Analyze and evaluate the efficacy of thesocial housing development program in dongnai province from 2016 to 2020

Name Student ID Task Evaluate Vo Thi Minh Hieu K194030358 Program analysis, Evaluation ofeconomic and social efficiency, Land solutions and house modelregulations, ConclusionLuong Thi Ng

VIET NAM NATIONAL UNIVERSITY HO CHI MINH CITYUNIVERSITY OF ECONOMICS AND LAW

PUBLIC ECONOMICS 2

ANALYZE AND EVALUATE THE EFFICACY OF THESOCIAL HOUSING DEVELOPMENT PROGRAM IN DONG

NAI PROVINCE FROM 2016 TO 2020

Instructor: MD Nguyen Thi Thu Trang

Ho Chi Minh, January 5 2022th

Name Student ID Task Evaluate Vo Thi Minh Hieu K194030358 Program analysis, Evaluation of

economic and social efficiency, Land solutions and house model

regulations, Conclusion

Luong Thi Ngan K194030364 Theoretical basis, The overall evaluation of the program’s outcomes, Limits of the program,

Land solutions and house model regulations, Conclusion

Nguyen Ngoc Kim Ngan

K194030366 Social housing development, About the program, Government interventions, Recommendations

on capital and administrative procedures, Word synthesis

Tran Ngoc Thanh Quyen

K194030374 Introduction, Market failure in Dong Nai housing development, Land solutions and house model regulations, Word synthesis

100%

LIST OF PICTURES i

LIST OF ACRONYMS ii

INTRODUCTION 1

1 The reason for the topic selection 1

2 Objectives of the essay 1

3 Research methods & data source 2

4 Research object and scope 2

5 Structure of the essay 2

CHAPTER 1 THEORETICAL BASIS 3

1.1 The concept of public expenditure and the evaluation of public expenditure 3

1.1.1 The concept of public expenditure 3

1.1.2 The concept of evaluating public expenditures 4

1.2 The concept of social housing and the development of social housing 4

1.2.1 Social housing concept 4

1.2.2 Social housing development 5

CHAPTER 2 ANALYSIS AND EVALUATION OF THE EFFECTIVENESS OF THE SOCIAL HOUSING DEVELOPMENT PROGRAM IN DONG NAI PROVINCE IN THE PERIOD 2016 – 2020 7

2.1 About the program 7

2.2 Program analysis 7

2.2.1 The necessity of the program 7

2.2.2 Objectives of the program 8

2.3 Market failure in Dong Nai housing development 9

2.3.1 Imperfect competition 9

2.3.2 Information asymmetry 10

2.3.3 Externalities 11

2.3.4 Incomplete Markets 11

2.4 Government interventions 12

2.5 Evaluate the effectiveness of the program 14

2.5.1 The overall evaluation of the program's outcomes 14

2.5.2 Evaluation of economic and social efficiency 16

2.5.3 Limits of the program 18

CHAPTER 3 CONCLUSIONS & RECOMMENDATIONS 20

3.1 Land solutions and house model regulations 20

3.1.1 Recommendations of Tran Ngoc Thanh Quyen 20

3.1.2 Recommendations of Luong Thi Ngan 21

3.2 Recommendations on capital and administrative procedures: 22

3.2.1 Recommendations of Vo Thi Minh Hieu 22

3.2.2 Recommendations of Nguyen Ngoc Kim Ngan 22

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LIST OF PICTURES

Picture 2.5 The graphic shows the number of social projects that have been with drawn and are still valid in the province in the period 2014-2020

Co., Ltd Company Limited

INTRODUCTION1 The reason for the topic selection

Housing is regarded as one of a person's most basic needs It plays an essential part in the reproduction of labor by providing both tangible and immaterial satisfaction to users, so favorably contributing to the country's socio-economic progress During the country's period of urbanization, the wealth disparity has hindered many workers from having a home in which to have a stable life Therefore, our government is concerned about the subject of social housing for people and is regularly revising development strategies In many localities, this issue is considered a political task because the houses are not only meaningful in terms of social security but also in terms of political security.

