Why is it necessary to increase the social allowance standard to 500,000 VND from July 1?

Postal staff complete procedures for pensioners and social insurance beneficiaries in Hanoi - Photo: HA QUAN

The Ministry of Labor, War Invalids and Social Affairs is collecting opinions and finalizing a draft decree adjusting the social allowance standards prescribed in Decree 20 dated March 15, 2021 of the Government on policies to support social protection beneficiaries.

The draft proposes to increase the standard social allowance from 360,000 VND/month to 500,000 VND/month, an increase of 38.9%.

Increase social benefits to "catch up" with wage increases

According to the ministry, every year, the state budget spends more than 27,000 billion VND to implement social assistance policies and issue health insurance cards to social protection beneficiaries. Many policies reach vulnerable groups such as support for home repair, home building, rice for famine relief, etc.

However, the Ministry of Labor, War Invalids and Social Affairs assessed that the increase in social assistance standards is slower than the reform of social insurance policies, pensions, poverty reduction or subsidies for people with revolutionary contributions.

This standard is currently very low, only 24% of the rural poverty standard for the 2021-2025 period (the rural poverty standard is 1.5 million VND).

From 2021 to present, the standard level of preferential allowance for people with revolutionary contributions has increased by 26.5% (from VND 1,624 million to VND 2,055 million).

After 4 years, the basic salary increased by 20.8% from 1.49 million VND/month to 1.8 million VND/month.

It is expected that from July 1, the above policies will increase even more. For example, the standard allowance for meritorious people will increase by 35.7% from VND2,055 million to VND2,789 million. The basic salary will increase by 30% from VND1,8 million/month to VND2,34 million/month.

Thus, the preferential standard for meritorious people from 2021-2024 is expected to increase by 62.2%. The basic salary is expected to increase by 50.8%.

According to a report by the General Statistics Office and the Ministry of Planning and Investment, the consumer price index (CPI) for the 2021-2024 period is expected to increase by about 14%. Prices of consumer goods and services have increased, but social assistance levels have not changed, making life difficult for social protection beneficiaries.

The standard level of social assistance has not met the minimum living standards of the people, so many provinces and cities have had their own policies to increase the support level - Photo: HA QUAN

Proposal to increase social allowance standard to 500,000 VND/month

According to the drafting agency, if the social allowance standard is increased from VND360,000/month to VND500,000/month (an increase of 38.9%), the total budget for 2024 will be over VND32,000 billion. If implemented in the last 6 months of 2024, the resulting budget will be about VND4,700 billion.

With the standard social allowance of 500,000 VND/month, over 3.3 million people in the social protection group and 349,000 people receiving financial support for care will benefit.

Increasing the social allowance standard has many positive impacts, without increasing the payroll, the budget can be balanced, in accordance with the 2023 Constitution, Resolution 42 of the 13th Party Central Committee on innovation and improving the quality of social policies...

On June 21, the Government Office issued a document agreeing to apply the simplified procedures in developing and promulgating a decree adjusting social assistance standards. The Ministry of Labor, War Invalids and Social Affairs is responsible for the content of the report and proposal, ensuring compliance with regulations.

If approved by the Government, the regulation will take effect from July 1, 2024.

According to statistics from the Ministry of Labor, War Invalids and Social Affairs, there are over 3.3 million people (about 3.3% of the population) receiving monthly social benefits nationwide. Of these, 1.4 million people receive benefits for the elderly, 1.6 million people receive benefits for the disabled, and 21,000 children have lost their source of support...

Source: https://tuoitre.vn/vi-sao-can-tang-muc-chuan-tro-cap-xa-hoi-len-500-000-dong-tu-ngay-1-7-20240622110703773.htm