Mechanism management of state budget expenditures for science and technology activities in vietnam

The financial management mechanism in general, the state budget expenditure management mechanism in particular, for S&T activities has also been gradually renewed, gradually removing dif

INTRODUCTORY

1 The need of the research topic: The development of science and technology is a

particularly important issue, which has long been considered a top national policy and a driving force for socio-economic development The Central Committee of the Party (Second Central Committee, Term VIII in 1996) approved the Resolution on "Strategic orientations for development of science and technology in the period of industrialization and modernization and tasks to the year 2000" Then, at the Xth Congress, for the first time, our Party recorded in the document an important thesis on the development of the knowledge-based economy as a constitutive element of the industrialization and modernization of the country In the system of management mechanisms for S&T activities, the financial management mechanism plays an important role Finance is both a resource and a driving force for the development of science and technology The fact that financial resources are properly arranged and properly allocated is only one side of the problem, the other side is that there must be an appropriate financial management mechanism, built and implemented based on the characteristics of the financial institution S&T activities The financial management mechanism in general, the state budget expenditure management mechanism in particular, for S&T activities has also been gradually renewed, gradually removing difficulties and obstacles in the process of implementing S&T activities However, along with the development of the economy and society, the perfection of the economic management mechanism and the increasing requirements for the contribution of science and technology factors to the economy, the management mechanism has increased Finance in general, the state budget expenditure management mechanism in particular, for science and technology activities have also revealed many limitations and shortcomings in both theory and practice, thereby posing requirements that need to be researched and perfected in order

to improve the efficiency of state budget spending for S&T activities Stemming from the

above reasons, the author chooses the topic: "Mechanism management of state budget expenditures for science and technology activities in Vietnam"

2 Research purpose of the thesis: Through the research of this thesis, the author

wishes on the basis of theoretical and practical research, to propose solutions and recommendations to contribute to improving the cost management mechanism State budget

for S&T activities in Vietnam

3 Research tasks of the thesis

Firstly, systematize the theory of S&T activities; on financial management mechanism, state budget expenditure management mechanism for S&T activities; experience of some countries in this regard

Second, analyze and evaluate the current status of the state budget expenditure management mechanism for S&T activities in Vietnam In which, analyze and evaluate the current status of the state budget expenditure management mechanism according to the budget process, each type and level of S&T activities; by each method From there, clearly identify the achieved results, the remaining limitations in the mechanism of state budget expenditure management for S&T activities

Thirdly, on the basis of viewpoints, objectives and orientations for S&T development, assessing the actual situation of implementing state budget expenditure management for S&T activities, the thesis proposes objectives, views, orientations and solutions in order to improve the mechanism of state budget expenditure management for

S&T activities

The thesis focuses on solving the following issues: Concept and characteristics of S&T activities in the economy - society; mechanism of management of state budget expenditure in general and mechanism of management of state budget expenditure for S&T activities; Overview of state budget expenditures for the S&T sector in Vietnam; Mechanism of allocation, management and use of state budget expenditures for S&T activities in Vietnam; Solutions to improve the mechanism of state budget expenditure management for S&T activities in Vietnam

4 The object and scope of the study of the thesis

- Research object: Theoretical and practical issues of S&T activities; mechanism for management of state budget expenditures for S&T activities

- Scope of research: In terms of space, the thesis focuses on studying the issue of the state budget expenditure management mechanism for S&T activities, including the state budget expenditure management mechanism according to the budget cycle to perform the S&T tasks of the S&T activities granting, the allocation mechanism and the Fund mechanism in S&T activities In terms of time, the thesis mainly uses the data of state budget expenditures for science and technology from 2017 to 2022 In some cases, the thesis uses time series data through periods to get an overview of both progress

5 Research method: The thesis uses common scientific research methods, and at

the same time uses theoretical research methods and practical research methods Data collection: Secondary data sources are data from the Ministry of Finance, the Ministry of Science and Technology and data from published research works

