Deputy PM Vuong Dinh Hue (R) and WB Country Director for Vietnam Ousmane Dione (Source: VNA) Hanoi (VNA) –The World Bank (WB)’s expertshave suggested Vietnam promptly reform its social insurance sector systematicallyin order to ensure the balance between collection and spending in the mid-andlong-terms.
WB Country Director for Vietnam Ousmane Dione andother WB experts had a working session with Deputy Prime Minister Vuong DinhHue, who is also head of the central steering committee for reform of wage, socialinsurance and allowances for people with meritorious services, in Hanoi onApril 5.
According to the experts, Vietnam’s reforms in socialinsurance policy, which began in 2014, are not strong and visionary enough todeal with ongoing challenges.
They explained that the imbalance between collection andspending in Vietnam’s social insurance sector is expected to increase from 1.7percent at present to 3 percent in the future since there will be morebeneficiaries.
The total asset of the Vietnam Social Security (VSS) nowaccounts for 12 percent of the gross domestic product (GDP), the highest level.However, the value is forecast to drop to zero between 2036-2042.
At the same time, Vietnam’s retirement system isfacing many challenges due to the rapid aging population.
Given this, the experts proposed strengthening theState retirement system managed by the VSS, encouraging the involvement of theunofficial sector, developing a fundamental social retirement pension fund forpoverty reduction and gradually expanding the private retirement system.
Vietnam should raise retirement pension at a ratelower than that of the salary and adjust retirement pension in line withinflation, they said.
The retirement age should be increased and equalbetween men and women, the experts said, underling the need for Vietnam toreduce the retirement pension gap between the State and private sectors.
The experts also gave recommendations to Vietnam onensuring the stability of the financial system.
In reply, Deputy PM Hue said the WB’s assessmentswould help the Vietnamese Government complete a project on social insurancereform which will be submitted to the Politburo during the upcoming seventhplenum of the Party Central Committee.
The Deputy PM called on the WB to assist Vietnam intraining experts in financial forecasting, expressing his belief that with thesupport of the bank, Vietnam will successfully conduct the reform.-VNA
WB Country Director for Vietnam Ousmane Dione andother WB experts had a working session with Deputy Prime Minister Vuong DinhHue, who is also head of the central steering committee for reform of wage, socialinsurance and allowances for people with meritorious services, in Hanoi onApril 5.
According to the experts, Vietnam’s reforms in socialinsurance policy, which began in 2014, are not strong and visionary enough todeal with ongoing challenges.
They explained that the imbalance between collection andspending in Vietnam’s social insurance sector is expected to increase from 1.7percent at present to 3 percent in the future since there will be morebeneficiaries.
The total asset of the Vietnam Social Security (VSS) nowaccounts for 12 percent of the gross domestic product (GDP), the highest level.However, the value is forecast to drop to zero between 2036-2042.
At the same time, Vietnam’s retirement system isfacing many challenges due to the rapid aging population.
Given this, the experts proposed strengthening theState retirement system managed by the VSS, encouraging the involvement of theunofficial sector, developing a fundamental social retirement pension fund forpoverty reduction and gradually expanding the private retirement system.
Vietnam should raise retirement pension at a ratelower than that of the salary and adjust retirement pension in line withinflation, they said.
The retirement age should be increased and equalbetween men and women, the experts said, underling the need for Vietnam toreduce the retirement pension gap between the State and private sectors.
The experts also gave recommendations to Vietnam onensuring the stability of the financial system.
In reply, Deputy PM Hue said the WB’s assessmentswould help the Vietnamese Government complete a project on social insurancereform which will be submitted to the Politburo during the upcoming seventhplenum of the Party Central Committee.
The Deputy PM called on the WB to assist Vietnam intraining experts in financial forecasting, expressing his belief that with thesupport of the bank, Vietnam will successfully conduct the reform.-VNA
VNA
