According to the Ministry of Planning and Investment , the disbursement of public investment capital nationwide as of July 31st was approximately VND 232,100 billion, reaching only 34.68% of the plan assigned by the Prime Minister, compared to 37.85% in the same period of 2023. Of these, 33 ministries and central agencies and 25 localities had disbursement rates lower than the national average. Notably, some localities had disbursement rates below 20%, such as Ho Chi Minh City, Phu Yen, and Bac Ninh.
What caused the delay?
Observing the situation at two of the urban renovation projects eagerly awaited by Ho Chi Minh City residents – the Xuyen Tam canal renovation project (connecting the Vam Thuat river to the Nhieu Loc - Thi Nghe canal, spanning Binh Thanh and Go Vap districts) and the environmental improvement project on the northern bank of the Doi canal in District 8 – representatives from the Ho Chi Minh City Urban Infrastructure Investment and Construction Project Management Board, the investor of both projects, stated that current difficulties include adjusting the investment policy due to increased compensation costs for land clearance; the arrangement of resettlement plots and land clearance work also face many challenges, resulting in less than optimal disbursement of public investment funds.
For the environmental remediation project on the northern bank of the Doi Canal, the estimated compensation cost for land clearance, as approved by the Ho Chi Minh City People's Council, is 3,583 billion VND. However, during implementation, the project underwent changes in compensation methods and policies due to the application of the Land Law which came into effect on August 1, 2024.
Simultaneously, the compensation, support, and resettlement policy for housing projects on and along canals in Ho Chi Minh City is expected to apply a support level of 70% of the land compensation price. The Compensation and Land Clearance Board of District 8 has updated the estimated compensation and land clearance costs to 6,000 billion VND, an increase of 2,485 billion VND compared to the total investment amount that was previously approved. Therefore, it is necessary to adjust the investment policy of the project as a basis for implementing compensation, support, and resettlement work for the project, which is expected to be submitted to the Ho Chi Minh City People's Council in the upcoming September session.
In addition to adjusting the project's investment policy, the housing fund for resettlement is also awaiting resolution from relevant departments and agencies in coordination with District 8. "Currently, the Infrastructure Project Management Board is striving to expedite related procedures to obtain approval for the feasibility study report in the third quarter of 2024, as a basis for implementing the preparation of construction drawings and cost estimates; carrying out compensation and resettlement support; and commencing construction in 2025 as planned," a representative from the Infrastructure Project Management Board stated.
Regarding the Xuyen Tam canal renovation project, the main difficulty stems from the enormous amount of land clearance required. Currently, Go Vap and Binh Thanh districts are urgently carrying out procedures to complete the handover of land to the Infrastructure Project Management Board for commencement of construction as planned. Go Vap district expects to hand over the entire route of land in December 2024.
In Binh Thanh District specifically, due to the very large volume of land clearance required, it is expected that the district will only complete the procedures to hand over the land to the investor for the commencement of the XL-01 and XL-02 packages by April 2025.
The Xuyen Tam canal renovation project is facing difficulties in land clearance and resettlement for residents. Photo: HOANG TRIEU
Besides the two projects mentioned above, several bidding packages under component 1 of the Ho Chi Minh City Ring Road 3 project are also behind schedule. For example, in the area passing through Binh Chanh district, many sections have ready ground but construction has not begun due to a shortage of sand, posing a challenge to the goal of completing the entire project by 2026.
The Tham Luong - Ben Cat - Nuoc Len canal renovation project has 9 out of 10 construction packages currently undergoing trial installation of reinforced concrete piles. However, construction is facing some difficulties as 54 households and businesses have re-encroached on land previously handed over to the project in phase 1; some sections of the canal banks are also being polluted by dumped garbage, hindering construction.
In Dong Nai province , a series of key transportation projects, such as two component projects of the Bien Hoa - Vung Tau expressway, the Ho Chi Minh City Ring Road 3, the riverside road and park, the Dong Nai river embankment, and the Cai riverside road, have failed to meet their disbursement targets, despite the vigorous efforts of relevant agencies and localities to accelerate land clearance. Representatives from several project owners stated that the biggest obstacle affecting the disbursement of public investment funds in the province remains the land clearance process for project construction.
The difficulties lie not only in land clearance.
