Circular No. 46/2019/TT-BTC guides the determination of needs, sources, and methods of expenditure to implement the adjustment of the minimum wage base according to Decree No. 38/2019/NĐ-CP dated May 9, 2019, and the monthly allowance adjustment for retired village cadres according to Decree No. 44/2019/NĐ-CP dated May 20, 2019 of the Government.

CIRCULAR

Guidelines for determining needs, sources, and methods of expenditure to implement adjustments to the minimum wage base according to Decree No. 38/2019/NĐ-CP dated May 9, 2019, and adjustments to monthly allowances for retired village cadres according to Decree No. 44/2019/NĐ-CP dated May 20, 2019 of the Government

Pursuant to Decree No. 38/2019/NĐ-CP dated May 9, 2019 of the Government stipulating the minimum wage base for cadres, civil servants, public officials, and armed forces;

Pursuant to Decree No. 44/2019/NĐ-CP dated May 20, 2019 of the Government adjusting pensions, social insurance allowances, and monthly allowances;

Pursuant to Decree No. 87/2017/NĐ-CP dated July 26, 2017 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

Implementing Decision No. 579/QĐ-TTg dated April 28, 2017 of the Prime Minister on principles of targeted assistance from the central budget to local budgets for implementing social welfare policies during the period 2017-2020;

At the proposal of the Director of the State Budget Department;

The Minister of Finance issues this Circular guiding the determination of needs, sources, and methods of expenditure to implement adjustments to the minimum wage base according to Decree No. 38/2019/NĐ-CP dated May 9, 2019, and adjustments to monthly allowances for retired village cadres according to Decree No. 44/2019/NĐ-CP dated May 20, 2019 of the Government.

Article 1. General Provisions

This Circular stipulates the procedures for determining requirements, sources, and methods of expenditure to implement:

Article 1. Adjustments to the minimum wage base for individuals working in agencies, organizations, and units as prescribed in Decree No. 38/2019/NĐ-CP dated May 9, 2019 of the Government stipulating the minimum wage base for cadres, civil servants, public officials, and armed forces (hereinafter referred to as Decree No. 38/2019/NĐ-CP).

Article 2. Adjustments to the subsidy fund for non-professional staff at commune, village, and neighborhood levels according to the quota prescribed in Decree No. 34/2019/NĐ-CP dated April 24, 2019 of the Government amending and supplementing certain provisions regarding commune-level cadres and civil servants and non-professional staff at commune, village, and neighborhood levels.

Article 3. Adjustments to allowances for retired village cadres according to Decision No. 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 as prescribed in Decree No. 44/2019/NĐ-CP dated May 20, 2019 of the Government adjusting pensions, social insurance allowances, and monthly allowances (hereinafter referred to as Decree No. 44/2019/NĐ-CP).

Article 2. Determination of financial needs for adjusting the minimum wage base according to Decree No. 38/2019/NĐ-CP and adjusting allowances for retired village cadres according to Decree No. 44/2019/NĐ-CP

Clause 1. Cadres, civil servants, public officials, and workers subject to adjustment of the minimum wage base shall be implemented according to the guidelines set out in Circular No. 04/2019/TT-BNV dated May 24, 2019 of the Minister of Home Affairs guiding the implementation of the minimum wage base for those receiving salaries and allowances in state-owned institutions, organizations, and public service units of the Party, State, political-social organizations, and associations, and other relevant documents from competent authorities. Among which, it is recommended to pay attention to the following contents:

Point a) The total number of cadres, civil servants, public officials, and workers to determine the financial needs for adjusting the minimum wage base is the actual number present on July 1, 2019 within the scope of the authorized staffing quota assigned (or approved) by the competent authority. The total authorized staffing quota assigned (or approved) by the ministries, central agencies, and provincial-level cities based on the following grounds:

- For the staffing quota of ministries and central agencies: staffing quotas of the National Assembly's agencies, Supreme People's Court, Supreme People's Procuracy, State Audit Office according to the Resolution of the Standing Committee of the National Assembly; staffing quota of the President's Office according to the Decision of the President; staffing quotas of central-level Party organizations and political-social organizations according to the notification of the Central Organization Department; staffing quotas of the Ministry of Defense and Ministry of Public Security according to the decision of the competent authority; administrative staffing quotas, the number of people working in public service units self-financing part of their regular expenses and public service units fully financed by the State of other ministries and central agencies according to the decision assigned by the Ministry of Home Affairs.

