Organizational System of Vietnam Social Security:

+ Direct and organize the implementation of social insurance policies and regimes; collect compulsory and voluntary social insurance contributions; pay social insurance subsidies to social insurance participants fully, conveniently and on time according to the provisions of law.

+ Issue all types of social insurance cards.

+ Manage the Social Insurance Fund according to the principle of centralized and unified management according to the State's financial regime, independent accounting and State protection.

Make recommendations to the Government, the Prime Minister and relevant state agencies on amending and supplementing policies and regimes on social insurance; fund management mechanisms, financial management mechanisms (including management costs of the apparatus of Vietnam Social Security) and organizing implementation after approval.

+ Issue documents guiding the implementation of social insurance regimes and social insurance collection and payment operations within authority; internally manage the Vietnam Social Security sector.

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+Organize contracts with legal medical examination and treatment facilities to serve people with insurance books and cards according to the provisions of law.

+ Inspect the signing of contracts and the collection and payment of social insurance for agencies, units, organizations using labor, individuals, and medical examination and treatment facilities; make recommendations to competent State agencies and superior agencies of labor using units and medical examination and treatment facilities to handle violations of the law on social insurance.

+ Refuse to pay social insurance benefits when the insured person does not meet the conditions for insurance benefits according to the law or when there is legal basis for acts of falsification or false declaration of documents to receive insurance benefits.

+ Compensate for all revenue and expenditure that are not in accordance with the law on social insurance regime for social insurance participants.

+ Resolve complaints and denunciations of organizations and individuals regarding the implementation of social insurance policies and regimes according to the provisions of law.

+ Store records of participants and beneficiaries of social insurance according to the provisions of law.

+ Organize scientific research and application; apply information technology in management and operation of social insurance activities.

+ Organize training and professional development in social insurance.

+ Organize information and propaganda work, disseminate social insurance policies and regimes.

+ Implement international cooperation on social insurance according to the provisions of law.

+ Preside over and coordinate with State agencies, socio-political organizations, social organizations at the central and local levels, and social insurance participants to resolve issues related to the implementation of social insurance policies and regimes according to the provisions of law.

+ Manage the organization, cadres, civil servants, state employees; finance and assets of Vietnam Social Security according to the provisions of law.

+ Implement reporting regime with the Government, Prime Minister and competent State agencies according to law provisions.

3. Organizational system of Vietnam Social Security:

Pursuant to Decree No. 19/CP dated February 16, 2005 of the Government on the establishment of Vietnam Social Security, on September 26, 1995, the Prime Minister issued Decision No. 606/TTg regulating the organization and operation of Vietnam Social Security. According to this Decision, Vietnam Social Security is organized and managed vertically at 3 levels from the Central to the district level.

Vietnam Social Security is directly managed and operated by the General Director under the headship regime and is responsible to the management board. Assisting the General Director are Deputy General Directors and specialized professional departments.

The current management apparatus assisting the General Director of Vietnam Social Security includes:

1. Social insurance policy and regime board

2. Planning and finance department

3. Social Insurance Collection Board.

4. Social Insurance Department.

5. Voluntary Social Insurance Board

6. Medical examination board.

7. Social Insurance Propaganda Department.

8. International Cooperation Department.

9. Personnel organization committee.

10. Inspection Board.

11. Office

12. Social Insurance Science Research Center

13. Information Technology Center

14. Center for training and fostering social insurance profession.

15. Storage center.

16. Social Insurance Newspaper

17. Social Insurance Magazine

At the same time, Vietnam Social Security issued Document No. 150/BHXH - TCCB dated October 3, 1995 guiding the organization of staff of the Social Security system at the local level. According to this document, the Provincial Social Security is managed and operated by 1 Director, assisted by 1 to 2 Deputy Directors. Provincial and centrally-run City Social Security has 4 to 6 professional departments depending on the revenue and expenditure tasks of each Province and City. District Social Security is managed and operated by only one Director in general.

However, for districts with a lot of work, they can add a deputy director to assist. District Social Insurance is not allowed to have a department structure.

