Circular No. 154/2007/TT-BTC guiding the determination of needs, sources, and methods of expenditure to implement the adjustment of the general minimum wage for cadres, civil servants, public officials, armed forces, and subsidies for village cadres who retired in 2008.

CIRCULAR

Guidelines for determining needs, sources, and methods of expenditure to implement

adjustments to the minimum wage level for civil servants, public officials,

employees, armed forces personnel, and adjustments to allowances for retired village cadres

in 2008

Decree No. 166/2007/NĐ-CP November 16, 2007, Government Decree adjusting the general minimum wage level;
Decree No. 184/2007/NĐ-CP December 17, 2007, Government Decree adjusting pensions, social insurance allowances, and monthly allowances for retired village cadres;
Decree No. 77/2003/NĐ-CP July 1, 2003, Government Decree stipulating functions, tasks, authorities, and organizational structure of the Ministry of Finance,
The Ministry of Finance provides guidelines on determining needs, sources, and methods of expenditure to implement the adjustment of the general minimum wage level for civil servants, public officials, employees, and armed forces personnel in 2008 as prescribed in the Government Decree 166/2007/NĐ-CP November 16, 2007, adjusting the general minimum wage level and adjusting allowances for retired village cadres according to the Government Decree 184/2007/NĐ-CP December 17, 2007, adjusting pensions, social insurance allowances, and monthly allowances for retired village cadres (hereinafter referred to as Decree 166/2007/NĐ-CP, Decree 184/2007/NĐ-CP) as follows:

I. GENERAL PROVISIONS:

1. This Circular stipulates the determination of needs, sources, and methods of expenditure to implement the adjustment of the general minimum wage level according to Decree 166/2007/NĐ-CP for state agencies, state-owned public institutions; units under the armed forces; agencies of the Communist Party, political-social organizations, and occupational-political-social organizations, social organizations, social-occupational organizations, non-governmental organizations, projects, and international organizations located in Vietnam with civil servants, public officials, and employees assigned by the State to work within the state budget and receiving salaries from the state budget according to the salary table prescribed by the State; allowances for part-time village cadres at commune, ward, and town levels and part-time cadres at village and neighborhood levels as stipulated in Clause 3, Clause 4, Article 2 of Decree 121/2003/NĐ-CP dated October 21, 2003 of the Government on the system and policies for village cadres (hereinafter referred to as part-time village cadres) and adjustments to allowances for retired village cadres according to Decision 130-CP dated June 20, 1975 of the Council of Ministers and Decision No. 111-HĐBT dated October 13, 1981 of the Council of Ministers (hereinafter referred to as retired village cadres) as prescribed in Decree 184/2007/NĐ-CP; allowances for veterinary staff at village level according to Circular No. 1569/TTg-NN dated October 19, 2007 of the Prime Minister.

2. Based on the provisions of Decree 166/2007/NĐ-CP, Decree 184/2007/NĐ-CP, ministries, ministerial-level agencies, government agencies, and other central agencies (hereinafter referred to as ministries, central agencies) and provincial-level cities directly under the central government have the responsibility to organize, guide, and aggregate financial requirements and sources to implement the adjustment of the general minimum wage level, adjustment of allowances for retired village cadres, and adjustment of allowances for part-time village cadres of their agencies, units, and subordinate levels to submit to the Ministry of Finance according to specific provisions of this Circular.

3. Ministries, central agencies, People's Committees at all levels, budgetary units at all levels, and budget users have the responsibility to determine and allocate resources to implement the adjustment of the general minimum wage level and the budget support (if any) to pay new salaries to civil servants, public officials, and employees of their units and allowances to retired village cadres in accordance with the prescribed regulations and the provisions of this Circular.

4. Implementation, accounting, and settlement of funds for the adjustment of the general minimum wage level and allowances for retired village cadres shall be carried out in accordance with the prescribed regulations and the specific provisions of this Circular.

II. SPECIFIC PROVISIONS:

1. Regarding the determination of financial needs to implement the adjustment of the general minimum wage level as prescribed in Decree 166/2007/NĐ-CP and the adjustment of allowances for retired village cadres as prescribed in Decree 184/2007/NĐ-CP(hereinafter referred to as financial needs to implement Decree 166/2007/NĐ-CP, 184/2007/NĐ-CP):

a) The total number of civil servants, public officials, employees, and retired village cadres to determine financial needs to implement Decree 166/2007/NĐ-CP, 184/2007/NĐ-CP is the actual number present at the reporting time (the number present on January 1, 2008) and does not exceed the total number of positions allocated by the competent authority (or approved). For the number of part-time village cadres to determine the level of support from the central budget, it is based on the position specified in Clause 3 and Clause 4, Article 2 of Decree 121/2003/NĐ-CP, each position is supported by the central budget not exceeding one cadre.