- For the staffing quota of provincial-level cities: administrative staffing quotas assigned by the Ministry of Home Affairs; the number of people working in public service units approved by the Provincial People's Council in accordance with the law; staffing quotas of local Party organizations and political-social organizations according to the notification of the Central Organization Department. Specifically, the staffing quota for commune-level cadres and civil servants is determined within the authorized staffing quota as prescribed in Clause 1, Article 4 of Decree No. 92/2009/NĐ-CP dated October 22, 2009 of the Government amended and supplemented in Clause 1, Article 2 of Decree No. 34/2019/NĐ-CP dated April 24, 2019 of the Government amending and supplementing certain provisions regarding commune-level cadres and civil servants and non-professional staff at commune, village, and neighborhood levels.

Point b) Do not aggregate the number of individuals exceeding the authorized staffing quota assigned (or approved) in 2019; agencies and units are responsible for handling excess staffing quotas in accordance with the law.

Point c) Do not aggregate the number of individuals working under the contract system as prescribed in Clause 4, Article 2 of Decree No. 38/2019/NĐ-CP; agencies and units allocate from the state budget allocation and other legitimate sources to pay for these individuals.

Clause 2. Financial needs for adjusting the minimum wage base according to Decree No. 38/2019/NĐ-CP for the subjects mentioned in Clause 1 of this Article are based on the increased amount of the minimum wage base; salary coefficients according to rank, grade, and position; salary allowance coefficients according to the prescribed system (excluding night shift wages, overtime wages, and allowances defined by absolute amounts), the ratio of contributions according to the system (social insurance, unemployment insurance, health insurance, trade union fees). In which, the method of determining the salary and allowances is carried out according to the guidance of the Ministry of Home Affairs and other competent authorities.

At the same time, it includes the additional financial requirements due to the adjustment of the minimum wage level to implement the following policies and regulations:

a) Paying health insurance for the relatives of officers, professional soldiers, non-commissioned officers, and soldiers in the Ministry of National Defense; relatives of workers and civil servants in national defense units funded by the state budget; relatives of officers, non-commissioned officers, and soldiers in the Ministry of Public Security; and relatives of personnel engaged in confidential work.

b) The responsibility allowance for members of various levels of the Party Committee according to Decision No. 169-QĐ/TW dated June 24, 2008 of the Politburo; the monthly subsidy for serving activities of the provincial-level Party Committee according to Decision No. 09-QĐ/VPTW dated September 22, 2017 of the Central Party Office.

c) Activity fees for representatives of all levels of People's Councils.

d) Supporting the allowance fund for those who engage in part-time activities at communes, wards, towns, villages, and residential areas based on the allocation from the state budget.

3. The financial requirements of provinces and centrally-administered cities include the portion of the state budget allocated to implement the policy of streamlining the establishment, early retirement policy, and retirement waiting period policy for individuals managed by localities according to Decree No. 108/2014/NĐ-CP dated November 20, 2014 of the Government on the policy of streamlining the establishment, Decree No. 113/2018/NĐ-CP dated August 31, 2018 of the Government amending and supplementing certain articles of Decree No. 108/2014/NĐ-CP dated November 20, 2014 of the Government on the policy of streamlining the establishment (hereinafter referred to as Decree No. 113/2018/NĐ-CP), Decree No. 26/2015/NĐ-CP dated March 9, 2015 of the Government stipulating the system and policies for cadres not reaching the age for re-election or re-appointment during their term in the organs of the Communist Party of Vietnam, State, and political-social organizations (hereinafter referred to as Decree No. 26/2015/NĐ-CP), and guiding documents of competent authorities.

4. The financial requirements for adjusting the increased allowances for retired village cadres are determined based on the actual number of beneficiaries present as of July 1, 2019, the increased allowance levels prescribed in Article 2 of Decree No. 44/2019/NĐ-CP, and the guidance provided in Circular No. 09/2019/TT-BNV dated June 14, 2019 of the Minister of Home Affairs guiding the implementation of the adjustment of the monthly allowance from July 1, 2019 for retired village cadres according to Decision No. 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.

