Draft Law on Public Investment: Balancing Economic Objectives and Sustainable Development

According to Dr Bui Ha, Director General of the Department of National Economy (MPI), Public Investment Law Project had been submitted to the National Assembly by the Government for comments at the 6th session of the National Assembly XIII in October 2013 and is expected to submit to the National Assembly in the 7th session of the National Assembly in May 2014. Dr Ha added in the discussion at group meetings and conference hall at the 6th Session of the National Assembly XIII, a majority of the delegates were unanimous that the National Assembly should issue this law to create the legal framework to strengthen management and improve the efficiency of public investment, against all acts of wasteful loss for investment resources of the country. Back to the main content of this law, most of the contents received concurrence of the National Assembly delegates, Dr Ha added.

However, because this is an important bill relevant to many practical benefits so many localities send feedback, to define the rights of local or central government in approving and implementing investment projects. Specifically, Mr Truong Van Vo, Deputy Head of the Dong Nai delegation in the National Assembly, said that the project of Law on Public Investment has consistent rules. However, a number of "backbone" concept needs to be clarified and defined more closely. He cited an example that the development and construction of hydropower clearly bring high economic efficiency but in terms of social efficiency, there are still many problems such as disturbing the ecosystem, affecting the natural environment and the people living in the area of hydropower development planning, etc. Hence the Law on Public Investment must contain rules that benefit both the economic development but still guarantee the sustainable development of society. Regarding the form of public-private partnership (PPP ), experience shows that if the state does not specify a minimum capital of 30 percent, then investors of infrastructure projects will not participate.

Another point was also raised by Mr Vo was that currently economic regional development is a new trend. Therefore, lawmakers should also attach the key project with the regional criteria. Because if not taking into account the regional and local factors, the public investment will easily lead to waste and spreading consequences. In addition, the draft law should clarify the responsibilities of public investment to specific authority and individual. The final section, Clause 2, Article 81 does mention that content but it does not clarify liability of evaluation, and responsibility of decision makers... If not, when there is problem concerning the responsibilities, it is difficult to determine who has to take full responsibility, Vo said.

Mr Nguyen Quoc Khanh, Vice Chairman of An Giang provincial People’s Committee, wondered if the Law on Public Investment assigns the Provincial Councils authority to identify key project in group B? Because Clause 5, Article 17, of the draft Investment Law clearly states: "People's Councils at all levels decide investment policy of major projects in group B of the locality which are invested entirely by local balance budgets, local government bonds and investment funds, but not put in the local balance budget under the authority of the People's Councils at all levels. Provincial People’s Council specified criteria for key projects of locality." Mr Khanh said that the investment policy for the key projects of group B should be delegated to the government to decide. If it is done, we have consistency in the direction and execution, to avoid the overlapping of authority of People’s Council and People's Committees.