The National Assembly agreed to spend more than 9,650 billion VND to compensate for Nghi Son Oil Refinery

The 2024 central budget will allocate more than VND9,650 billion to offset the purchase price of Nghi Son Refinery's products, but the Government needs to review the data.

The resolution on central budget allocation for 2024 was just passed by the National Assembly on the afternoon of November 10 with nearly 90% of delegates in favor.

National Assembly deputies vote to pass the Resolution on November 10. Photo: Hoang Phong — National Assembly deputies vote to pass the Resolution on November 10. Photo: *Hoang Phong*

In particular, the National Assembly assigned the Government to review and accurately calculate the amount of compensation for the product consumption of the Nghi Son Refinery and Petrochemical Project (including the outstanding amount for 2018-2023 of VND 8,247 billion and the amount arising in 2024 of about VND 9,653 billion). This data must be determined by the State Audit before being submitted to the National Assembly. In urgent cases, the Government shall submit it between two sessions, and report to the National Assembly Standing Committee and the National Assembly at the nearest session.

According to the 2013 Government Guarantee Commitment (GGU) agreement, Vietnam Oil and Gas Group will purchase all of Nghi Son's products for 15 years, with a wholesale price equivalent to the import price at the same time plus an import tax incentive of 3-5-7% (ie plus 3% for petrochemical products, 5% for LNG and 7% for petroleum products). Within 10 years (until 2028), if Vietnam reduces the import tax to a level lower than the above incentives, PVN will be responsible for compensating Nghi Son Refinery for the difference.

Reporting and receiving before the delegates voted to approve the Resolution, Chairman of the Finance and Budget Committee Le Quang Manh said that some delegates suggested clarifying the allocation of compensation payments for the Nghi Son Oil Refinery project.

The National Assembly Standing Committee said that in 2023, the National Assembly has not yet decided to allocate the project of VND 8,247 billion to pay compensation for Nghi Son, and requested the Government to review and recalculate. But so far, the Government has not submitted it again, so this amount has not been allocated. The Standing Committee "urged" the Government to submit it again to the National Assembly soon, to consider and decide on the arrangement of payment sources.

Regarding the 2024 price compensation, about VND 9,653 billion, the National Assembly Standing Committee believes that this price compensation is an issue that has arisen for many years and needs to be handled so as not to violate Vietnam's commitments. The National Assembly Standing Committee proposed allocating this source of money in the 2024 central budget estimate for payment. However, the Government needs to review and determine the exact figures and the State Audit needs to audit this figure.

Also according to the Resolution, the division of environmental protection tax for 2024-2025 according to the Budget Law is based on the output of gasoline produced and sold domestically and the total output consumed in the market. Specifically, 60% is divided between the central and local budgets; the remaining 40% is regulated to the central budget.

Revenue from the lottery is spent on development investment, with priority given toeducation and training, vocational training (including purchasing teaching equipment for the textbook renewal program) and healthcare. The remainder is spent on urgent local budget tasks.

Revenue from road fees collected through automobile vehicles in 2024-2025 will be allocated 65% to the central budget, the remaining 35% will be allocated to supplement the local budget for road management and maintenance.

With the central budget in 2022 collected from administrative fines for traffic safety violations, the Ministry of Public Security will receive 85%. The rest will be allocated by the National Assembly to local authorities for other forces in the area to participate in ensuring traffic safety.

The resolution also allocates central budget revenue of VND852,682 billion; local budget revenue of VND848,305 billion. The remaining revenue transferred from local budget salary reform by the end of 2023, transferred to the 2024 budget estimate, is VND19,040 billion. This is to increase the basic salary to VND1.8 million per month from July 1, 2024.

Total central budget expenditure is nearly 1.22 million billion VND, of which nearly 35% is estimated to supplement the budget balance (including a 2% increase in the balance supplement compared to the 2023 estimate) and local budgets.

With the approved central budget revenue and expenditure, the National Assembly assigned the Government to pay off all outstanding debts for basic construction, allocate sufficient counterpart funds for ODA projects, foreign preferential loans, and budget for PPP projects. The Government also needs to allocate sufficient funds for projects that have been handed over and used before 2024; and recover the remaining advanced capital that must be collected in the 2021-2025 medium-term public investment plan.

"Financial discipline and order need to be tightened, and violations and obstructions that slow down capital allocation and disbursement must be strictly handled; and the responsibility of the head in case of slow disbursement must be individualized," the Resolution stated.

Mr. Minh

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