National Assembly members yesterday agreed that the issuance of Government bonds would continue helping the nation's basic construction needs but the focus for the next period would be on tightening investment and eliminating ineffective use of funding.
The live broadcast general session yesterday focused on the inspection report of the NA Standing Committee on the use of government bonds for capital construction during 2006-12.
According to the report, more than VND409.4 trillion (US$22.9 billion) in government bonds were allocated for nearly 2030 projects between 2006-12 in the areas of transportation, irrigation, health and education.
However, according to the NA Standing Committee, these projects were adjusted to the reported investment cost of about VND684.8 trillion ($32.58 billion).
While these projects have transformed the lives of millions and the faces of localities and cities nationwide, the report pointed out that wasteful management existed, due to factors such as ineffective development plans, projects not meeting deadlines and regulations not being enforced.
Most NA members called for the NA to strengthen its supervisory role in preventing the inefficient use of government bonds.
Nguyen Thanh Tam, an NA member from Tay Ninh Province, said the original goal of government bonds was to target the urgent needs in socio-economic development of some isolated and poor provinces but now it had been considered just another source of state funding.
"Some of the shortcomings in using government bonds have not been dealt with thoroughly in recent years, thus allowing some projects to hike their cost," he said.
NA member Phuong Thi Thanh from Bac Kan Province said the NA inspection report needed to better explain the reasons for hiking the cost, calling for increased inspection and punishments if necessary of those who violated and mismanaged government bonds, she added.
Some lawmakers called on the NA to focus on allocating government bonds in the period 2012-15 to unfinished and delayed projects and priority should be given to schools, downgraded hospitals, student dormitories of schools in mountainous provinces and Central Highlands' irrigation projects.
Agreeing with several NA members who asked that there must be clearer guidelines and criteria on allocating government bonds to provinces and localities, NA member Nguyen Dinh Quyen from Ha Noi said a mechanism must be built to make sure that there wasn't any "unfairness" among provinces.
"We can't allow the mindset that some provinces feel the money came from the sky," he said. "The target is for the isolated and poor provinces but statistics show that little more than 30 per cent is allocated for these provinces."
Nguyen Thi Kim Be, NA member from Kien Giang Province, said there must be an increased level of transparency among government-bond funded projects, similar to the strict rules given to ODA and state-funded projects.
Several cabinet members also gave grounds on the management of government bonds in their respective areas.
According to Agriculture and Rural Planning Minister Cao Duc Phat, part of the reasons for adjusted costs had to do with increased prices of materials due to inflation and new technical requirements to increase safety.
He asked that the NA carefully considered giving priorities to uncompleted projects in the sector, which were expected to need another VND10.2 trillion (nearly $0.5 billion) to allow all the projects to meet the deadline before 2015.
In terms of education, Deputy Prime Minister Nguyen Thien Nhan said the project to build new schools, classrooms and teachers' accommodation nationwide took an investment of VND24 trillion (about $1.1 billion from the government bonds) but the cost proved to be much higher, requiring additional funds from localities.
Between 2006-12, the education sector used government bonds to build 93,000 classrooms and help 3 million students, especially those in the mountainous areas, which lowered the dropout rate, according to Nhan.
Transport Minister Dinh La Thang said the ministry last year did not increase the reported investment cost of any project using government bonds, considering that the transport sector was in dire need of investment.
Minister of Health Nguyen Thi Kim Tien said the Ministry acknowledged all the suggestions of NA members. She said the ministry would submit a development plan of the entire health sector for government submission in the fourth quarter, which would redraw the development plan for hospitals nationwide.
Lan Tu Toan, director of Dak Lak Department of Construction, said he highly supported the policy of issuing government bonds since it was a critical source of funding for the province, for example to help build irrigation projects that allowed farmers there to increase quality and quantity of rice paddies and cope with drought.
