Amendments and additions to regulations on the management and use of local budget funds entrusted through the Social Policy Bank.

Accordingly, the Circular not only focuses on unifying the management of capital at the provincial level to align with the two-tiered government organizational model, but also provides more specific and clearer regulations on interest rates, management fees, mechanisms for establishing and handling credit risks, in order to improve efficiency and ensure the safety of this important social security fund.

Circular No. 84/2025/TT-BTC of the Ministry of Finance stipulates that provincial budget funds allocated annually (depending on the actual situation of each locality and the ability to balance the budget) are entrusted to provincial branches of the Social Policy Bank to provide loans to the poor and other policy beneficiaries as decided by the Provincial People's Council.

To implement this, the Circular also specifies the specialized agency assigned by the Provincial People's Committee to sign entrustment contracts with the provincial branch of the Social Policy Bank.

The aforementioned regulations have been amended to align with the implementation of the two-tiered local government model operating from July 1, 2025, when there will only be two levels: provincial and commune. Therefore, the regulations have been revised to remove the authority of the district level.

For funds that were entrusted by the district budget through the Social Policy Bank before the change in the administrative organizational model, Circular No. 84/2025/TT-BTC also outlines a clear transfer roadmap.

Accordingly, for district-level budget funds entrusted through the Social Policy Bank, the funds will be transferred to the provincial branch of the Social Policy Bank to continue lending. The specialized agency assigned by the Provincial People's Committee will sign an entrustment contract with the provincial branch of the Social Policy Bank to continue monitoring and managing the funds.

Circular No. 84/2025/TT-BTC also grants local authorities more autonomy in developing specific lending policies that are appropriate to their actual conditions.

Regarding the handling of risky debts, Circular No. 84/2025/TT-BTC clarifies that if the risk is due to objective reasons, the general mechanism stipulated by the Prime Minister shall apply. However, for other risky cases, the Circular empowers localities as stipulated by the Provincial People's Council. The authority to consider and handle risky debts rests with the Chairman of the Provincial People's Committee.

In cases where the reserve fund is insufficient to cover the losses, the Circular also provides a flexible handling mechanism: depending on the actual situation of the risky loan, the specialized agency assigned by the Provincial People's Committee to sign the entrustment contract will take the lead, coordinate with relevant departments and agencies and the provincial branch of the Social Policy Bank to report to the Provincial People's Committee to supplement the provincial budget for handling, or directly reduce the entrusted capital from the provincial budget transferred through the provincial branch of the Social Policy Bank.

Source: https://hanoimoi.vn/sua-doi-bo-sung-quy-dinh-ve-quan-ly-va-su-dung-von-ngan-sach-dia-phuong-uy-thac-qua-ngan-hang-chinh-sach-xa-hoi-713841.html