For additional positions in 2008 compared to the reporting time (if any), if within the total number of positions allocated by the competent authority (or approved), the additional financial needs to implement Decree 166/2007/NĐ-CP, 184/2007/NĐ-CP for these positions will be aggregated and reported to the Ministry of Finance by ministries, central agencies, and provincial-level cities directly under the central government for consideration and resolution or included in the financial needs to implement the salary adjustment for the following year.

For positions exceeding the total number of positions allocated by the competent authority (or approved), the financial needs to implement Decree 166/2007/NĐ-CP, 184/2007/NĐ-CP for these positions will be self-funded by the agency or unit from available financial sources in accordance with the law; not included in the financial needs to implement Decree 166/2007/NĐ-CP, 184/2007/NĐ-CP of ministries, central agencies, and provincial-level cities directly under the central government.

The total number of positions allocated by the competent authority to specific ministries, central agencies, and provinces and centrally-administered cities shall be determined similarly to the provisions set forth in paragraphs 1.1.1 and 1.1.2, point 1.1, clause 1, section II of Circular No. 02/2005/TT-BTC dated January 6, 2005, issued by the Ministry of Finance on guiding the determination of requirements, sources, and methods for implementing salary reform for civil servants, public officials, and armed forces personnel (hereinafter referred to as Circular No. 02/2005/TT-BTC).

b) The financial requirement for implementing Decrees No. 166/2007/NĐ-CP and No. 184/2007/NĐ-CP mentioned in this Circular shall be determined based on the basic salary according to rank, grade, and position; subsistence allowance according to the prescribed system (excluding night shift pay, overtime pay, and allowances in absolute amounts), and contributions according to the prescribed system (social insurance, health insurance, trade union fees) and the additional minimum wage stipulated in Decree No. 166/2007/NĐ-CP compared to Decree No. 94/2006/NĐ-CP, based on the number of positions specified in point a above.

For the financial requirement for implementing Decrees No. 166/2007/NĐ-CP and No. 184/2007/NĐ-CP of provinces and centrally-administered cities, it includes additional funding for subsidies for retired village cadres and part-time village cadres; increased activity fees for People's Council representatives at all levels; additional funding for preschool teachers outside the staffing quota in villages, towns, and wards; additional funding for village-level health workers' salaries due to adjustments in the general minimum wage; and support funding to pay veterinary staff at the village level equivalent to one-third of the current minimum wage.

The financial requirement for implementing Decree No. 166/2007/NĐ-CP for part-time village cadres shall be determined based on the subsistence allowance stipulated in Decree No. 166/2007/NĐ-CP (VND 180,000 per month) increased from the amount stipulated in Decree No. 94/2006/NĐ-CP (VND 150,000 per month) based on the number of cadres specified in point a, clause 1, section II of this Circular.

The financial requirement for implementing Decree No. 184/2007/NĐ-CP for retired village cadres shall be determined based on the adjustment in additional subsidies between Decree No. 184/2007/NĐ-CP and the amount stipulated in Decrees No. 93/2006/NĐ-CP and No. 94/2006/NĐ-CP.

c) For ministries, central agencies, and provinces and centrally-administered cities with an increase in the number of positions as of December 31, 2007 compared to the number of positions present when reporting the financial requirement for adjusting the minimum wage in 2007 as stipulated in Decree No. 94/2006/NĐ-CP (within the total number of positions allocated or approved by the competent authority) and not yet addressed, the additional financial requirement for implementing the adjustment in the general minimum wage as stipulated in Decree No. 94/2006/NĐ-CP (hereinafter referred to as the financial requirement for implementing Decree No. 94/2006/NĐ-CP) for these positions in 2007 (up to December 31, 2007) shall be combined with the financial requirement for implementing Decrees No. 166/2007/NĐ-CP and No. 184/2007/NĐ-CP in 2008.