6 New contributions of the thesis

(1) General contribution: The thesis is the first work to classify the state budget

expenditure management mechanism for S&T according to the criteria of the budget process and the criteria of the method of budget expenditure management for activities S&T activities; At the same time, research on the management mechanism of state budget expenditure for S&T activities in both directions has also been carried out, both according to

the budget process

(2) In theoretical: The thesis has presented some theoretical issues about

management mechanism, financial management mechanism and state budget expenditure management mechanism for S&T activities At the same time, the thesis introduces its own concept and points out the characteristics, principles and content of the state budget expenditure management mechanism for S&T activities

(3) In practical: The thesis has assessed the status of the state budget expenditure

management mechanism for S&T activities in Vietnam according to the budget cycle, from three angles: Mechanism of management of state budget expenditure for S&T tasks at all levels; Mechanism of contract spending to perform S&T tasks; Mechanism of management

of state budget expenditure through S&T funds

(4) Regarding solutions: Based on the analysis of the current situation and

orientation of the Party and State, the thesis has proposed a system of solutions to improve the mechanism of state budget expenditure management for S&T activities In which, it proposes solutions to improve the state budget expenditure management mechanism for

S&T tasks at all levels and perfect the management mechanism for S&T funds in Vietnam

7 Thesis structure

Beside of the introduction, conclusion, the thesis is structured into 3 chapters:

Chapter 1: Theoretical basis for S&T activities and the mechanism of state budget expenditure management for S&T activities

Chapter 2: The current situation of the state budget expenditure management mechanism for S&T activities in Vietnam

Chapter 3: Solutions to improve the state budget expenditure management mechanism for S&T activities in Vietnam

8 Overview of the related researchs to the thesis

8.1 Overseas researchs

(1) On funding for S&T: Research by Walter W Powell, Jason Owen-Smith (2007)

in “Innovation and simulation: lessons from US universities selling private ownership to becoming General knowledge shows that building a suitable financial mechanism between research and applied units will have mutual support and influence in S&T research activities Research by author Charly.J (2012) on "Building a mechanism to share scientific data internationally" suggests that, in addition to investment by governments, should be attracted from businesses, by businesses Industry is the one who needs and benefits greatly from sharing scientific data

(2) On financial mechanism for S&T: Research by Charly.J (2012) [86], Building a

mechanism to share scientific data internationally The author's research proposes the establishment of a non-profit trust fund This fund is operated with the financial mechanism

of contributions of countries as member countries This fund will be used in part for scientists to research and build databases

(3) About the evaluation of investment efficiency for S&T

Research by author Terry F Young (2013) [93], Evaluation of research effectiveness

at US environmental protection agency The author believes that in order to effectively operate a financial mechanism for S&T research activities, it is necessary to build a system

of evaluation criteria as well as a set of tools to evaluate the effectiveness of scientific research

In the Framework for Assessment of Science and Technology Development Policy of UNCTA (2011), it is shown that: countries have grounds for strategic planning, policy formulation as well as application of financial mechanisms in accordance with the provisions of the law conditions for each country to promote scientific and technical development

Authors Amir Piric and Neville Reeve (2015) with "Assessment of public investment activities for science and technology development" propose studies to use financial criteria

to evaluate projects when selecting projects selection and evaluation of research results Research by George Papaconstantinou and Wolfgang Polt (2016) in "Financial Policy Evaluation in Science and Technology Innovation" mainly focuses on macro level, the research has not mentioned the implementation as well as building financial mechanism at scientific research institutions has not been specified, not yet specifying the conditions and operating models of scientific research institutions to be able to apply and operate the

approved financial mechanism Proposal works as expected

Research by author Dat Khang (2015) in "Need to renew financial mechanism and mobilize investment for S&T suggests that 2% of budget expenditure for S&T activities belongs to the group of countries with a high rate The study makes a proposal to pay high salaries to scientists and pilot a mechanism of contracting payments to the final product and the state will buy back S&T products

Author Dr Nguyen Thi Nhung (2014), "The current status of the financial mechanism for S&T activities in Vietnam in the recent period" has pointed out 5

outstanding issues about the financial management mechanism for S&T activities

(2) Studies on the legal basis for the state budget expenditure management mechanism for S&T activities:

