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PM supports HCMC’s proposal to raise budget retention rate

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HCMC – Prime Minister Pham Minh Chinh has thrown his full support behind a proposal of the HCMC government to increase its budget retention rate from the current 18% to 23% in the 2022-2025 period.

Chinh said the support for a higher retention rate would encourage the city to focus on three breakthrough strategies.

At a meeting between the Government’s delegation and the HCMC government on May 13, the HCMC government proposed the Government and the prime minister remove bottlenecks in special policies, equitization, mid-term public investment and some major projects in the city.

HCMC chairman Nguyen Thanh Phong said although the city makes the largest contribution to the State budget, at 27%, its budget retention rate, which has been revised down from 23% to 18% in the 2017-2021 period, is the lowest in the country, the local media reported.

Therefore, the city has drawn up a plan on the budget retention rate adjustment for the 2022-2025 period, proposing the rate at 23%, equal to that of 2011-2016. Phong expected the central Government to approve the proposal this year so that the city has resources for its quick and sustainable development.

Phong noted that some articles in Decree 93/2001 on delegating authority over certain sectors to HCMC, issued 20 years ago, are no longer appropriate, so he proposed the Government assign the Ministry of Home Affairs to coordinate with other relevant ministries and agencies to work out an alternative decree.

As for the equitization of State-owned enterprises, Phong suggested the Government issue decisions on the list of State-owned enterprises which will undergo the equitization in the 2021-2025 period and a State-owned enterprise restructuring plan. Besides, the Government should issue a decree guiding the handover of the State capital representation right at enterprises.

The Government last month announced the city’s estimated capital for public investment of nearly VND156.5 trillion in the 2021-2025 period, including some VND127.7 trillion coming from the city’s budget and VND13.9 trillion from the State budget.

However, the city can allocate some VND218.6 trillion, so Phong proposed the Government adjust the estimated capital for the city’s mid-term public investment for the period to VND261.9 trillion.

Regarding Thu Duc City, the HCMC government expected the PM to direct the relevant ministries and agencies to cooperate with the city to come up with special policies for Thu Duc this quarter so that it can become a new driving force for the development of HCMC and the southern economic region as a whole.

The city also sought the prime minister’s permission for the adjustment of a project to develop infrastructure in the north of the city and complete the North-South axis road under the public-private partnership format in line with the Investment Law.

Speaking of the city’s performance, Phong said the city had chosen 2021 as the year to build the single-tier government structure and improve the investment environment.

The city has basically brought the Covid-19 pandemic under control while ensuring socio-economic growth.

The main economic indicators in the first four months of the year were higher than those in the same period last year. The city’s tax revenue reached VND140 trillion, meeting 38.4% of the full-year target, Phong reported.

In the near future, the city will continue combating the pandemic by launching pandemic safety criteria, taking samples for Covid-19 testing on a larger scale and tightening control over those in centralized quarantine centers and at home.

In response, PM Chinh said the Government basically agreed with the city’s proposals, adding that the Government and the city would jointly remove obstacles.

The Government leader also said Resolution 54, which allows the city to embrace a special mechanism on a pilot basis, needed to be reviewed and supplemented with necessary policies.

The Government will create the most favorable conditions for HCMC to gain stronger growth, he noted.

The prime minister affirmed HCMC is the leading economic hub in the country, which is proved by its population and contribution to the country’s gross domestic product. The Government also acknowledged and highly valued its impressive achievements, Chinh said.

He especially hailed the city for its Covid-19 response.

Despite affirming that the city has reached the dual goals of fighting the pandemic and ensuring stable socioeconomic development, the PM asked municipal leaders to continue being on high alert to prevent the resurgence of the pandemic in the city.

Nevertheless, Chinh also pointed out some shortcomings, of which, the biggest is that the city has yet to develop in line with its role, position and advantages.

He said there were both objective and subjective reasons for the problem, but mainly subjective ones, which the Government and the HCMC authorities must be responsible for.

PM Chinh asked the city to convert from a defense stance to an offense one to deal with all the issues in all the sectors.

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