Additional wages due to the adjustment in the general minimum wage for employees not under the state's quota allocation and whose wages are included in the product cost as stipulated by units operating in public services such as transportation, land administration, geology, etc.; additional wages for employees in agencies and units that have implemented budget allocations (such as Tax Departments, Customs Departments, State Treasury, Vietnam Television, State Bank of Vietnam, etc.) and in decisions allowing budget allocations where the competent authority has stipulated that the unit must arrange within the allocated budget to ensure new policies and regulations; additional wages for staff and employees of the trade union system at all levels: Shall be implemented similarly to the provisions set forth in point 1.2, clause 1, section II of Circular No. 02/2005/TT-BTC (not included in the financial requirement for implementing the adjustment in the general minimum wage for ministries, central agencies, and provinces and centrally-administered cities).

2. Regarding the determination of sources to ensure the financial requirement for implementing Decree No. 166/2007/NĐ-CP and Decree No. 184/2007/NĐ-CP (hereinafter referred to as the financial source for implementing Decree No. 166/2007/NĐ-CP and Decree No. 184/2007/NĐ-CP):

a) Principles for using financial resources in 2008 to implement Decree No. 166/2007/NĐ-CP and Decree No. 184/2007/NĐ-CP: Shall be implemented similarly to the provisions set forth in point 2.1, clause 2, section II of Circular No. 02/2005/TT-BTC.

b) Financial sources for implementing Decree No. 166/2007/NĐ-CP and Decree No. 184/2007/NĐ-CP in 2008:

b1) Financial sources for implementing Decree No. 166/2007/NĐ-CP in 2008 for ministries and central agencies:

- For administrative state agencies, party organizations, and mass organizations:

+ Utilize a minimum of 40% of the revenue retained according to the 2008 regime (the remaining portion after having been used to implement Decree No. 94/2006/NĐ-CP dated September 7, 2006, in 2008).

+ Utilize the savings from reducing 10% of regular expenses in the 2008 budget (excluding salaries and salary-like increases in 2007 according to the general minimum wage stipulated in Decree No. 94/2006/NĐ-CP and the salary system stipulated in Decree No. 204/2004/NĐ-CP) compared to the 2007 budget (the 2007 budget includes the budget allocated by the competent authority and the supplementary budget for salary increases according to Decree No. 94/2006/NĐ-CP – if applicable) for each agency.

+ Any unused funds from salary reform in 2007 shall be carried over to 2008.

- For state-owned public institutions and those affiliated with the party and mass organizations:

+ Utilize at least 40% of the retained revenue under the 2008 regime; specifically for the healthcare sector, 35%, after deducting drug costs, blood, transfusion fluids, chemicals, replacement materials, consumable supplies (the remaining portion after having been used to implement Decree No. 94/2006/NĐ-CP dated September 7, 2006, Decree No. 118/2005/NĐ-CP dated September 15, 2005, Decree No. 204/2004/NĐ-CP dated December 14, 2004, and Decree No. 03/2003/NĐ-CP dated January 14, 2003 in 2008).

+ Utilize the 10% savings from regular expenditure budgeted for 2008 (excluding salaries, including salary increases compared to 2007 based on the minimum wage level stipulated in Decree No. 94/2006/NĐ-CP and the salary system stipulated in Decree No. 204/2004/NĐ-CP), which exceeds the budget estimate for 2007 (the 2007 budget includes the authorized budget allocation and additional funding for implementing salary increases according to Decree No. 94/2006/NĐ-CP – if applicable) for each public institution.

+ Any unused funds from salary reform in 2007 shall be carried over to 2008.

In cases where the sources specified in paragraph b1 point b Clause 2 Section II above are less than the actual financial needs to implement Decree No. 166/2007/NĐ-CP in 2008 as stipulated in Clause 1 Section II of this Circular, the central government budget will supplement the shortfall for the ministries and central agencies to ensure sufficient funds for implementation.

In cases where the sources specified in paragraph b1 point b Clause 2 Section II above exceed the actual financial needs to implement Decree No. 166/2007/NĐ-CP in 2008 as stipulated in Clause 1 Section II of this Circular, the ministries and central agencies shall self-fund the implementation of Decree No. 166/2007/NĐ-CP in 2008 as stipulated in Clause 1 Section II of this Circular; the remaining amount shall be used for implementing new salary increases when further regulations are issued by the State; such remaining funds shall not be used for other purposes.

b2) The financial resources for implementing Decrees No. 166/2007/NĐ-CP and No. 184/2007/NĐ-CP in 2008 of the provinces and centrally-administered cities:

- Utilize the 10% savings from regular expenditure budgeted for 2008 (excluding salaries, including salary increases compared to 2007 based on the minimum wage level stipulated in Decree No. 94/2006/NĐ-CP and the salary system stipulated in Decree No. 204/2004/NĐ-CP), which exceeds the budget estimate for 2007 (the 2007 budget includes the authorized budget allocation and additional funding for implementing salary increases according to Decree No. 94/2006/NĐ-CP – if applicable).

