Investment
MoLISA draft to increase retirement age
The retirement age of Vietnamese labourers is proposed to be increased from 2021.
Vietnam is considering increasing the retirement age to 62 for males and 60 for females, effective from 2021, according to a draft amendment of the Labour Code.
The Ministry of Labour, Invalids and Social Affairs (MoLISA) is consulting relevant ministries and agencies on the draft Labour Code on the retirement age, proposing two options.
The first option would be to maintain the current retirement ages of 60 for males and 55 for females. The second option would follow the first until January 1, 2021, after which it would make incremental increases of 6 months until reaching the age of 62 for males and 60 for females, according to MoLISA's draft.
The draft also argues that the retirement age needs to be raised to balance pension funds and the expenses paid for deceased pensioners in the long term. The State pension funds could not rise to meet these expenses unless changes were made in short order, according to MoLISA.
This imbalance is forecasted to reach serious levels by 2023, when the State budget would fall below the demand, according to International Labour Organization (ILO) estimations.
However, there are some disagreements over the proposed increase of the retirement age, according to MoLISA’s draft law, citing employers resisting any change to the current regulations. “Some said that increasing the retirement age may reduce their benefits and other social welfare allowances,” MoLISA said.
Some even said that this proposal only benefits public servants in the State sector since it adds value to senior State officials, MoLISA further added. MoLISA expects to submit the proposal to the National Assembly in May 2019, to have it possibly finalised in October 2019.
The Vietnamese labour force (from 15 years old and upward) is estimated at 54.8 million people in 2017, according to the General Statistics Office (GSO).
Working-age labour force is estimated at 48.2 million in 2017, up some 511,000 year-on-year. Working-age labour force in urban areas accounts for 33.4%, while those in rural areas account for 66.6%.
The Ministry of Labour, Invalids and Social Affairs (MoLISA) is consulting relevant ministries and agencies on the draft Labour Code on the retirement age, proposing two options.
Vietnam is considering increasing the retirement age to 62 for males and 60 for females
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The first option would be to maintain the current retirement ages of 60 for males and 55 for females. The second option would follow the first until January 1, 2021, after which it would make incremental increases of 6 months until reaching the age of 62 for males and 60 for females, according to MoLISA's draft.
The draft also argues that the retirement age needs to be raised to balance pension funds and the expenses paid for deceased pensioners in the long term. The State pension funds could not rise to meet these expenses unless changes were made in short order, according to MoLISA.
This imbalance is forecasted to reach serious levels by 2023, when the State budget would fall below the demand, according to International Labour Organization (ILO) estimations.
However, there are some disagreements over the proposed increase of the retirement age, according to MoLISA’s draft law, citing employers resisting any change to the current regulations. “Some said that increasing the retirement age may reduce their benefits and other social welfare allowances,” MoLISA said.
Some even said that this proposal only benefits public servants in the State sector since it adds value to senior State officials, MoLISA further added. MoLISA expects to submit the proposal to the National Assembly in May 2019, to have it possibly finalised in October 2019.
The Vietnamese labour force (from 15 years old and upward) is estimated at 54.8 million people in 2017, according to the General Statistics Office (GSO).
Working-age labour force is estimated at 48.2 million in 2017, up some 511,000 year-on-year. Working-age labour force in urban areas accounts for 33.4%, while those in rural areas account for 66.6%.