5. The financial requirements for implementing allowance and subsidy systems calculated based on salary grades, ranks, or the minimum wage level, as issued by the Government, Prime Minister, and guiding documents of central ministries and agencies after July 1, 2019 (if applicable) will be consolidated into the financial requirements for implementing the salary reform in 2019 and processed according to the provisions of this Circular.

Article 3. Determination of the Financial Source for Adjusting the Minimum Wage Level According to Decree No. 38/2019/NĐ-CP and Adjusting Allowances for Retired Village Cadres According to Decree No. 44/2019/NĐ-CP

1. The financial source for implementing Decree No. 38/2019/NĐ-CP in 2019 for central ministries and agencies:

a) For state administrative agencies, the Party, and mass organizations:

- The remaining funds from the salary reform up to the end of 2018 that have not been used and transferred to 2019 (if any).

- Utilizing at least 40% of the retained earnings under the 2019 regime (the remainder after using to adjust the minimum wage level from VND 1,210,000/month to VND 1,390,000/month). The scope of retained earnings utilization shall follow the guidance provided in Clause 3 of this Article.

- Utilizing the savings from reducing 10% of regular expenses (excluding salary, allowances based on salary, items with salary nature, and human resource-related expenses) in the 2019 budget compared to the 2018 budget as assigned by the competent authority.

b) For public service units:

- The remaining funds from the salary reform up to the end of 2018 that have not been used and transferred to 2019 (if any).

- Utilizing at least 40% of the retained earnings under the 2019 regime (the remainder after using to adjust the minimum wage level to VND 1,390,000/month). Specifically, for earnings from providing medical examination, treatment, preventive healthcare, and other healthcare services by public healthcare facilities, at least 35% must be utilized. The scope of retained earnings utilization shall follow the guidance provided in Clause 3 of this Article.

- Utilizing the savings from reducing 10% of regular expenses (excluding salary, allowances based on salary, items with salary nature, and human resource-related expenses) in the 2019 budget compared to the 2018 budget as assigned by the competent authority.

c) The central government will supplement the financial sources for central ministries and agencies when the aforementioned financial sources are less than the required financial resources for adjusting the minimum wage level as stipulated in Article 2 of this Circular.

2. The financial source for implementing Decree No. 38/2019/NĐ-CP and Decree No. 44/2019/NĐ-CP in 2019 for provinces and centrally-administered cities:

a) The financial source:

- Utilizing the savings from reducing 10% of regular expenses (excluding salary, allowances based on salary, items with salary nature, and human resource-related expenses) in the 2019 budget compared to the 2018 budget as assigned by the Ministry of Finance's decision on the budget allocation.

- Utilizing 50% of the increased local government revenue (excluding land use fees and lottery revenues) compared to the 2018 budget as assigned by the Prime Minister.

- Utilizing 50% of the reduced state budget expenditure on regular operations in the administrative sector (due to the implementation of establishment streamlining and organizational restructuring for efficient operation) and public service units (due to the implementation of organizational and management system reforms for improved quality and efficiency).

- Utilizing the remaining funds from the salary reform in 2018 that have not been used and transferred (if any).

- Utilizing the surplus (if any) after ensuring the requirement to adjust salaries to the minimum wage level of VND 1,390,000/month from the following sources:

+ Save 10% of regular expenditures (excluding salary expenses, allowances based on salary, items with the nature of salary, and expenses for personnel according to regulations) in the budget estimate for 2017 as per the Decision allocating the budget of the Ministry of Finance.

+ Save 10% of regular expenditures (excluding salary expenses, allowances based on salary, items with the nature of salary, and expenses for personnel according to regulations) in the increased budget estimate for 2018 compared to the budget estimate for 2017 as per the Decision allocating the budget of the Ministry of Finance.

+ Use at least 40% of the retained revenue according to the regime in 2019; specifically, for the revenue from providing medical examination, treatment, preventive healthcare, and other healthcare services by public health facilities, use at least 35%. The scope of retaining revenue shall be implemented in accordance with the guidance provided in Clause 3 of this Article.

