Story

Viet Nam’s Social Security Reform Looks To The Future

28 May 2018
Caption: Mrs. Phung Thi Vinh, Hoai Duc, Hanoi. “I got my pension payments thanks to the Government support” I worked as an elementary school teacher since 1978. Back then, being a teacher in the rural area means you only have monthly salary which is calculated upon a time basis. I was not a payroll officer, so I didn’t have to contribute to compulsory social security scheme. That is why I did not get to contribute to social insurance until 2005, but my time of contribution still would not meet the 20-year contribution requirement. Thanks to the government support, it was possible to claw back on social security from 1995 to 2004 so that I can meet the requirement. Now both my husband and I receive pension payments: albeit small, it substantially helps keep our body and soul together. Cô Phùng Thị Vinh, sinh năm 1960, Hoài Đức, Hà Nội “Được nhà nước hỗ trợ mới có đồng lương hưu” Tôi bắt đầu làm giáo viên mầm non từ năm 1978. Nhưng thời ấy, giáo viên mầm non ở nông thôn như tôi chỉ được hưởng lương công điểm, không thuộc biên chế Nhà nước nên không được tính hưởng bảo hiểm xã hội. Mãi đến năm 2005, tôi mới bắt đầu đóng BHXH, nhưng như vậy thì vẫn không kịp số năm hưởng lương là 20 năm. May là nhờ chính sách của Nhà nước, tôi được truy đóng Bảo hiểm xã hội từ năm 1995 đến năm 2004. Tôi chỉ phải đóng thêm từ năm 2005 đến 2015 nữa thì đủ tuổi nghỉ hưu, cũng vừa tích lũy đủ 20 năm đóng BHXH để hưởng lương hưu hàng tháng. Mọi người bảo trường hợp của tôi là đặc biệt, từ chỗ không thuộc diện tham gia BHXH, bắt đầu được đóng BHXH từ năm 2005. Từ chỗ không còn đủ thời gian để tích lũy đủ 20 năm, tôi được truy đóng BHXH 10 năm từ năm 1995 đến 2004 để tích lũy đủ 20 năm đóng BHXH. Bây giờ vợ chồng tôi cả hai đều có lương hưu và thẻ bảo hiểm y tế, tuy cũng chỉ đơn giản vài triệu 1 tháng nhưng cũng phần nào đủ trang trải cuộc sống gia đình.
Photo: © ILO

By 2030 the number of people above 65 with a contributory pension is projected to be less than two million leaving around ten million without a pension.

Viet Nam is one of the fastest aging societies in the world. Rising longevity and declining fertility have combined to swell the number of older persons needing care and reduce the number of workers supporting them. While in 2015 there were about six working-age adults for one older person above 60 years, in 2055 it will only be two workingage adults per older person. This means that tomorrow’s so-called “sandwich generation” will face an increased burden of caring for three generations. In the absence of pensions, the responsibilities of society are also heavier. Ensuring universal protection in old-age is hence not only beneficial for older persons, but also for families.

Currently the coverage of social insurance in Viet Nam is merely 27% of the labour force. By 2030 the number of people above 65 with a contributory pension is projected to be less than two million leaving around ten million without a pension.

In May 2018, Resolution 28-NQ/TW on MPSIR was approved, representing a breakthrough on social policy in Viet Nam. MPSIR brings Viet Nam closer to the most advanced economies in the world in regard to social security policies, particularly through its focus on comprehensive and integrated approaches to address contemporary social security challenges. ILO contributed to shaping the MPSIR by assessing the current social security system, recommending possible options for the reform through technical papers, and supporting policy dialogues with workers, employers and other stakeholders.

The resolution also established the goal of universal social protection coverage, aligning Viet Nam’s policies with international commitments and obligations such as the right to social security in the International Covenant on Economic, Social and Cultural Rights, the ILO Recommendation on Social Protection Floors (R202) and the UN 2030 Sustainable Development Agenda. The decision to reach universal coverage through both contributory (social insurance) and non-contributory (tax funded) benefit sets Viet Nam on a similar path to neighbouring countries with universal coverage such as Japan, South Korea, China or Thailand.

Proposed incremental reforms such as the gradual increase in retirement age, equalizing the qualifying ages for men and women for retirement age and old-age benefits, and aligning replacement rates to international levels will all contribute to ensuring the long-term financial sustainability of the system. These are essential elements of the reform to guarantee that the system respects and furthers the rights being acquired today.

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ILO
International Labour Organization

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