Decree No. 60/2021/ND-CP on the Financial-Autonomy Mechanism of Public Non-Business Units

Issuance and legal basis

Decree No. 60/2021/ND-CP was issued by The Government on 21 June 2021 in Hanoi, regulating the financial-autonomy mechanism of public non-business units. The excerpt cites as its principal legal bases the Law on Organization of The Government, the Law on State Budget and the Law on Public Investment, upon proposal of the Ministry of Finance. The excerpt provided does not contain the articles on effective date or on amendment, replacement or supersession of earlier instruments, so those transitional details cannot be taken from the source supplied.

Scope and subjects of application

Article 1 provides that the Decree regulates the financial-autonomy mechanism of public non-business units. Article 2 indicates that the subjects of application are public non-business units established by competent authorities. The Decree distinguishes between public non-business services funded by the state budget and those not funded by the state budget, and lays down rules on pricing and fees for such services (Articles 4 to 6), and on management and use of public investment capital and public property (Articles 7 and 8).

Classification of financial autonomy and financial sources

Articles 9 and 10 classify public non-business units by their level of self-coverage of regular expenditure, based on a formula comparing revenues to regular expenditure. The text refers to four groups, including units covering 100% or more of regular expenditure, units covering from 10% to below 100%, and units covering below 10%, with different implications for state budget support. Articles 11, 15 and 19 prescribe the financial sources of units, comprising state budget allocations, revenues from non-business activities, and development investment capital, while Articles 12, 16 and 20 govern regular expenditure assigned under autonomy, and Articles 13, 17 and 21 govern regular expenditure not assigned under autonomy and expenditure for implementation of specific tasks.

Use of funds, distribution of results and operational autonomy

The Decree regulates distribution of annual financial results. Articles 14, 18 and 22 provide for allocation of the difference between revenue and expenditure after tax and state budget remittances, including provisions for funds such as the income supplement fund and other funds, with higher self-financing units (group 1) having greater discretion. Articles 23 to 26 cover opening transaction accounts, principles for mobilization of funds and credit borrowing, autonomy in joint ventures and associations in accordance with the Law on Management and Use of Public Property, and autonomy in using financial sources in compliance with the assigned autonomy expenditure rules.

Special regimes and state management responsibilities

The Decree provides separate regimes for certain types of units. Articles 27 and 28 address allocation of cost estimates for group 3 units and the classification and financial regime of medical centers; Articles 29 to 31 set conditions and financial autonomy for higher education institutions and regional universities, including state budget support and autonomy over scholarship and tuition-related expenditure. Articles 32 to 35 set out formulation, allocation, assignment, accounting and finalization of cost estimates and the grant of financial autonomy, while Articles 36 to 38 define responsibilities of ministries, central agencies, provincial-level People's Committees and public non-business units themselves in promulgating lists of public non-business services, managing and supervising implementation.