Viet Nam’s pension scheme reform needed: ILO Report

News | 02 August 2012

The ILO and the Ministry of Labour, Invalids and Social Affairs jointly organized events on August 2 and 3 to share the findings and recommendations of the “Actuarial valuation of the public pension scheme of the Viet Nam Social Security Fund”, which was requested by the Vietnamese Government and was carried out with the support of the Ministry of Labour, Invalids and Social Affairs, Viet Nam Social Security, Ministry of Finance and General Statistical Office.

According to the ILO expert, Hiroshi Yamabana, the Viet Nam pension scheme is under serious stress: it could start running deficits by 2020 and could be depleted by 2029. The ILO valuation is the first analysis that forecasts the financial impact of four different reforms:

Increase the retirement age to 65 years old.

Change the pension formula.

A combination of the previous two.

A Notional Defined Contribution system.

The ILO underlined the need to push a reform to ensure the protection of workers. It would be urgent to improve enforcement so that employers and employees contribute according to real salaries. Furthermore, the reform should lead to a more equitable treatment between public officials, private employees and informal workers.

Actuarial valuation of the public pension scheme of Viet Nam.

Proposal for Social Insuarance Law Revision

Speech of Mr Gyorgy Sziraczki, Director of ILO Country Office for Viet Nam