Author Lieu Thi Ngoc Suong in "Innovation of financial mechanism for S&T activities" has proposed a number of issues that need to be amended and supplemented in the financial mechanism for S&T activities, conditions for selected tasks to be assigned stock to the final product

Author Minh Tien (2007) in "New Financial Mechanism for Science and Technology" pointed out the innovations in financial mechanism for S&T at the time of the research This is a breakthrough policy to create conditions for organizations and individuals

to apply scientific and technological results to production and business

(3) Studies on the current situation and proposed solutions to improve the state budget expenditure management mechanism for S&T activities:

Research by Assoc Prof Dr Le Xuan Truong (2014), "Financial mechanism for S&T: From international practice to Vietnamese practice" suggests it is necessary to learn from experiences from advanced countries, This is a necessary job for developing countries like Vietnam

Author GS.TS Ngo The Chi in "Research on theoretical and practical basis for building a mechanism for creating, managing and using sources to form science and technology development funds in enterprises" proposes solutions to increase investment in science and technology development in Vietnam enterprises, financial mechanism, management mechanism, and use of financial resources for S&T development in Vietnamese enterprises in the coming years

Author Dr Nguyen Truong Giang (2012) on “Renovation of financial mechanism for S&T” pointed out the shortcomings of financial mechanism for S&T activities; propose a group of solutions in the management and use of state budget funds; science and technology sector

(4) Regarding the evaluation of investment efficiency for S&T:

The authors Amir Piric and Neville Reeve (2015) in "Evaluating public investment

activities for S&T development" propose to use financial criteria to evaluate projects when selecting and appraising research results rescue

Authors George and Wolfgang Polt (2016) in the new "Financial Policy Review in Science and Technology Innovation" mainly focus on the macro level, the research has not mentioned the implementation as well as the construction of financial mechanism in

Vietnam scientific research institutions

8.3 Achievements and gaps in research on the mechanism of state budget expenditure management for S&T activities

(1) General assessment of the results achieved by the research works: All the

research results published above are important sources of material inherited and developed

by the thesis author However, the published works show that there are still issues that have not been mentioned or mentioned comprehensively With this thesis, the author wishes to contribute to overcome those gaps

(2) Gaps in research on the management mechanism of state budget expenditure for S&T activities

Firstly, the authors mainly focus on research on the results, effectiveness of S&T activities and criteria for evaluating the results of S&T activities, but have not gone deep into systematizing the methods of operation and organization scientific and technological activities as a basis for research according to each method and content

Secondly, most of the studies have studied and considered the issue of financial management mechanism, the state budget for S&T activities as a whole, there have not been studies looking at the issue of financial management mechanism, state budget for different groups of S&T subjects to show the suitability and inadequacy if the same model is applied

Third, most of the solutions are still general, lacking specific and detailed solutions, associated with the reality of state budget expenditure management for S&T activities

From the point of view of inheriting and developing from previous studies, the thesis focuses on in-depth research on the mechanism of state budget expenditure management for S&T activities in Vietnam, contributing to overcome the gaps that have not been mentioned fully in previous studies

CHAPTER 1: THEORETICAL BASIS FOR S&T ACTIVITIES AND THE MECHANISM OF STATE BUDGET EXPENDITURE MANAGEMENT FOR S&T

ACTIVITIES

1.1 Science, technology and science and technology activities

1.1.1 Concepts of science, technology and S&T activities

1.1.1.1 Science: Science is understood as the collection of understandings about

nature, society, and thought expressed by inventions in the form of theories, theorems, laws, and principles Thus, the essence of science is the discovery of phenomena whose properties inherently exist objectively This discovery has changed human perception, facilitating research and application of this knowledge in practice

1.1.1.2 Technology: From the results of research and analysis of the above concepts,

based on the reality at the present time, the author proposes the concept of technology as follows: Technology is a set of systematic solutions that are established used in the process

of creating a product, completing a work or performing a certain service to serve a specified purpose

1.1.1.3 S&T activities: These are activities on “scientific research, experimental

research and development, technology development, technology application, S&T services,

promotion of initiatives and other creative activities for development S&T”

