Establish a National Housing Development Fund for Workers and People Under 35

Deputy Prime Minister Ho Duc Phoc chaired the meeting. (Photo: Van Diep/VNA)

The Ministry of Construction is in charge of “researching the establishment and setting up of an operating mechanism for state-owned enterprises specializing in investing in social housing development.” Currently, both central and local levels have financial institutions and preferential lending policies for social housing development, in addition to credit programs of the commercial banking system. However, the biggest problem in recent times is the limited source of preferential lending capital.

Therefore, to ensure feasible, fast and effective implementation, the Ministry of Finance proposes that instead of establishing a new financial institution, the existing system of financial institutions should be used to provide loans for social housing development, and recommends that the central and local governments prioritize resources and support mechanisms for these institutions to expand social housing lending activities.

In the draft Resolution of the National Assembly on piloting a number of specific mechanisms and policies for national social housing development, the Standing Committee of the National Assembly is expected to stipulate the establishment of a National Housing Development Fund to implement all three contents: Support for compensation and resettlement costs; investment in technical infrastructure and social infrastructure systems; and support for businesses investing in housing construction and beneficiaries of social housing policies.

The Government shall specify in detail the operating model, legal status, and annual budget sources.

Deputy Minister Ho Sy Hung also raised some difficulties in supporting funding for compensation, resettlement and investment in technical and social infrastructure systems when current laws on state budget and public investment do not have regulations allowing flexible use of public investment capital or regular funds to carry out compensation, support, resettlement, investment in technical and social infrastructure systems outside the scope of the project; difficulties in supporting social housing projects for rent and hire-purchase, there is no National Housing Development Fund or suitable financial institution model to support resources for implementing social housing projects.

“The Ministry of Finance has found that there is still no clear direction on the legal position of the Fund (central or local), especially the lack of clear resources for quick and effective implementation as directed by the Politburo. If the National Assembly is not asked to clarify this issue, the assignment of the Government to implement it will also have difficulties and obstacles,” said Deputy Minister Ho Sy Hung.

The Ministry of Finance presented two options on financial mechanisms to support social housing development and orientations for the establishment of a National Housing Development Fund. Option 1 is to establish a real Fund to perform three functions as being reported to the National Assembly.

Option 2 focuses on researching the establishment of a Housing Development Fund/organization to invest in social housing for rent and hire-purchase to solve current problems.

In which, the Ministry of Finance proposed to choose Option 2. At the meeting, representatives of the Ministry of Construction, the State Bank, the Ministry of Justice, and the Government Office exchanged and discussed the political basis, legal basis, and practical basis for establishing the fund; functions, tasks, organizational model, scale, service objects, governing body, fund establishment sources, etc. so that the fund can operate effectively, meeting the set goals and requirements.

Deputy Minister of Construction Nguyen Van Sinh stated that the issue of social housing development is a social policy, therefore the responsibility belongs to the state. The social housing development fund is one of the specific contents to support and promote the development of social housing in the coming period.

Deputy Governor of the State Bank Dao Minh Tu requested clarification of the resources for this fund, beneficiaries, fund management methods... He said he had studied the 120 trillion VND social housing development loan support package in depth and found that the number of beneficiaries was still modest.

Explaining the reason why this credit package has "stuck points" and has not yet entered life, he said that the resource issue is not the key, it is necessary to review the policy mechanism, closely assess the supply-demand situation, and "catch the right pulse."

Concluding the meeting, Deputy Prime Minister Ho Duc Phoc stated that the establishment of a housing development fund to carry out the task of developing social housing, housing for workers, people under 35 years old to rent or buy houses... has a political basis, a legal basis and a practical basis. Therefore, the fund's name was unified as "National Housing Development Fund."

This is an extra-budgetary state fund, established by the state (not overlapping with state budget expenditure tasks).

It is expected that the resources of the National Housing Development Fund will be mobilized from the following sources: State budget; mobilized from voluntary contributions of domestic and foreign investors; revenue from 20% land fund for building social housing in commercial housing projects according to regulations; mobilized contributions from organizations and individuals; and other legal sources.

The main function of the National Housing Development Fund is to invest in developing social housing, rental housing for workers; housing for young people under 35 years old... The National Housing Development Fund has 2 levels. The central level is managed by the Ministry of Construction; at the local level, it is managed by the Provincial People's Committee.

The Deputy Prime Minister assigned the Ministry of Construction to absorb the opinions expressed at the meeting to complete the Project to establish the National Housing Development Fund and the draft Decree to submit to competent authorities for consideration and decision./.

According to VNA

Source: https://baothanhhoa.vn/thanh-lap-quy-phat-trien-nha-o-quoc-gia-cho-cong-nhan-va-nguoi-duoi-35-tuoi-246409.htm