion areas.

To implement the above directive, the Ministry of Finance provides guidelines on cases where state budget funds will be invested to assist flood diversion areas and the procedures for disbursing, paying out, and settling accounts for such funds as follows:

I. ON REORGANIZING PRODUCTION ORGANIZATIONS AND ANIMAL RAISING, AS WELL AS RELOCATING POPULATIONS TO BE SUITABLE WITH THE LOCATION OF FLOOD DIVERSION AREAS

1. Investment in constructing physical and technical facilities such as irrigation networks, trunk roads, state-owned economic establishments, public works, etc...

- For projects under central management, the central budget will cover the costs. Relevant ministries will prepare budgets and directly negotiate with the State Planning Commission and the Ministry of Finance to resolve these matters.

- For local projects, factories, and warehouses managed by local budgets, if the local budget cannot fully meet the needs, the central budget will provide subsidies.

- For village-level projects such as branch roads, small-scale water conservancy works, and village public welfare projects: the village budget will bear the cost and mobilize additional labor contributions from the people. If there is a shortage in the budget, the locality will provide partial assistance.

2. Assistance in helping cooperatives and the people to redirect their production and living activities.

If production bases (sheds, warehouses, agricultural product processing facilities) and residential houses of the people are relocated according to the guidance of the Water Resources Department, the Agricultural Committee, and the local administrative committee, they can apply the state's assistance policy as stipulated in Resolution No. 28-CP dated February 16, 1973, of the Council of Ministers and Circular No. 129-TTg dated May 19, 1973, of the Prime Minister on river clearance work. Specifically:

- Relocating physical and technical facilities of cooperatives shall be based on the remaining value of fixed assets of those facilities to assist in covering the costs of material damage for reconstruction, with central budget funds providing support. If the cooperative needs to expand further but still lacks resources, the state budget will provide loans.

- Relocating residential houses: the central budget will provide assistance at an average rate of 416 dong per household (400 dong in cash and 16 dong to purchase 40 kg of rice per household, at supply prices).

The level of assistance for each cooperative and each category will be determined by the provincial administrative committee, taking into account the degree of material damage and relocation costs, the capacity of each cooperative and each assisted category, in accordance with the principle that the state's assistance policy aims to promote self-reliance, mutual assistance among the people, and partial state support to alleviate difficulties for cooperatives and the people, avoiding dependence on the state.

In places where relocation is not necessary and only measures to prevent flooding are needed, such as raising house foundations, building raised floors, constructing earthen mounds, high shelters, preparing boats and racks to store property, shelter, and travel during flooding, generally, cooperatives and the people should mobilize their own capital and materials, and local labor and mutual assistance among the people to undertake these tasks themselves. The state will sell and provide materials like coal, cement, lime, bricks, bamboo, and leaves, which cooperatives and the people cannot self-provide, depending on its ability to balance supplies.

II. ON HANDLING POLICIES WHEN FLOODS OCCUR IN FLOOD DIVERSION AREAS

After the state has provided assistance to cooperatives and the people to redirect their production and living activities, if floods occur in any year causing losses to property, income, and living conditions, financial assistance policies will be handled according to the provisions of Article 3 (Sub-items a, b, c, d, e, g) of Directive No. 119-CP dated August 14, 1973, of the Council of Ministers.

Regarding the implementation of tax exemption and reduction policies for agriculture, it will be handled specifically as follows: when the agricultural production system is officially established in flood diversion areas, the obligation to pay taxes will continue to be applied according to the current system, based on the taxable yield and stable tax rates. If there is no flooding, taxes will be calculated and collected according to the stable yields and tax rates for each crop season. If there is flooding and the cooperative suffers losses, tax exemptions will be considered according to the following principles:

- If the actual harvest is less than 50% of the taxable yield of the crop season, the entire crop season tax will be exempted;

- Where the water recedes quickly and efforts are made to replant, the tax will be exempted;
- New winter crops just forming will temporarily be exempted from tax.

III. PROCEDURES FOR PREPARING BUDGET ESTIMATES, DISBURSING FUNDS, AND SETTLING ACCOUNTS FOR FUNDS ASSISTED BY THE STATE BUDGET.

A. PREPARATION AND REVIEW OF BUDGET ESTIMATES.

1. For investment in constructing physical and technical facilities:

- Projects under central management will have their budgets prepared by relevant ministries and general administrations. Local projects will have their budgets prepared by related departments and submitted for review by the local administrative committees, with costs covered by the local budget.

At both the central and local levels, relevant sectors will base their preparation of the 1974 state budget estimates on Directive No. 139-CP dated August 14, 1973, of the Council of Ministers and this circular of the Ministry of Finance, promptly submitting them to the State Planning Commission and the Ministry of Finance for resolution.

2. For assistance to the people and cooperatives:

Provincial and municipal administrative committees are responsible for guiding county administrative committees in preparing budget estimates for handling policies in flood diversion areas, creating conditions for the people to redirect their production and living activities.

- Assistance for relocating physical and technical facilities of cooperatives and villages (if applicable);

- Assistance for relocating residential houses of the people.

Provincial and municipal administrative committees will review the budget estimates and submit them to the Ministry of Finance for central budget subsidies. Assistance for village budgets (if applicable) will be subsidized by the local budget.

B. ORGANIZATION OF REVIEW, DISBURSEMENT, AND PAYMENT OF ASSISTANCE FUNDS TO COOPERATIVES AND THE PEOPLE.

The review of subsidies in accordance with Directive No. 139-CP of the Council of Ministers and this guiding Circular of the Ministry of Finance must be strictly directed by the Provincial Administrative Committee to ensure compliance with policy, correct target groups, and avoid fostering a reliance on the State or causing discord among the people. Therefore:

- First, it is necessary to effectively organize the dissemination and thorough transmission of the main contents of the policy so that cooperatives and people in flood-prone areas strictly comply with the redirection of production and living activities in these areas.

- Emphasize the sense of responsibility of state agencies at the provincial and district levels, ensuring fair, timely, and direct distribution of assistance to the people, cooperatives, or communes receiving aid. Departments and Bureaus of Finance must provide specific guidance for District Finance Offices to coordinate with relevant departments at the district level to assist the District Administrative Committee in directing the relocation of production facilities and housing, reviewing lists of units and individuals eligible for assistance policies, and organizing meticulous distribution at commune administrative offices.

C. SETTLEMENT

For expenses subsidized by the central budget, the Provincial Administrative Committee has the responsibility to settle accounts with the Ministry of Finance according to current settlement regulations. Any surplus must be returned to the central budget, while any deficit will be considered for additional allocation.

For expenses subsidized by the provincial budget, settlement shall be made within the provincial budget for the planning year.

Departments and Bureaus of Finance have the responsibility to assist the Provincial Administrative Committee in reviewing the settlement of the District Administrative Committees and compiling reports for settlement with the Ministry of Finance (regarding the portion subsidized by the central budget).

This Circular guides the implementation of Directive No. 139-CP of the Council of Ministers dated August 14, 1973, concerning specific policies for flood-prone areas. In the short term, it aims to create conditions for localities and sectors to concentrate efforts to decisively and urgently complete the redirection of production and living activities of the people in each flood-prone area, striving to ensure key tasks before the 1974 flood season.

The Ministry of Finance requests related central sectors and Provincial Administrative Committees to properly guide the preparation of the 1974 expense budget to facilitate timely implementation of the Council of Ministers' directive in flood-prone areas from the beginning of 1974. Requests for central budget assistance from provinces and cities must be signed by the Chairman of the Provincial Administrative Committee and accompanied by necessary documents, and reported to the Ministry of Finance by authorized staff in December 1973.