1.1.2 Characteristics of S&T activities: S&T activities are a kind of creative

intellectual work; High risk of S&T activities, unpredictable research process and expected results; S&T activities are inherited and cumulative; S&T activities are always associated

with training and production needs

1.1.3 The role of science and technology in the economy: Promoting economic

growth and development; Promote economic restructuring towards progress, increase the proportion and position of GDP of the industrial sector, the service sector, reduce the proportion of the agricultural sector; Improve the competitiveness of enterprises and the economy

1.2 State budget expenditure for S&T activities

1.2.1 State budget and state budget expenditures for S&T activities: According

to the 2015 State Budget Law: “State budget is all revenues and expenditures of the State that are estimated and realized in a certain period of time, by competent state agencies

decisions to ensure the performance of the State's functions and tasks"

1.2.2 Contents of state budget expenditures for S&T activities: State budget

expenditures for S&T activities are all expenditures from the state budget for S&T activities If fully calculated, this expenditure includes direct expenditure from the state budget and indirect expenditure through funding policies outside the state budget, such as tax exemption and reduction policies and other indirect expenses However, within the scope of the thesis, the author focuses on the content of direct expenditures from the state budget for S&T activities, including:

1.2.2.1 S&T investment and development expenditure: S&T development investment

expenditure is an irregular expenditure for the purpose of building infrastructure, material and technical facilities for S&T organizations regardless of economic sectors

1.2.2.2 Recurring expenditures for science and technology: Recurring expenditures

for science and technology are expenditures incurred regularly, continuously, annually,

1.2.3 Characteristics of state budget expenditure for S&T activities: State budget

expenditures for S&T activities are expenditures for intellectual labor to meet and stimulate the ability and creative needs of scientists; State budget expenditure for S&T activities is

risky

1.2.4 The role of state budget expenditure for S&T activities: The role of the

state budget for S&T in each country and in each period is different However, whether the proportion is high or low, state budget expenditure still plays a very important role in S&T development in all countries for the necessary S&T fields, but the private sector cannot or does not want to invest as in basic research

1.3 Mechanism of management of state budget expenditure for S&T activities

1.3.1 Financial management mechanism and state budget expenditure management mechanism for S&T activities

1.3.1.1 The concept of financial management mechanism: Financial management

mechanism is a collection of measures and organizational forms to manage the process of creating, distributing and using financial resources Thus, the definition of financial mechanism given in the Dictionary of Economic Terminology is the definition of "financial management mechanism" (a subjective category), not the definition of "financial mechanism" finance”, (an objective category)

1.3.1.2 Mechanism of management of state budget expenditures for S&T activities: The mechanism of management of state budget expenditures for S&T activities is

a combination of measures and organizational forms to manage the process of making, implementing and finalizing state budget expenditures for S&T activities S&T activities with three main functions: (i) Stimulating S&T development, through the operation of financial and state budget mechanisms and policies; (ii) Regulating S&T relationships among stakeholders through financial and state budget relations; (iii) Control economic

activities through the mechanism to control the movement of cash flow

1.3.2 Characteristics of state budget expenditure management mechanism for S&T activities: Firstly, the financial management mechanism in general and the state

budget expenditure management mechanism in particular for S&T reflect the financial relationship between scientific research organizations and state and society; Secondly, the mechanism of management of state budget expenditure for S&T activities is implemented in the context that financial sources for S&T activities are very diverse; Third, the organization, distribution and mobilization of financial resources for S&T are determined by

the characteristics of the economic mechanism

1.3.3 Contents of the mechanism for managing state budget expenditures for S&T activities

1.3.3.1 Mechanism of management of state budget expenditure for S&T activities according to the budget cycle:

Every year, the State organizes the formulation of budget plans for S&T based on two bases: Firstly, based on the needs proposed by S&T organizations, scientists, businesses and other organizations and approved by the Government approved by the management agency in charge of science and technology Second, based on the state budget's ability to balance

Basically, the budget cycle for the S&T sector from the state budget is carried out through 3 main steps: Step 1: Proposing a plan and making a budget estimate; Step 2

