Submit to the Prime Minister a plan for managing national railway infrastructure assets

The Ministry of Transport has just issued Document No. 10865/TTr-BGTVT requesting the Prime Minister to consider and approve the Project on Management, Use and Exploitation of National Railway Infrastructure Assets Invested and Managed by the State.

According to the Ministry of Transport, the Project on Management, Use and Exploitation of National Railway Infrastructure Assets Invested and Managed by the State (the Project) aims to separate the state management function of state agencies from the business activities of enterprises and improve the efficiency of using this asset worth tens of thousands of billions of VND.

The important content of the Project is the assignment of management and use of national railway infrastructure assets and the maintenance of national railway infrastructure.

Accordingly, the Ministry of Transport proposed to assign Vietnam Railway Corporation (a railway infrastructure business enterprise with 100% state-owned charter capital) to manage, use and exploit national railway infrastructure assets without calculating the state capital component in the enterprise until the end of 2030.

After the Project is approved, assign Vietnam Railways Corporation to develop a Project to exploit national railway infrastructure assets; study and identify suitable assets to report to competent authorities for consideration and decision on asset allocation in the form of investment.State capitalat enterprises in accordance with the provisions of law on management and use of public assets, law on management and use of state capital invested in production and business at enterprises, law on railways and other relevant laws to effectively exploit the national railway infrastructure.

Regarding the mechanism for implementing the management and maintenance of national railway infrastructure assets invested by the State, the Ministry of Transport recommends that the Vietnam Railway Authority place orders with the Vietnam Railway Corporation to carry out the management and maintenance of national railway infrastructure according to the provisions of Decree No. 32/2019/ND-CP regulating the assignment of tasks, ordering or bidding for the provision of public products and services using the state budget.

Vietnam Railways Department places orders with Vietnam Railways Corporation for the management of periodic repairs of works, emergency repairs, overcoming the consequences of storms and floods step 2, inspection, monitoring and other tasks for a number of tasks of the investor. Vietnam Railways Corporation implements the above tasks according to the provisions of law on construction works.

The Ministry of Transport said that during the process of developing the Project, the Ministry of Transport considered 3 options. In which, option 1 is that the Government agrees to assign the Ministry of Transport (Vietnam Railway Authority) to place an order with Vietnam Railway Corporation to provide public services for management and maintenance of national railway infrastructure.

For periodic repairs, emergency repairs, overcoming the consequences of storms and floods step 2, inspection, monitoring and other works, it is recommended that the Government and the Prime Minister appoint Vietnam Railway Corporation as the project management consultant for periodic repairs; organize implementation in accordance with the provisions of law on investment in construction works.

Option 2 is the proposed option in Document No. 10865/TTr-BGTVT. In option 3, the Ministry of Transport assigns the budget to Vietnam Railway Corporation to perform the task of maintaining national railway infrastructure assets.

Deputy Minister of Transport Nguyen Danh Huy said that options 1 and 2 are basically implemented in a similar way, except that the option of appointing Vietnam Railways Corporation as the project management consultant (option 1) instead of ordering periodic railway repair management work to perform some tasks of the investor (option 2).

Both options have certain advantages and disadvantages and cannot satisfy all legal regulations on railways, investment management and public asset management.

Regarding option 3, the Ministry of Transport said that it is necessary to amend some legal provisions, as well as request competent authorities to issue a Resolution of the National Assembly, a Resolution of the Government and the feasibility of amending legal provisions in the above direction is not high. Therefore, it will lead to a delay in approving the Project, as well as not being able to apply it to the management and maintenance of national railway infrastructure for 2024 and the following years.

"To ensure the progress of the Project is approved soon, the amendment of legal documents must be at least, according to the provisions of law, the Ministry of Transport recommends choosing option 2 according to the direction of the Prime Minister in Official Dispatch No. 6089/VPCP dated September 15, 2022 and the consensus of ministries, branches, and Vietnam Railways Corporation", the leader of the Ministry of Transport informed.

After the Vietnam Railway Corporation was transferred to the State Capital Management Committee at Enterprises in 2018, the determination of the unit assigned to the railway maintenance capital (about 2,500-3,000 billion VND) was continuously delayed after the Ministry of Finance stated that assigning the railway economic career budget to the Vietnam Railway Corporation as in 2019 was not in accordance with the provisions of Clause 1, Article 49, State Budget Law and Clause 1, Article 31, Decree No. 163/2016/ND-CP guiding the State Budget Law, on budget management decentralization and the relationship between budgets at all levels. The reason given was that the Vietnam Railway Corporation is not a budget subject under the Ministry of Transport.

Due to the above difficulties, the assignment of budgets and signing of railway infrastructure maintenance contracts for 2020 and 2021 can usually only be carried out in the second quarter, after the Government issues a Resolution to temporarily remove difficulties, causing difficulties for all parties involved, instead of being implemented right from the beginning of the year.