- Utilize any surplus (if any) after ensuring the financial needs to implement Decrees No. 93 and No. 94/2006/NĐ-CP in 2008 from the following sources:

+ 50% of the increase in local government revenue (excluding the increase from land use fees) budgeted for 2008 compared to the 2007 budget approved by the Prime Minister;

+ 50% of the increase in local government revenue (excluding the increase from land use fees) realized in 2007 compared to the 2007 budget approved by the Prime Minister;

+ 10% savings from regular expenditure (excluding salaries, including salary components) budgeted for 2007;

+ 40% of the retained revenue under the administrative and public institution regimes in 2008 (specifically for the healthcare sector, 35%, after deducting drug costs, blood, transfusion fluids, chemicals, replacement materials, consumable supplies);

+ The remaining funds allocated for additional salary payments in 2007 that were not fully utilized;

+ The amount allocated from the state budget in the 2008 budget to ensure additional funding according to the salary levels stipulated in Decrees No. 93 and No. 94/2006/NĐ-CP (if applicable).

In cases where the sources specified in paragraph b2 point b Clause 2 Section II above are less than the actual financial needs to implement Decrees No. 166/2007/NĐ-CP and No. 184/2007/NĐ-CP in 2008 as stipulated in Clause 1 Section II of this Circular, the central government budget will supplement the shortfall for the provinces and centrally-administered cities to ensure sufficient funds for implementation.

In cases where the sources specified in paragraph b2 point b Clause 2 Section II above exceed the actual financial needs to implement Decrees No. 166/2007/NĐ-CP and No. 184/2007/NĐ-CP in 2008 as stipulated in Clause 1 Section II of this Circular, the provinces and centrally-administered cities shall self-fund the implementation of Decrees No. 166/2007/NĐ-CP and No. 184/2007/NĐ-CP as stipulated in Clause 1 Section II of this Circular; the remaining amount shall be used for implementing new salary increases when further regulations are issued by the State; such remaining funds shall not be used for other purposes.

3. Regarding the reporting system on the demand and financial resources for implementing Decrees No. 166/2007/NĐ-CP and No. 184/2007/NĐ-CP:

The ministries, central agencies, and the provinces and centrally-administered cities have the responsibility to organize, guide, review, and compile reports on the demand and financial resources for implementing Decrees No. 166/2007/NĐ-CP and No. 184/2007/NĐ-CP in 2008 to send to the Ministry of Finance no later than January 31, 2008 (including all ministries, central agencies, and provinces and centrally-administered cities with sufficient funds for salaries).

(The ministries and central agencies submit demand reports using Form No. 1, and source reports using Forms No. 3a, 3b, 3c attached; the provinces and centrally-administered cities submit demand reports using Forms No. 2a, 2b, 2c, 2d, and source reports using Forms No. 4a, 4b, 4c attached).

4. Regarding the method of disbursement for implementing Decrees No. 166/2007/NĐ-CP and No. 184/2007/NĐ-CP:

a) For units utilizing the state budget with financial resources for implementing Decrees No. 166/2007/NĐ-CP and No. 184/2007/NĐ-CP (10% savings from regular expenditure; 35-40% of the retained revenue under the regime) exceeding the actual financial needs to implement Decrees No. 166/2007/NĐ-CP and No. 184/2007/NĐ-CP, they may proactively use these resources to pay additional salaries to their staff members according to the prescribed regulations.

b) For Ministries, central agencies, provinces, centrally governed cities, and budget-using entities that have a need for funding to implement Decrees 166/2007/NĐ-CP and 184/2007/NĐ-CP greater than the funding provided under this Circular to implement Decrees 166/2007/NĐ-CP and 184/2007/NĐ-CP:

- Based on reports from Ministries, central agencies, and provinces, centrally governed cities, the Ministry of Finance will review and notify additional funding to ensure these Ministries, central agencies, and provinces have sufficient funds to implement Decrees 166/2007/NĐ-CP and 184/2007/NĐ-CP.