Allocate budget expenditure estimates; Step 3 Advance or pay and finalize expenses

1.3.3.2 Mechanism of management of state budget expenditure for S&T activities by mode of expenditure

⁃ Method of actual payment and expenditure according to actual arising: Expenses

are allocated according to norms to perform research tasks as planned or as required This method has the advantage of being simple and easy to manage, but has the disadvantage of being heavily administrative and subsidized

⁃ Method of contracting and purchasing scientific research results in S&T activities:

Contract spending is the assignment of financial autonomy to organizations and individuals

presiding over S&T tasks in the use of funds already approved by competent agencies approval authority, associated with responsibility for the results of the assigned task The contract payment method includes the payment package to the final product and the partial

payment package

- Method of purchasing research results: The purchase of scientific research results

is a higher development step of the contract payment method This method is implemented when the following conditions are satisfied: (i) S&T research tasks with results of scientific research and technological development that need to be purchased are valuable for socio-economic development; (ii) There are organizations and individuals committed to applying and using the results of scientific research and technological development; (iii) Organizations and individuals undertaking scientific research and technological development accept the appraisal process of content and funding according to current regulations of competent state agencies, commit to self-mobilizing funding to carry out

characteristics of science and technology activities

1.3.3.4 Financial inspection and supervision mechanism in S&T activities: The

financial inspection and supervision mechanism in S&T activities is a collection of methods, forms and tools established to inspect and supervise the mobilization of funds mobilize, distribute and use financial resources for the field of science and technology to

ensure the right objectives and ensure efficiency

1.3.4 Principles of state budget expenditure management for S&T activities

- Management of state budget expenditure in general and state budget expenditure for S&T activities in particular must ensure the principle of overall fiscal balance

- Management of state budget expenditures for S&T activities must ensure the minimum requirements on capital sources for S&T activities and fulfill spending commitments

- Management of state budget expenditures for S&T activities must ensure efficiency

in resource allocation and promote S&T agencies and organizations to provide high quality S&T products

- Management of state budget expenditures for S&T activities must promote the socialization of S&T activities, gradually reducing and eventually eliminating the state of subsidies in S&T activities

- Management of state budget expenditures for S&T activities must ensure financial discipline

- Management of state budget expenditures for S&T activities must ensure publicity and transparency

1.4 Factors affecting state budget expenditure for S&T activities

1.4.1 Objective factors

(1) Socio-economic conditions and capacity of public financial resources: State

budget expenditure estimates are made based on mobilized public financial resources, that

is, based on actual revenue collection in previous years and revenue growth forecast this year, and also based on socio-economic development tasks

(2) Mechanisms, policies and regulations of the State on management of state budget expenditure: In the market economy with state regulation, law has become an indispensable

part of State management general and state budget expenditure management in particular The legal system with the role of guiding and creating conditions for economic sectors in society to operate in order, within the legal framework to ensure fairness, safety and efficiency requires a very complete , normative and synchronous

1.4.2 Subjective factors: Management capacity of leaders and professional

qualifications of staff in the state budget expenditure management apparatus, organization

of state budget expenditure management apparatus as well as professional processes and management technology state budget expenditure management

1.5 International experience on the mechanism of management of state budget expenditures for S&T activities

1.5.1 Mechanism for management of state budget expenditures for public research institutions in OECD countries

(1) Appropriation: Funding is a mechanism by which a government or a budgeting

agency allocates an annual amount of funding to a research institution unconditionally, not for a project or program and the research institution is free to use the funds as it wishes

(2) Project-based budget allocation: The project-based budget allocation mechanism

is implemented to meet the public sector's requirements for transparency and accountability

in S&T spending State budget spending on scientific research is increasingly directed towards performing tasks on the basis of contracts and output criteria In the long term, the funding mechanism will be gradually reduced, replaced by a contract allocation mechanism with definite term and allocation according to specific research programs

