VietNamNet Bridge - Although the Vietnamese government had ordered a widespread reduction in public spending, data from the General Statistics Office (GSO) has shown that public expenditures in provinces and cities in the first five months of 2011 have far exceeded those from the previous year.

Spending in Hanoi surged 17.3 percent year on year to about VND6.1 trillion, making the city the biggest spender during the reviewed period, according to the GSO.

However, Hoang Manh Hien, vice chairman of Hanoi’s government, told Tuoi Tre that the city has met its revised annual spending target of 30.4 percent.

In previous years the city had a spending target of VND16 trillion, but it later cut VND825 billion from 253 projects deemed unnecessary, following the direction of Resolution 11 which aimed to stabilize the economy and control government inflation.

Key infrastructure’s projects in Hanoi are still underway, and the capitals set aside for them are unknown.

The city have also saved VND825 billion for the rest of the year and another VND88 billion from putting a freeze on the purchasing of new cars, air-conditioners and other properties, Hien said.

Meanwhile, the Mekong Delta city of Can Tho is another locality that used a large portion of the state budget in the first five months of 2011, spending about VND1.56 billion, an increase of nearly 32 percent over the same period in 2010, according to the GSO.

A major part of Can Tho’s spending is being used to repay debts for old projects, mainly for major infrastructure projects including the linking road from Mau Than Street to Tra Noc Airport, said Vo Thanh Sang, director of the Planning and Investment Department.

In addition, smaller amounts of capital were also allocated for projects in healthcare and education.

Can Tho has delayed 79 projects in order to cut public investment, Sang said.

However, the city needs more than VND2 trillion to pay off its debt and is seeking the government’s approval to use next year’s allocation from the state budget in advance, he said.

Can Tho’s neighboring province of Hau Giang used VND2.5 trillion, up 42 percent over the same period last year, though this year’s capital allocation is only VND1.6 trillion.

Most of the spending was for infrastructure projects, said Tran Cong Chanh, chairman of the municipal government.

Vietnam's state budget deficit is estimated at VND22.3 trillion as of May 15, equal to 18.5 percent of the year’s target of VND120.6 trillion, according to GSO's data VnEconomy reported.

The state budget revenue was estimated at VND248 trillion as of mid-May, meeting the yearly target of 41.7 percent, while expenditures were VND270.3 trillion, or 37.3 percent of year estimate. 

Top state budget spenders in January to May:

The Ministry of Planning and Investment has revealed that after three months of implementing the Resolution, relevant ministries and branches have managed to reduce VND5.5 trillion of investment from the state budget in 2,048 projects and VND2.77 trillion in 126 projects funded by government bonds,  according to the Vietnam News Agency.

State-owned economic have postponed 907 projects, with total investment capital of VND39.2 trillion, equal to 10.7 percent of planned development investment capital this year.

In parallel with reducing public investment, ministries, sectors and localities nationwide have cut their regular expenditure by 10 percent or VND3.85 trillion and will strive to reduce overspending to less than 5 percent of GDPThe savings from regular spending will be used for social welfare.

Source: Tuoi Tre