- On this basis, Ministries and central agencies will notify additional funding to their subordinate budget-using entities; local financial authorities at all levels will report to the People's Committees at the same level to notify additional funding to their own budgetary units and lower-level budgets to implement increased salaries for cadres, civil servants, and public officials according to the prescribed regulations (after using the funds to implement increased salaries as prescribed but still lacking funds).

- Based on the aforementioned notification of additional funding, local financial authorities at all levels will implement the withdrawal of the budget to execute and record it in the targeted supplementary budget for 2008 (which was not allocated in the initial budget); from 2009 onwards, it will be recorded in the balanced supplementary budget. The monthly withdrawal amount shall not exceed 1/12 of the total amount; for the first time, the amount withdrawn can be the total amount withdrawable according to the principle above for months from the beginning of the year until the date of withdrawal.

- Level I budgetary units are responsible for allocating the aforementioned additional funding notification to their subordinate budget-using entities (after using revenue and saving 10% of regular expenses but still lacking funds). Budget-using entities will withdraw money from the State Treasury within the scope of the additional funding, along with actively using retained revenue according to regulations and saving 10% of regular expenses to pay increased salaries for cadres, civil servants, and public officials of their own units according to the prescribed regulations.

c) For Ministries, central agencies, provinces, and centrally governed cities that have funding to implement Decrees 166/2007/NĐ-CP and 184/2007/NĐ-CP greater than the required funding to implement Decrees 166/2007/NĐ-CP and 184/2007/NĐ-CP:

- Ministries, central agencies, provinces, and centrally governed cities will direct and guide their units and directly subordinate budgets that have more funding than the required funding to implement Decrees 166/2007/NĐ-CP and 184/2007/NĐ-CP to proactively use these funds to pay increased salaries for cadres, civil servants, and public officials of their own units according to the prescribed regulations.

- Provinces and centrally governed cities will proactively use sources for salary payments as prescribed: increased local government revenue, saving 10% of regular expenses (the portion retained centrally) to supplement the funding to implement Decrees 166/2007/NĐ-CP and 184/2007/NĐ-CP for their own level budgetary units and directly subordinate budgets that lack funding to implement Decrees 166/2007/NĐ-CP and 184/2007/NĐ-CP according to the similar process specified in point b above.

d) Unused funds for adjusting the minimum wage in the year will be transferred to the following year to continue implementing salary reform, and surplus funds will not be used for other purposes; specifically:

- For budget-using entities: The entity must send a document to the State Treasury where transactions are conducted requesting the transfer of funds to the following year for continued use. The State Treasury will record the transfer to the following year based on the entity's request and report to the financial authority according to Circular 101/2005/TT-BTC dated November 17, 2005, issued by the Ministry of Finance, guiding the end-of-year accounting closure and annual budget settlement reporting.

- For budgets at all levels: Financial authorities will issue payment orders to transfer funds from the previous year to the following year. The State Treasury will record according to the financial authority's payment order.

đ) Accounting and settlement: The accounting and settlement of funds for implementing salaries, retirement benefits for retired village cadres, allowances for non-professional village cadres, and additional allowances for village veterinary officers shall be carried out in accordance with the provisions of the Law on State Budget and current laws and regulations.

III. IMPLEMENTATION:

1. Based on the provisions of this Circular, Ministries, central agencies, and provincial People's Committees, centrally governed city People's Committees are responsible for organizing and guiding agencies, units, and subordinate levels to determine the need for and funding to implement Decrees 166/2007/NĐ-CP and 184/2007/NĐ-CP in 2008.

Based on the specific situation of their own agencies and localities and the provisions of this Circular, Heads of Ministries, central agencies, provincial People's Committees, and centrally governed city People's Committees will stipulate the time and reporting forms for units and directly subordinate budgets that are consistent with the regulations on consolidation and reporting to the Ministry of Finance as prescribed in this Circular.

2. Determining, submitting reports, reviewing the need for funding, and implementing the payment of increased retirement pensions and social insurance benefits according to Decrees 166/2007/NĐ-CP and 184/2007/NĐ-CP for those who have retired and are receiving social insurance benefits guaranteed by the state budget will be guided by a separate circular.

3. This Circular takes effect 15 days after its publication in the Official Gazette. During implementation, if there are any difficulties, units are requested to report to the Ministry of Finance for prompt resolution./.