Deputy General Manager

CEO

Organizational chart of the operating apparatus of the Vietnam Social Security system

PRIME MINISTER

BOARD OF DIRECTORS

Deputy General Manager

Collection

Inspection Board

Office

Mode Board

Organizing Committee

Science and Technology Department

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Medical Examination Board

Social Insurance Board

voluntary

Propaganda Department

International Relations Department

Social Insurance Newspaper

Storage Center

Social Insurance Magazine

Training Center

Center for Scientific Research

IT Center

DIRECTOR OF PROVINCIAL SOCIAL INSURANCE

Deputy Director Deputy Director

II. CURRENT STATUS OF VIETNAM SOCIAL INSURANCE FUND

The Social Insurance Fund is formed from contributions from employers, employees, profits from growth investment activities, and contributions and support from the State. Before 1995, the Social Insurance revenue was very small, all Social Insurance expenditure needs were provided by the State budget, and there was no independent Social Insurance Fund.

From 1995 to present, with the establishment of the Vietnam Social Security system as a public service unit under the Government, the Social Security Fund was formed and accounted for independently from the State budget. Therefore, the topic would like to study the current situation of the Vietnam Social Security Fund through two periods:

1. Vietnam Social Security Fund before 1995

1.1. Legal regulations

* Fund source

On March 22, 1962, Decree No. 39/CP of the Government was officially issued, stipulating the revenue sources of the State Social Insurance Fund including:

- Money paid monthly by government agencies, organizations, enterprises, construction sites, etc. into the social insurance fund at a certain percentage of the total salary fund.

- Annual State subsidies to the Social Insurance Fund in necessary cases.

- Other items.

* Purpose of fund use

- Allowance when state employees are sick;

- Allowance when female civil servants give birth, have miscarriages, or lose their ability;

- Allowance for state employees who have work-related accidents or occupational diseases;

- Pension for civil servants;

- Burial allowance and death benefit when a State employee or civil servant dies;

- Expenses for social insurance fund management and social insurance career management;

- The State Social Insurance Fund has no surplus.

If good management results in surplus money each year, it is allowed to use that surplus money to build additional social insurance projects.

* Social Insurance Fund Management Agency

Initially, the management of the Social Insurance Fund was assigned to the Ministry of the Interior under Decree No. 218/CP dated December 27, 1961. Later, it was assigned to two agencies: the Ministry of Labor, Invalids and Social Affairs and the Vietnam General Confederation of Labor. Of which, the Ministry of Labor, Invalids and Social Affairs manages the payment of pensions, loss of working capacity and death benefits. The remaining amount is managed by the Vietnam General Confederation of Labor to pay for sickness, work-related accidents and occupational diseases.

1.2. Current status of social insurance fund before 1995

1.2.1. Revenue and expenditure results of the Social Insurance Fund

In our country, the social insurance fund was formed together with the social insurance policy and regime since 1945. Before 1993, the fund was designed according to the revenue-expenditure model, employees did not have to contribute to form the social insurance fund (Although Decree No. 105 dated June 14, 1946 of the President of the Government of the Democratic Republic of Vietnam stipulated that civil servants must contribute 6-10% of their salary to the social insurance fund, but in reality it was not implemented), all expenditures from the social insurance fund were guaranteed by employers and the state budget. Due to the increasing expenditure demand, while the revenue contributed by employers was low, the state budget had to spend more and more. On average, from 1965 to 1994, the state budget annually ensured 86.72% of the demand for social insurance regimes, while the revenue from employers only met 13.28% of the expenditure demand.

Since 1993, employees have actually had to contribute 5% of their monthly salary to the social insurance fund, together with the employer's contribution of 15% of the salary fund to form a social insurance fund designed according to the community-based model, managed centrally, uniformly, and independently from the state budget.

During this early period, the revenue and expenditure of the Social Insurance Fund were distributed among two fund management agencies:

- The total revenue of the Vietnam General Confederation of Labor is 958,371 million VND, the State supports 5,476 million VND. The collection rate of 3.7% of the total salary fund used to pay for three regimes: Sickness, maternity, occupational accident - occupational disease is low. On average, during this period, the actual revenue is only 86.04% of the plan, some years only reaching 70-75% of the plan.

- The revenue of the Social Insurance Fund managed by the Ministry of Labor, War Invalids and Social Affairs reached 4,026 million VND, but the total expenditure for three regimes: Retirement, loss of working capacity, and death was 25,207 million VND. The State budget had to compensate 21,181 million VND, accounting for 84.04% of the total expenditure for the three long-term regimes. The actual revenue implemented by this agency also did not meet the planned target, the highest only reaching 93.46% of the plan (in 1975).

Thus, the outstanding feature of this period is that the fund's revenue is not enough to pay for the regimes, the State budget has to annually provide a very large amount of compensation. The fund has no balance, so for a long period of half a century, there is no investment activity to increase the fund.