Dong Nai has several advantages in terms of both natural and human resources due to its location in the Southeast area, enabling it to develop agriculture, industry, and services, contributing significantly to the regional economy As a result, this is an area with a high pace of urbanization According to the Dong Nai Statistics Department, approximately 1 million employees from other provinces and cities presently work in the area, accounting for more than 60% of all migrant workers Because the majority of workers are low-income, this indicates an increase in demand for owning and renting social housing With such a high demand for housing, Dong Nai province has always been active in providing accommodation for employees, and the program has yielded numerous beneficial results for migrant workers and students after the implementation of the program However, there are still restrictions in the program implementation process that are impeding the local's socio-economic development As a result, the group chose the topic "Analyze and evaluate the efficacy of the social housing development program in Dong Nai province from 2016 to 2020" to consider the program's effective and ineffective aspects and recommend strategies to improve it in subsequent phases.

2 Objectives of the essay

Analyze the effectiveness of the program by evaluating the development of social housing developments in Dong Nai over a 5-year period From there, identify the reasons for the program's ineffectiveness and give recommendations for improving the

effectiveness of the goal program of social housing construction in the locality in the coming years.

3 Research methods & data source

Data collection methods: The essay uses secondary data collected from government documents, local portals, online newspapers, and other sources about practicality in the development of social housing projects for residents in the area.

Data analysis methods: After being scientifically and statistically processed in line with the research, the data will be studied and presented in tables and graphs to evaluate the program's efficiency.

The secondary data source of the essay is mainly taken from Dong Nai Newspaper website, Dong Nai Department of Construction

4 Research object and scope

Research object: The province of Dong Nai's social housing building program for the years 2016 to 2020 is based on Decision No 4197/QD-UBND.

Scope of content: research on the content, implementation process, and results of the program implementation

Spatial scope: research in Dong Nai province Scope of time: research in the period 2016-2020

5 Structure of the essay

Chapter 1 Theoretical Basis

Chapter 2 Analysis and evaluation of the effectiveness of the social housing development program in Dong Nai province in the period 2016 - 2020 Chapter 3 Conclusions & Recommendations

CHAPTER 1 THEORETICAL BASIS

1.1 The concept of public expenditure and the evaluation of public expenditure

1.1.1 The concept of public expenditure

Public expenditure is a concept belonging to an economic category that has existed for a long time Public expenditure appears to be associated with the birth, existence, and development of the state Through different periods and stages of socio-economic development, the concept of “public expenditure” has also changed to a certain extent In fact, when discussing the concept of “public expenditure” there are many different views and interpretations.

“Public expenditures are expenditures made by the state in order to perform the inherent functions of the state in providing public goods and serving socio-economic benefits for the community” (Duong Thi Binh Minh, 2005) This stems from the state's function of comprehensively managing the socio-economic environment Public spending reflects government policies by providing financial resources for the implementation of those policies.

According to Assoc., Dr Su Dinh Thanh, “public expenditure reflects the value of goods purchased by the government to provide public goods for society to perform the functions of the state Public expenditure implements the policy of income redistribution.” The characteristic of public expenditure is its reimbursable or non-reimbursable nature, reflected in the fact that the results of public expenditure do not correspond to expenditures in terms of quantity, quality, time, and place Many government expenditures have long-term benefits that are difficult to quantify using the corresponding value criteria Public expenditure is a tool of the government to provide public goods for society, build infrastructure, allocate resources, distribute income, stabilize the macro-economy, and attract investment capital, private sector and economic restructuring

Thus, public expenditures are mainly those parts of the state budget that have been approved by the National Assembly Public expenditure creates a redistribution across sectors of the economy The government plays a central role in the income redistribution process Through public spending, the government provides society with the income it has

taken away by providing necessary public goods that the private sector is unable to provide or inefficiently provides.

1.1.2 The concept of evaluating public expenditures

Public expenditure assessment is the assessment of budget policy making and institutional building It is a key tool in analyzing public sector problems and explaining why it is necessary for the public sector to finance socio-economic activities (Public Finance Theory, Assoc.Prof.Dr Dinh Thanh & Dr Bui Thi Mai Hoai, 2006).

The need to assess public expenditure: state budget balance is one of the most basic components of national finance and is a prerequisite to ensuring healthy stability for the economy national finance, in which public spending is an important indicator that directly affects the state of the budget balance The basic purpose of public expenditure assessment is to help the government use public financial resources more efficiently by prioritizing expenditures to bring about practical benefits for economic development and society.

The content of the public expenditure assessment:

Overall, public expenditure assessment is an analytical process on two aspects: Qualitative aspect: evaluates the selection of public goods that the government should provide to society.

Quantitative aspect: considers the costs of providing public goods and the benefits that public goods bring.

On the basis of analyzing costs and benefits between public goods provided by the government, the government will have a basis for comparison and judgment to choose the right type.