+ Allocate 50% of the increased local government revenue (excluding land use fee revenue and lottery revenue) in the budget estimate for 2018 compared to the budget estimate for 2017 as assigned by the Prime Minister.

+ Allocate 50% of the increased local government revenue (excluding land use fee revenue and lottery revenue) in the budget estimate for 2019 compared to the budget estimate for 2018 as assigned by the Prime Minister.

b) The central budget supplements targeted funding to localities for the remaining funds after using the sources as stipulated in point a of Clause 2 of this Article.

c) For localities where the funding source as stipulated in point a of Clause 2 of this Article exceeds the funding requirement as stipulated in Article 2 of this Circular, such localities shall self-fund the excess; the surplus shall be used to offset the central budget support for implementing social welfare policies issued by the Central Government (reducing the corresponding central budget support according to the regulations) as stipulated in Clause 2 of Article 1 of Decision No. 579/QĐ-TTg dated April 28, 2017 of the Prime Minister regarding the principles of targeted support from the central budget to local budgets for implementing social welfare policies during the period 2017-2020.

3. The retained revenue as prescribed in Clauses 1 and 2 of this Article must ensure that direct costs for revenue collection activities, which have already been covered by the state budget, are not deducted. The scope and ratio of deductions from retained revenue (excluding entities under the provisions of Clause 4 of this Article) should pay attention to the following points:

a) For administrative agencies: use at least 40% of the retained fees (fees within the list of fees as prescribed by laws on fees and charges).

b) For public service units that partially self-finance regular expenditures and those fully financed by the State for regular expenditures:

- For retained fees (fees within the list of fees as prescribed by laws on fees and charges): use at least 40% of the retained revenue after deducting directly related costs to service provision and fee collection as prescribed by laws on fees and charges.

- For retained tuition fees (regular): use at least 40% of the retained revenue calculated based on the total tuition fees collected (including supplementary tuition fees funded by the state budget as prescribed).

- For retained revenue from providing medical examination, treatment, preventive healthcare, and other healthcare services by public health facilities: use at least 35% of the retained revenue after deducting costs already included in the service price as prescribed by laws on service pricing (such as drug costs, blood, transfusion fluids, chemicals, consumable materials, utilities, waste management, environmental sanitation, maintenance, repair, replacement of equipment, tools, and salaries and allowances included in the price).

- For retained revenue from service activities, joint ventures, and other revenues: use at least 40% of the revenue from these activities after deducting directly related costs included in the service prices and payments to the state budget as prescribed.

4. Administrative agencies authorized to implement financial autonomy mechanisms like public service units that partially self-finance regular expenditures or those fully self-financing regular expenditures; public service units that partially self-finance regular expenditures, public higher education institutions, continue to be authorized to implement autonomy in accordance with the spirit of Resolution No. 77/NQ-CP dated October 24, 2014 of the Government on piloting reforms in the operation of public higher education institutions during the period 2014-2017: Units may decide the proportion of revenue to be set aside to create sources for salary reform and self-funding salary adjustments from unit revenue, including unused funds for salary reform up to the end of 2018 (if any).

5. Funding for implementing Decree No. 38/2019/NĐ-CP for staffing and labor in the trade union system at all levels is guaranteed from the 2% trade union fund revenue; it is not consolidated into the funding requirements for salary and additional allowances of central ministries and agencies and provincial-level cities directly under the Central Government.

6. Funding for implementing Decree No. 38/2019/NĐ-CP for staffing and labor in the State Bank of Vietnam, Vietnam Social Security, and staff implementing unemployment insurance is guaranteed from the management budget according to regulations.

7. Funding for implementing Decree No. 38/2019/NĐ-CP for staffing and labor in agencies and units currently implementing cost-sharing arrangements, where the cost-sharing decision of the competent authority specifies that during the cost-sharing period, the agency or unit will arrange within the cost-sharing limit to ensure new policies and programs (for example, Tax Authorities, Customs Authorities, Vietnam Television), is guaranteed within the total allocated funding.

