Humanitarian policy
Voluntary SI is a major policy of the Party and State, with profound human significance and has been implemented since January 1, 2008, as a part of our country's SI system. Over the past 12 years of implementation, the voluntary SI policy has been amended and supplemented with a number of terms to suit the reality, creating favorable conditions for people to access and participate in order to further improve the policy's humanitarian.
The voluntary SI policy helps those who have not participated in compulsory SI to have the opportunity to participate, especially those concentrates in rural areas where there are many traditional craft villages, individual non-agricultural business households, cooperative groups, freelance employees, shopowners, domestic workers, etc. Voluntary SI participants will be selected the payment level and payment method in accordance with their income. When participating in voluntary SI, employees are entitled to a monthly pension when they are eligible (this will reduce the burden on the State budget in paying monthly benefits to the elderly as currently). In addition, when participating in voluntary SI, employees are also entitled to lump-sum and death benefits according to regulations such as: Pension is adjusted on the basis of the increase in consumer price index and economic growth; being granted health insurance (HI) card when retiring with the payment rate of 95% (employees do not have to purchase household HI and the State budget also does not buy HI for the elderly); when the employee pays the voluntary SI premium from full 5 years or more, when he/she dies, his/her relatives will enjoy the lump-sum burial and death fee, etc. With its benefits, voluntary SI contributes to reduce difficulties, helps ensure income, stabilizes life, is a solid fulcrum for freelance employees when they get old, contributing to ensuring social security.
Voluntary SI participants are granted HI cards when they retire with the payment rate of 95%
According to statistics, after nearly 12 years of implementing voluntary SI, the country has 52,654 people enjoying pensions from the time of implementing the voluntary SI policy in 2008 up to now. This figure includes employees participating in compulsory SI and continuing to participate in voluntary SI to be eligible for pensions. The voluntary SI policy has been amended and supplemented with a number of terms such as: Deregulating maximum working age to participate in voluntary SI; deregulating the lowest income for voluntary SI contribution equalling to the common minimum salary (now the base salary), instead, regulating monthly income level selected by the voluntary SI participants with the lowest equalling to the poverty line in rural areas according to the Prime Minister's regulations and the highest is 20 times the base salary at the time of payment. Therefore, the participants of voluntary SI can select the appropriate rate of payment in accordance with their ability to participate as well as select the methods of voluntary SI payment (monthly payment, quarterly payment, 6 month payment, annual payment or maybe one-time payment for many years to come or one-time for the missing years to enjoy the voluntary SI). From April 2016, the Law on SI no. 58/2014/QH13 expanded the method of paying SI premiums for people who have reached the retirement age but the working time is insufficient (not more than 10 years), they are entitled to pay lump sum voluntary SI to enjoy pensions, the time of pension entitlement is counted from the 1st of the month following the month of paying the full amount for the insufficient years, etc.
The rate of participation remains low
According to statistics, as of June 30, 2020, Binh Duong province had 6,733 people participating in voluntary SI, accounting for 0.37% of the workforce in working age (according to figures of the Binh Duong provincial Statistics Office, the workforce is forecasted in the age group in 2020 will be 1,835,864 people). That situation shows that the coverage of people participating in voluntary SI in the province is still very low, employees participating in voluntary SI have increased but not commensurate with the potential compared to the workforce in the age group of the province.
Sharing about this issue, Mr. Pham Van Tuyen - Deputy Director of the Department of Labor, Invalids and Social Affairs, said that the majority of subjects participating in voluntary SI are freelancers, farmers with unstable jobs, irregular and low income, so it is difficult to join voluntary SI. While voluntary SI requires subjects to have a relatively stable income and a long participation period, after 20 years of participation, they will be only entitled to the benefits. In addition, the access to information of the groups participating in voluntary SI is still limited; awareness of policies and benefits when participating in voluntary SI of people is limited, mainly seeing short-term benefits, not seeing long-term benefits. As of June 30, 2020, only nearly 500 people participating in voluntary SI in the province can receive the pension benefits, therefore, the burden on the elderly without pensions whose state budget has to pay social protection support is huge. The Central budget that supports the payment rate for voluntary SI participants has only been implemented since January 1, 2018 and the support level is too low, not enough to "stimulate demand" for people to participate in the policy. There is no policy to support people participating in voluntary SI from the local budget.