1.2 The concept of social housing and the development of social housing

The concept “social housing” was first used in a legal document in 2005, when the “Law on Housing” defined it as “housing invested by the state, an organization, or an individual construction investment for lease or hire purchase by the entities indicated in Articles 53 and 54 of this Law.” “Social housing” is defined as “housing with state support for recipients of housing support policies in accordance with the Housing Law 2014”, according to the Law on Housing (2014).

However, author Hoang Vu Linh Chi defines social housing as “a type of housing owned by government agencies (can be central or local) or non-profit organizations built with the purpose of providing affordable housing to certain groups prioritized in society and allowed to rent or live in at a low price compared to the market price” in a research paper titled “Social Housing Policy of Vietnam.”

Therefore, the concept of social housing legalized in subsequent legal documents has an indirect definition, which can be understood as a type of housing built for disadvantaged groups in society, approved by the State Government The country gives priority to 10 types of subjects, of which the largest number are: poor and near-poor households in rural areas; low-income people; poor and near-poor households in urban areas; employees working inside and outside the industrial park; cadres, civil servants, and public employees; pupils and students.

1.2.2 Social housing development

Social housing development is the investment, construction, renovation and increase of housing area to provide for social objects, increase beneficiaries according to local regulations with the participation of more and more investors participating in the social housing development investment market Development of social housing is one of the important solutions to promote the development of the housing market, and at the same time provide housing support for social policy beneficiaries, low-income people and the poor housing difficulties in order to contribute to political stability and social security.

Contents of social housing development:

Development of social housing in terms of quantity: the development of social housing in quantity can be understood as the development of the construction floor area, the

development of the average floor area/household (or person), increasing the number of objects beneficiaries of social housing or the number of investors participating in the housing development investment market.

Development of the type of social housing supply: is to expand and diversify the types of housing supply so that more individuals can participate in the housing supply process, thereby increasing the budget housing development for society Currently, there are two basic types of supply: social housing built by the State with state budget capital for rent and social housing built with non-budget capital Government.

Development of social housing services: is to expand and diversify services provided so that beneficiaries of social housing increase opportunities to access housing services Currently, there are three forms of housing service provision including: sale, lease, lease-purchase according to local policies and subjects.

Improving the quality of social housing: is increasing the satisfaction level of beneficiaries of social housing through the following activities: improving the quality of design and construction to improve the quality of housing, thereby improving satisfaction through enjoying related services such as facilities, surroundings,

CHAPTER 2 ANALYSIS AND EVALUATION OF THE EFFECTIVENESS OFTHE SOCIAL HOUSING DEVELOPMENT PROGRAM IN DONG NAI

PROVINCE IN THE PERIOD 2016 – 20202.1 About the program

The National Housing Development Strategy to 2020 and Vision to 2030 was approved by the Prime Minister on November 30, 2011, based on Resolution No 117/2014/NQ-HDND dated 11/07/ 2014 of the Provincial People's Council on the adjustment of Resolution No 114/2008/NQ-HDND dated July 24, 2008 of the Provincial People's Council on the housing development program in Dong Nai province until 2010 and orientation to In 2020, the People's Committee of Dong Nai province decided to "Promulgate the plan for social housing development in Dong Nai province for the period 2016 - 2020" according to Decision 4197/QD-UBND The issued decision clearly states two main plans including the Social Housing Development Plan to 2020 and the Inn Development Plan Social housing development plan to 2020 with the total number of apartments in 5 years is 20,000 units, total capital is 12,280 billion VND The motel development plan forecast that by 2020, the number of motels will be 20,000 establishments with 150,000 rooms According to the plan, 80% of motels will meet the minimum standards prescribed by the Government and the province by 2020.

2.2 Program analysis

2.2.1 The necessity of the program

Vietnam is gradually developing quite quickly on the momentum of economic growth in the region and in the world, leading to problems with urban development and infrastructure, especially the lack of housing for people According to the General Statistics Office, as of 2016, the total urban population is 32.6 million people (accounting for 34.6% population), in which, workers are a large force, playing an important role in the development of industry, especially the manufacturing - processing industry of the country.

