Hanoi (VNA) – Lawmakers on August 19 supported the consolidation of the Law on State Budget 2025 and the Law on Public Investment 2024, particularly following the merger of the Ministry of Finance and the Ministry of Planning and Investment.
The deputies shared such consensus during a group discussion on the orientation for drafting the Law on State Budget (consolidated) held as part of the 16th National Assembly (NA)’s first extraordinary session. The consolidation is seen as a major step towards reducing administrative procedures and supporting socio-economic development.
According to Prime Minister Le Minh Hung, the two laws were recently amended and supplemented to institutionalise a number of policy directions set out in the Politburo’s strategic resolutions and address difficulties arising from the implementation of the two-tier local administration model.
However, their implementation has continued to reveal shortcomings, overlaps and areas of interaction between the two. In reality, all of these activities use State budget funds, meaning there is no need to maintain two separate laws, he said. They should instead be consolidated to resolve overlapping provisions and simplify procedures.
The leader said the Government has submitted a proposal to the NA Standing Committee and received approval in principle for the merger of the five-year financial plan and State budget estimates with the five-year public investment plan. Integrating these components is highly appropriate, he noted. The draft law also proposes combining the annual public investment plan and annual State budget estimates into a single plan, thereby establishing unified principles, criteria and spending norms for both recurrent and investment expenditure, he noted.
Highlighting the overall approach of cutting and simplifying administrative procedures while maintaining strict inspection and supervision, the PM said all State budget expenditure, including public investment and recurrent spending, must be assessed in terms of overall effectiveness based on substantive outputs, rather than purely on economic efficiency.
This is particularly important because many projects are also linked to national defence and security, ethnic affairs and religious matters, he said.
NA President Tran Thanh Man stressed that the drafting of the consolidated Law on State Budget must embrace innovation and breakthrough measures to drive national development. The top legislator outlined three requirements for the amendments. First, they must address the rigid integration. Second, barriers between recurrent and investment expenditure must be removed, including the current inability to use recurrent expenditure for minor repairs and upgrades to public assets or for preparing investment projects. Third, the revised framework must be compatible with the consolidation of national target programmes.
The NA President called for a shift towards results-based budget management, moving from allocating funds based on input documentation to allocating capital according to key performance indicators (KPIs) and actual outputs.
It is necessary to complete the medium-term expenditure framework by linking the five-year financial plan and the medium-term public investment plan with annual budget estimates, in order to limit fragmented and impractical budget planning,” he noted.
Commenting on the orientation for drafting the law, NA Vice President Nguyen Khac Dinh said the task should not simply involve merging the two laws into a new piece of legislation. Instead, it should establish a more effective and comprehensive governance framework for managing both the State budget and public investment.
This should include a unified process for preparing financial and investment plans while ensuring consistency with other relevant laws, including those on public debt management, public-private partnership (PPP) investment, and construction as well as the public finance plan./.
