Vietnam's bloated government eats up budget: think tank

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A worker sits on top of a bus station under construction during rush hour on a street in Vietnam. Vietnamese government has spent less and less on infrastructure and other public construction projects, allegedly due to increases in current expenditure. Photo: Reuters A worker sits on top of a bus station under construction during rush hour on a street in Vietnam. Vietnamese government has spent less and less on infrastructure and other public construction projects, allegedly due to increases in current expenditure. Photo: Reuters

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The Vietnamese government is spending more on its bloated administrative system than infrastructure and other public works, news website Saigon Times Online quoted a government think tank as saying in a report last week.
Due to this increasingly expensive structure, the government has less money for developmental projects. The ratio of investment to total spending fell from 21.5 percent in 2010 to an estimated 16.2 percent last year.
Since 2010 the government's expenditure has ballooned, but most of it was on salaries as spending on health care and education remained almost unchanged, according to the report releasedby the Central Institute for Economic Management on December 17 .
Figures from the Ministry of Finance show that the government's expenses were VND376.62 trillion (US$16.52 billion), or 44.2 percent of the total spending in 2010. The ratio jumped to over 70 percent last year when the expenditure was estimated at VND704.4 trillion ($30.91 billion).
Around eight million people, including retirees, get paid by the government, the institute quoted a report by the finance ministry as saying.
That means one in every 11 Vietnamese is paid by the government -- in some localities such as the northern province of Quang Ninh, the ratio is even higher at around 1:8.5 -- the institute said in the report, blaming the "huge" number on cumbersome administrative systems.
Since the government has to spend more and more on administration, it has had to reduce other spending, especially for infrastructure and other public works, it said.
Without thorough administrative reform at level levels, the government's spending will continue to increase, according to the institute. Moreover, if left unchanged, the system would act as a drag on administration and increase corruption, it added.

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