1.5.2 Financing mechanism for public research institutions in Korea: Public

research institutions in Korea are divided into 4 categories based on management mechanism and financial mechanism: Government-owned research institutes grants (GRI); National Laboratories; Research institutes funded by local governments; Local laboratories Among the above four types of organizations, GRIs are the most important public research institutes, with the largest scale and areas of activity Therefore, this paper is limited to the scope of research on financial mechanism for GRIs

1.5.3 Financial Mechanisms for Public Research Institutions in China

(1) The State orients and develops according to goals with appropriate policies, consistent with economic and innovation policies

(2) Mobilizing appropriate resources: In order to mobilize a variety of resources, China has aimed to change not only the innovation component such as research institutes or educational and training institutions, but also strengthen environment for innovation

(3) Organization and management of R&D and technology The emergence of new technologies is multidisciplinary in nature

1.5.4 Lessons learned from the study of financial management mechanisms for S&T in some countries

First, sources of research funding tend to be more diverse In addition to the state budget, the proportion of sources from cooperation with the business sector, cooperation with foreign countries or from the public-private partnership model is increasing

Secondly, the mechanism of budget allocation according to the competitive method is

a measure applied by many countries and achieved good results, but there are also disadvantages that need to be overcome

Third, in the area of budget spending for S&T, the general trend is to gradually replace the whole method of contracting funding with a partial contract, and the part changes depending on the project or the results of research activities

Sub-Conclusion Chapter 1

Chapter 1 has systematized the basic theories on concepts, characteristics and roles of S&T activities; clarify the factors affecting the development of S&T Chapter 1 also presents some theoretical issues on management mechanism, financial management mechanism and state budget expenditure management mechanism for S&T activities The thesis also introduces the experience of financial management mechanism and state budget for S&T activities in some countries around the world and in the region, thereby drawing lessons for Vietnam

The new point expressed by the author in this chapter is that he has presented and introduced his own concept of the financial and state budget management mechanism for S&T activities, and pointed out 3 characteristics, 6 principles and contents of the mechanism State budget expenditure management system for S&T activities The thesis has for the first time introduced the criteria for classifying the content of the state budget management mechanism for S&T activities, including: Management mechanism according

to the budget process; Management mechanism by mode of expenditure; Management mechanism according to the fund model This classification criterion is also the basis for research in the next parts of the thesis

CHAPTER 2: THE CURRENT SITUATION OF THE STATE BUDGET EXPENDITURE MANAGEMENT MECHANISM FOR S&T ACTIVITIES IN

VIETNAM 2.1 S&T activities and state budget spending on S&T activities in Vietnam 2.1.1 S&T organization and decentralization of S&T activities in Vietnam

2.1.1.1 S&T organizations: According to the Ministry of Science and Technology,

by 2020, Vietnam has about 4,100 organizations registered for S&T activities (an increase

of nearly 2 times compared to 2014), of which there are 1,900 public organizations and nearly 2,200 organizations non-public There are about 173,000 people involved in research and development

2.1.1.2 Decentralization of S&T tasks: According to the 2013 Law on Science and

Technology, S&T tasks using the state budget are classified into 5 levels: national level, ministerial level, provincial level, grassroots level and (special) level

2.1.2 Results of S&T activities in Vietnam: The development of S&T in our

country over the past time is reflected in the following activities: Firstly: The national S&T potential is growing Up to now, the country has more than 4,000 S&T organizations, 3 national hi-tech parks, 13 hi-tech agricultural parks, and 8 concentrated information technology zones The number of staff directly doing research has reached about 67,000 people Second: Vietnam's science and technology level has improved markedly Third: S&T activities are not limited to the state sector, but have spread to businesses and the community , towards approaching international practices and standards The fifth is: The training of scientific staff is respected by the State, reflected in many projects and projects

on training cadres

2.1.3 State budget expenditure for S&T activities in Vietnam in the past time

The period 2016-2020 is a relatively stable period in terms of policies and regimes in the field of science and technology, as well as investment from the state budget for science and technology However, according to the Law on Public Investment (effective from the