1.2.2. Evaluation of results

- Achievements: During this period, the social insurance policy was organized and implemented and achieved significant results. This result contributed to stabilizing the lives of millions of workers working in administrative agencies, political organizations, unions, social organizations, armed forces and economic and production units.

business when they encounter incidents of illness, maternity, occupational accidents and diseases, loss of working capacity, retirement, and death. As of 1994, the social insurance policy has guaranteed benefits for more than 6 million people receiving maternity benefits, more than 30,000 people receiving occupational accident and disease benefits, nearly 600,000 people receiving loss of working capacity benefits; about 1.5 million people receiving pensions, including 160,000 military and police officers, 300,000 people receiving monthly pensions, and hundreds of thousands of people receiving convalescence benefits.

- Limitations

During the process of organization and implementation, the social insurance policy has clearly revealed shortcomings and limitations in the social insurance regimes:

+ Building social insurance policies: Regulations of the State, Government, Prime Minister, and guidance documents of ministries and branches lack consistency in content and enforcement (even lacking feasibility and being too strict).

+ Implementation organization: The management and implementation of social insurance regimes, policies and regimes are fragmented and not synchronized. The state management and career management functions are performed by one agency, the Vietnam General Confederation of Labor. Overlapping and loose management creates many loopholes for violations of social insurance regimes, fraud in creating fake documents to appropriate state assets. Therefore, it increases expenditures and revenue losses of the social insurance fund.

+ Social insurance collection, settlement of regimes and policies: are undertaken by two agencies, so the implementation is fragmented and there is no necessary coordination. There are years when the fund for short-term regimes is not fully spent and is transferred to welfare purposes for workers, while the fund for long-term regimes managed by the Ministry of Labor, War Invalids and Social Affairs is constantly overspending and constantly having to ask for subsidies from the State budget.

In fund management activities, the balance of revenue and expenditure of the Social Insurance Fund is not considered important. Revenue is collected and expenditure is compensated by the State budget, leading to ineffective management of Social Insurance finances.

+ Unreasonable structure: Social insurance management and career expenses account for a higher proportion than total expenses, there is no coordination between central and local agencies to resolve social insurance regimes.

+ The binding relationship of responsibilities and benefits among the three parties: employers, employees, and the State has not been clearly demonstrated. In fact, the subsidy for social insurance regimes during this period was taken from the State budget.

+ Investment work aimed at preserving and increasing the social insurance fund has not received much attention. Meanwhile, according to the experience of other countries, revenue from idle fund investment interest is an important source of revenue for the social insurance fund. The main reason is that the social insurance fund is fragmented by two management agencies, the Vietnam General Confederation of Labor and the Ministry of Labor, War Invalids and Social Affairs. Both of these agencies do not have a fund balance, and their revenue is not enough to cover their expenses, so they cannot implement measures to invest the fund.

The above are only the most basic limitations, in reality there are many shortcomings. Therefore, reforming the operating mechanism of social insurance has become an urgent need. Decree 12/CP and Decree 119/CP marked the birth of Vietnam Social Insurance, recording a new step forward in the development process of Vietnam Social Insurance.

2. Vietnam Social Security Fund from 1995 to present

2.1. Legal regulations

* Sources for forming the compulsory social insurance fund include:

1- Contributions of social insurance participants as prescribed in Article 36 of the Social Insurance Regulations issued together with Decree 12/CP dated January 26, 1995 of the Government.

Over time, Decree No. 12/CP in 1995, Decree No. 01/2003/ND-CP and Circular No. 07/2003/TT-BLDTBXH were successively issued; in particular, in June 2006, the Social Insurance Law was issued, providing more specific and complete regulations on subjects participating in social insurance:

- Employees participating in compulsory social insurance are Vietnamese citizens including:

+ People working under indefinite-term labor contracts or labor contracts with a term of three months or more;

+ Cadres, civil servants, public employees;

+ Officers and professional soldiers of the people's army; officers and professional non-commissioned officers, officers and technical non-commissioned officers of the people's police; people working in cryptography receiving salaries as those of the people's army and people's police;

+ Non-commissioned officers and soldiers of the People's Army and non-commissioned officers and soldiers of the People's Police serving for a limited period of time;

+ People working for a limited period abroad who have previously paid compulsory social insurance.

- Employers participating in compulsory social insurance include state agencies, public service units, people's armed forces units, political organizations, socio-political organizations, socio-political-professional organizations, socio-professional organizations, other social organizations; foreign agencies, organizations, international organizations operating in Vietnam; enterprises.

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