Necessary to have local support policy
In 2020, the estimate assigned to Binh Duong province by Vietnam Social Security is 19,019 people participating in voluntary SI, so it is necessary to increase 12,286 participants. In addition, in the implementation of Resolution no. 15/2018/NQ-HDND dated November 30, 2018 of the provincial People's Council, there will be about 700 employees who are communal cadres and civil servants resign their jobs during arranging organizational apparatus, reducing the size of the workforce in the period 2019-2021. These commune-level cadres and civil servants have under 20 years of SI participation, up to the time they resign their jobs. Therefore, it is necessary to have provincial support policies so that these employees continue to participate in the voluntary SI to enjoy the retirement regime when they end of working age. In addition, the whole province has more than 720,000 employees of the age who have not participated in SI (according to figures as of December 31, 2019), of which nearly 580,000 employees in the age can participate in SI but have not participated in. This means that people will not have the opportunity to receive pensions if they do not participate in voluntary SI. This will be a huge burden on the budget in the future when it comes to paying benefits for the elderly due to no pensions.
If in the current period, the expenditure budget supports a part of the voluntary SI premium to stimulate employees' demand to participate in voluntary SI so that when they reach the end of their working age they will enjoy their pensions, then in the long run it will reduce burden on the budget for spending of social protection benefits, purchasing HI cards for the elderly.
Thus, with the situation of participating in voluntary SI as above in the province, in the coming time, if there is no breakthrough to attract employees to participate in voluntary SI, contributing to increasing the coverage rate is very difficult and challenging. In addition to the efforts of the whole political system in enhancing propaganda solutions, widely disseminating the voluntary SI policy to encourage people to participate, promote administrative reform, etc., it is very necessary to have support policies from the local budget to stimulate demand as well as increase the attractiveness, attracting a large number of people to participate in voluntary SI in Binh Duong province.
Facing the above situation, the provincial People's Committee has submitted a proposal to the provincial People's Council to issue a Resolution regulating the policy of funding support for voluntary SI participants in Binh Duong province. The draft resolution is being collected people's opinions from July 30 to August 29, 2020. According to the proposal, based on the current level of State support for poor households participating in voluntary SI of 30% and near-poor households of 25%, and the other of 10%, the local budget will support an additional 70 % of SI premium (VND 107,800/person/month) for the poor households, an additional 75% (VND 115,500/person/month) for the near-poor households and an additional 30% (VND 46,200/person/month) for all other subjects participating in voluntary SI above the monthly SI premium according to the poverty line in rural areas in each period regulated by the Prime Minister (currently applying the social insurance premium is 22% of VND 700,000) in Binh Duong province from 2021. Thus, those belonging to the poor and near-poor households are supported 100% of voluntary SI premium. With the above support policy, every year, the province spends about VND 27,985 billion in voluntary SI payment.
It is expected that, if being supported from the local budget, the average number of people participating in voluntary SI is 29,000 people annually (by 2020, the total number of people participating in voluntary SI according to the figures assigned by the Vietnam Social Security in Binh Duong province is 19,019).
According to Mr. Pham Van Tuyen, the issuance of support policy will attract a large number of employees who have not participated in compulsory SI who will participate in voluntary SI. The subjects are the poor, the near poor who participate in voluntary SI will reach the rate of 100% because the State budget supports the monthly SI premium according to the poverty line of rural areas (in 2020, the number of the poor, the near-poor aged 15 and over in the province is 14,787 people), so that after the end of the working age they will be entitled to the pensions, death, medical examination and treatment covered by HI. In addition, it is also a driving force to motivate people to actively participate in production and work with a stable income, maintain to be able to continue participating in the voluntary SI policy in the long run, thereby promote economic development and sustainable social security.