VietNamNet Bridge – The Ministry of Transport (MOT) has suggested a bonus worth VND90 billion to South Korean and Japanese contractors to reward their project fulfillments before the deadline.

The VND38.85 billion bonus has been proposed for the consortium of South Korean Samwhan and Vietnamese Cienco 1, which met the Mai Dich – Trung Hoa road project 263 days ahead of the schedule.

A VND51.1 billion reward has been proposed for Japanese Sumitomo Mitsui which fulfilled the Trung Hoa – Thanh Xuan project 454 days before the deadline.

The suggested bonuses are only half the amount initially planned by the investor – the Thang Long Project Management Unit (PMU).

The rewards, which are generally considered normal, have turned out to be controversial. The involved parties are not arguing about the rewards, but how big the bonus should be and where the money should come from.

Dr. Vu Dinh Anh, a renowned economist, mentioned a case in which a contractor received credit from a central government agency. However, in this case, a decision was made that the bonus funds should come from the local budget.

The local authorities then lodged a complaint to the central agency, saying that as the reward was decided by a central agency, the money for the bonus must be sourced from the state budget, not the local budget.

Regarding the suggested VND90 billion bonus, the MOT proposal has embarrassed the Ministry of Finance (MOF) because the ministry’s officials cannot find any regulations about this issue.

An official of MOF said the issue has not been clarified in either the Debt Management Law or Budget Law. This means that if MOF gives the nod to the reward, it would be breaking the law.

MOF finally decided to report the case to the Prime Minister, suggesting that the contractors be rewarded as a “special case”.

Meanwhile, MOT believes there is no need to argue about the legitimacy of the reward. This should not be considered a “reward”, but just as an “implementation of the signed contract” which says that the contractors will get a bonus worth 1.12 percent of the contract’s value for every 28 days shorter than the deadline.

According to MOT, the legal basis for its proposal to reward the contractors is Decree No 12 effective in 2009 about the management of transport infrastructure projects.

The legal document says that in case projects are implemented at a high speed, thus bringing higher efficiency, the contractors will be rewarded in accordance with the contracts.

US$1 = VND21,000.

Pham Huyen