Article 4. Report on demand and funding sources for implementing Decree No. 38/2019/NĐ-CP and Decree No. 44/2019/NĐ-CP

Ministries, central agencies, and provinces and centrally-administered cities (including those that have ensured sufficient funding to implement) shall aggregate the demand and funding sources for implementing Decree No. 38/2019/NĐ-CP and Decree No. 44/2019/NĐ-CP, and submit them in writing to the Ministry of Finance no later than October 15, 2019, for review and supplementation of any insufficient funds according to regulations.

(Ministries and central agencies shall submit reports on demand and funding sources using forms No. 1, 3a, 3b, and 3c; provinces and centrally-administered cities shall submit reports on demand and funding sources using forms No. 2a, 2b, 2c, 2d, 2đ, 2e, 2g, 2h, 2Ỉ, 2k, 21, 4a, and 4b issued together with this Circular).

Article 5. Method of disbursing funds for implementing Decree No. 38/2019/NĐ-CP and Decree No. 44/2019/NĐ-CP

1. Ministries and central agencies shall direct and guide units to proactively utilize available sources as prescribed to disburse additional salary payments to civil servants, public officials, civil servants, and workers in accordance with the stipulated regulations.

2. For provinces and centrally-administered cities with larger funding sources than the required budget for implementing Decree No. 38/2019/NĐ-CP and Decree No. 44/2019/NĐ-CP, localities shall proactively use increased local revenue, save 10% of regular expenditures (the portion retained centrally), to supplement the budget for budgetary units at the same level and subordinate budgets that lack funding.

3. For difficult areas requiring more funding to implement the provisions of Decree No. 38/2019/NĐ-CP and Decree No. 44/2019/NĐ-CP than the prescribed funding under this Circular:

While awaiting authorized bodies to supplement funding, higher-level budgets shall temporarily allocate funds to lower-level budgets that lack funding. The temporarily allocated funds will be deducted when authorized bodies officially supplement the implementation funding. Units utilizing the budget may proactively use the 2019 budget allocation and retained revenue according to regulations to promptly pay additional salaries, allowances, and subsidies to the specified groups as stipulated in this Circular. Difficult areas shall send a document to the Ministry of Finance to request temporary funding for implementation.

4. Accounting and settlement: The accounting and settlement of funds for implementing salaries, allowances, and subsidies for the specified groups as stipulated in this Circular shall be carried out in accordance with the State Budget Law and other current legal documents.

Article 6. Implementation Organization

1. This Circular takes effect from September 6, 2019.

2. Circular No. 68/2018/TT-BTC dated August 6, 2018, of the Ministry of Finance guiding the determination of demand, sources, and methods of disbursing funds for implementing adjustments to the basic salary level according to Decree No. 72/2018/NĐ-CP dated May 15, 2018, and monthly allowances for retired village cadres according to Decree No. 88/2018/NĐ-CP dated June 15, 2018, of the Government shall cease to be effective from the date this Circular takes effect.

3. In cases where the legal normative documents cited in this Circular are amended, supplemented, or replaced by other legal normative documents, the provisions of the amended, supplemented, or replacing documents shall apply.

4. Based on the provisions of Decree No. 38/2019/NĐ-CP, Decree No. 44/2019/NĐ-CP, and the guidance provided in this Circular, ministries, central agencies, and provinces and centrally-administered cities shall be responsible for:

a) Organizing, guiding, and aggregating the demand and funding sources for adjusting the basic salary levels of agencies, units, and subordinate levels; adjusting the allowance fund for non-professional staff at the commune, village, and residential ward levels according to the quota; adjusting monthly allowances for retired commune cadres, and submitting to the Ministry of Finance in accordance with this Circular.

b) Determining and allocating full and timely funding sources to pay the specified groups in accordance with the stipulated regulations and guidance in this Circular, including: new salaries for civil servants, public officials, civil servants, armed forces personnel, and other groups; allowances for retired commune cadres; allowances for non-professional staff at the commune, village, and residential ward levels.

c) Based on the specific situation of the agency or locality, they shall specify the time frame and reporting forms for units and subordinate budget levels in accordance with the regulations on aggregation and reporting to the Ministry of Finance as stipulated in this Circular.

During the implementation process, if there are any difficulties, ministries, central agencies, and provinces and centrally-administered cities shall report to the Ministry of Finance for prompt consideration and resolution./.