2017 budget year), this period marks the handover of autonomy in resource management decentralization from the state budget to science and technology between central and local governments Accordingly, the National Assembly only assigns the total amount of development investment spending from the state budget, not detailing each spending area as before Therefore, from 2017 it is not possible to calculate the total expenditure on development investment for S&T of the whole country As for recurrent expenditures, in the period 2016-2020, the state budget always allocates higher spending on science and technology next year than the previous year, if in 2016 it is 10,471 billion VND, then in

2020 it has increased to 14,042 billion VND from the state budget 60,771 billion VND (Table 2.1), an average increase of 6.9%/year, of which the central budget spends 47,670 billion VND, equaling 78.4%, the local budget spends 13,101 billion VND, equaling 21.6

%

Period 2021-2022: Due to the impact of the Covid-19 pandemic, investment resources from the state budget for science and technology in the period of 2021-2022 show that the growth has not corresponded to the growth rate of the total state budget expenditure During this period, the allocation for S&T decreased to the same level as in 2016-2018 and was mainly due to a reduction in recurrent expenditure on S&T at the central level

2.1.4 General comment on state budget expenditure for S&T activities in the past time: Over the past 20 years, state budget expenditure for S&T activities has really

made great strides, having a strong impact on the development of the S&T career International comparison shows that Vietnam has a lot of potential for developing S&T and innovation capacity, but has not yet been invested at the optimal level It is encouraging that S&T development has contributed to enhancing Vietnam's position in the international arena, Vietnam's ranking on the Global Innovation Index (GII) has been improved In 2022, this index of Vietnam has risen to 48th position out of 132 ranked countries/economies, up

11 places compared to 2016, up 28 places compared to 2012

2.2 Mechanism of management of state budget expenditure for S&T activities

Up to now, both types of legal documents have been promulgated quite fully and synchronously, specifically: System of Laws in the field of S&T, Legal documents on

financial management in the field of S&T

2.2.2 The current status of the general management mechanism for state budget expenditures for S&T activities

2.2.2.1 Mechanism for making and assigning cost estimates

⁃ Budgeting process (including 4 steps), carried out from June to November every year:

Step 1 Annually, the State organizes the development of budget estimates, including S&T activities and provides guidance documents for the preparation of the estimates

Step 2 The unit using the budget, prepares the state budget expenditure estimate of its organization or unit, that is, determines the amount of funds needed to carry out its S&T activities and sends it to the governing body (Management ministries, local People's Committees)

Step 3 The governing bodies review and summarize the estimates of S&T organizations and send them to the ministries assisting the Government in science and technology, investment and finance for synthesis and appraisal

Step 4 Ministries assisting the Government in science and technology, investment and finance exchange, discuss and agree on plans and state budget estimates for science and technology for ministries, sectors and localities; submit to the Government and the National Assembly for consideration and decision the state budget expenditure estimates for S&T activities

⁃ Bases for making budget estimates of S&T tasks: Objectives, requirements,

contents and research workload of S&T tasks have been approved by competent authorities; The economic - technical norms are promulgated by functional ministries and branches, the norms serve as a basis for making estimates and the current regimes and policies of the State In case there is no economic - technical norm, it is necessary to explain in detail the

basis for making the estimate

⁃ Mechanism for assigning estimates for the performance of S&T tasks to S&T organizations: After the S&T activities cost estimates are approved by the National

Assembly, the governing bodies shall distribute the estimates to S&T organizations, units and agencies the use of the affiliated budget (for localities, the plan for allocating state budget expenditures for S&T activities needs to ensure that it is not lower than the level

decided by the National Assembly)

2.2.2.2 Mechanism for performing S&T tasks and payment of funds to organizations and individuals: Payment of state budget funds for S&T activities is made according to each

type of expenditure There are three basic types of expenditure: investment expenditure, recurrent expenditure and research expenditure As for the contents of investment expenditure, the payment shall comply with regulations on payment of investment capital; for the contents of recurrent expenditures for S&T organizations shall comply with

regulations suitable to each spending content (salary, procurement, )

2.2.2.3 S&T budget settlement mechanism: The settlement of funds for performing

S&T tasks using the state budget shall comply with the provisions of the State Budget Law, the Law on Science and Technology and guiding documents The reality of the past time