Dong Nai is one of the provinces with strong development in the fields of industry and services, providing jobs and a great source of income for people Therefore, a large number of immigrants come here to find opportunities for themselves, causing a serious

housing shortage The lack of housing for people is likened to a "debt" of the government to workers in the area According to statistics, there are up to 400,000 workers in the province, specifically, the province has only 3,500 social housing and 1,600 housing for workers, so only a few can find housing for themselves The rest have to live in makeshift inns On average, each motel room will have 5-6 people, the area falls in the range of 12-14 square meters, there are places where there is still a lack of sunlight and very bad living conditions Mr Cao Tien Dung - Chairman of Dong Nai Provincial People's Committee had honest sharing when going to the rescue, grasping the problem situation in the area: people had to live in rickety, lack of light inns for many months, Many…

In addition, because it is not possible to rent or buy social housing, workers have to rent accommodation to stay Most of the hostels lack living space and living conditions, so it is easy to spread diseases This emphasis is on SARS-COV-2, which caused an outbreak and difficult to control Recently, because of the serious epidemic situation and no income during a long period of job loss due to social distancing, many workers have chosen to "leave the city to return to their hometown", causing especially serious impacts to the context of the country's economy, especially the processing and export industries.

Therefore, the authorized levels and leaders in Dong Nai province need to quickly step up measures to soon implement the social housing project for officials, employees, employees, people have difficult circumstances… fully, in accordance with the criteria, items and decisions set forth by the State.

2.2.2 Objectives of the program

At the issues raised, the ultimate goal is still to serve the people and develop the country Understanding that, Dong Nai province has set the implementation goal for this project towards the interests of the people above all, specifically:

Regarding the demand for social housing in the area:

According to the data on the Department of Construction of Dong Nai province recorded through the implementation of census surveys in the province, especially in industrial - export processing zones, showing a relatively high housing demand From

2016 to 2020, the demand of working people for housing increases from 164,000 people to 190 thousand people According to predictions, this number will continue to increase in the future.

Purpose of building social housing project:

The development of social housing is also a strategy to encourage individuals to settle down and stay in the area in order to engage in productive activities, as well as to stay with the province in general and enterprises in particular Furthermore, the social housing project, which prioritizes the use of state resources, intends to focus on the construction of state-owned social housing for rent or sale in order to entice private investors (individuals, organizations) to help build and finish the program.

Implementation goal:

The goal is set out in the Resolution No 117/2014/NQ-HDND of the Provincial People's Council on July 11, 2014 on adjusting the Resolution 114/2008/NQ-HDND of the Provincial People's Council on the Housing Development Program in Dong Nai province until 2010 and orientation to 2020; Decision 4197/QD-UBND dated December 8, 2016 of the Provincial People's Committee approving the social housing development plan in Dong Nai province in the 2016-2020 period as follows: in the period 2014-2020, 21,500 houses will be built in society; Specifically, from 2014-2015 to build 1,500 apartments and from 2016 to 2020 to build 20,000 apartments.

With the current goal, it is necessary to determine that social housing development is not only a form of business, but also an activity in which enterprises show their interest, share with the state, in developing problems social security issue Therefore, the State needs to be responsible for supporting investment enterprises in terms of land funds, loans and contract procedures to shorten investment processes and procedures, thus attracting more businesses to participate into this field.

2.3 Market failure in Dong Nai housing development

The first market failure is that the real estate and specifically the housing is imperfect competition market.

Accompanying the development of Dong Nai urban area is the formation of new residential areas with a variety of housing types to meet the needs and abilities of all classes of residents Aside from the architecture, the house's value will be determined by the value of the land as well as the infrastructure or living environment in which it is situated As can be seen from the above, this is a market with a wide range of products.

A series of large projects on technological infrastructure have also been implemented as a result of the industrial park's advantage, making the land here a favorite location for many investors in recent years A string of transactions including the purchasing, selling, and transferring of projects has sparked a land and housing craze, driving up the cost of owning a home for consumers In addition, due to the value attached to the land, the housing supply will be constrained as the population grows, but the land area will remain fixed Finally, there is poor liquidity due to strict state management, so the transaction process is time-consuming.

The housing market, based on the aforementioned considerations, is an imperfectly competitive market Although this market has the potential to generate a lot of profit for businesses, it also has a lot of barriers to entry Furthermore, the fact that prices can readily alter in response to market fluctuations makes it difficult for people with low financial resources to pay.

2.3.2 Information asymmetry

The housing market is one of the markets where there is often asymmetric information for buyers because many people still do not understand the legal issues in transactions In recent years, Dong Nai is often mentioned with many "ghost projects", ranging from partitioning agricultural land into lots to selling to people in places where migrant workers abound These are the people who are easily duped and robbed of property because they have little knowledge of the issue of converting residential land in the area, and they simply buy because it is reasonable The effects of reverse selection