The Acting Chairman of the People's Committee of Dong Nai province, Mr. Vo Tan Duc, acknowledged that land clearance for projects in the province is still slow, leading to the disbursement of public investment funds not meeting expectations. "At the beginning of the year, the units committed to disbursing 50% of the planned capital by the end of June. However, by the end of July, the province had only disbursed over 5,400 billion VND, reaching over 28% of the planned capital," Mr. Vo Tan Duc pointed out during a recent meeting reporting on the socio -economic situation in early August.
Mr. Le Ngoc Linh, Director of the Department of Planning and Investment of Ba Ria - Vung Tau province, also pointed out that the low disbursement of public investment capital in the province is due to difficulties and obstacles in compensation and land clearance; difficulties in completing investment procedures and related to the project implementation process. Specifically, to date, the province still has 62 projects that have not completed compensation and land clearance work, and some projects are facing obstacles related to national defense land and forest land.
In addition to the aforementioned obstacles, the lack of close, decisive, and proactive coordination between the investor and local authorities, coupled with the failure of leaders to definitively resolve issues, also contributes to the problem. Furthermore, the contractor's limited construction capacity is also a contributing factor.
Chairman of the Ho Chi Minh City People's Committee, Phan Van Mai, pointed out that difficulties lie in stages such as planning, land clearance, and procedures. Many projects have to wait for new laws such as the Land Law 2024, which takes effect from August 1, 2024, and the Bidding Law 2023, which takes effect from January 1, 2024. However, the guiding documents were only fully issued at the end of April, partly prolonging the time for selecting contractors to implement the projects and the time for carrying out subsequent steps.
Furthermore, some large-scale investment projects in the city are facing difficulties and procedural obstacles and are in the process of coordinating with central ministries and agencies to resolve them, thus preventing the immediate disbursement of allocated funds. In addition, coordination among relevant agencies, including project development partners, in disbursing ODA funds and preferential loans from foreign donors is slow, affecting the progress and completion of projects…
An official in charge of public investment at a state agency in Ho Chi Minh City pointed out several additional reasons for the slow disbursement rate of public investment. For example, projects using transitional budget funds may not have completed the necessary work to disburse funds further, leading to delays. This is because, typically, after the bidding process is completed at the end of the previous year, the project owners (departments, sectors, districts, and counties) have already advanced funds to contractors. Now, there is either no or insufficient work completed to disburse further funds. Therefore, the first few months of the year are usually limited to completing the necessary paperwork. For projects in the preparation phase, delays may occur in the project appraisal and approval stages, or in the contractor selection process.
Furthermore, some new regulations in the 2023 Bidding Law are also creating obstacles affecting the progress of bidding and project approval in local departments, districts, and counties. For example, previously, Circular 08/2022/TT-BKHĐT, which details the provision and posting of information on bidding and contractor selection on the national online bidding system, stipulated that even if only one bidder participated in a competitive online bidding package, the investor could immediately open the bids to conduct the evaluation.
Dong Nai is urgently handing over the land.
During a working session with departments, agencies, and localities on the progress of compensation and land clearance for the Bien Hoa - Vung Tau Expressway and Ho Chi Minh City Ring Road 3 projects on the afternoon of August 13th, Mr. Vo Tan Duc instructed the units to thoroughly understand and implement the work in accordance with the Prime Minister's directive of "only discussing how to do it, not how to back down," strengthening their sense of responsibility, all for the sake of national key projects and the development of Dong Nai province.
Mr. Vo Tan Duc urged relevant agencies to make greater efforts and enhance their responsibility in performing their duties; focusing on working even at night, on Saturdays and Sundays to complete the remaining workload. "By the end of August, Bien Hoa City and Long Thanh District must complete the approval of compensation plans for all cases of land relinquishing for the Bien Hoa - Vung Tau expressway; Nhon Trach District must hand over the entire land area for the Ho Chi Minh City Ring Road 3," the acting Chairman of the Dong Nai Provincial People's Committee emphasized.
Mr. Duc also requested the Department of Industry and Trade of Dong Nai province to take the lead in guiding units to prepare documents and procedures so that the relocation of technical infrastructure systems along the Bien Hoa - Vung Tau expressway can begin in the fourth quarter of 2024. The Department of Planning and Investment, in coordination with the Department of Finance, will develop a plan to allocate additional budget for localities to pay compensation and support.
(To be continued)
(*) See the Nguoi Lao Dong newspaper from the issue dated August 13th.
Source: https://nld.com.vn/giai-ngan-von-dau-tu-cong-tin-hieu-tich-cuc-con-nhieu-du-an-tre-hen-196240813205849563.htm
