2 options
According to the draft Decree adjusting pensions, social insurance allowances (BHXH) and monthly allowances, the Ministry of Home Affairs proposes 2 options for increasing pensions and allowances.
With option 1: From July 1, 2026, adjust an additional increase of 4.5% and 200,000 VND/month on the pension level, social insurance allowance and monthly allowance of June 2026 for the specific subjects specified in the draft Decree; adjust an additional increase of 8% on the social insurance allowance and monthly allowance of June 2026 for other subjects specified in the draft decree.
With option 2, from July 1, 2026, adjust to increase by an additional 8% on the pension level, social insurance allowance and monthly allowance of June 2026.
Explaining how to adjust pension increases
According to the draft submission, the Ministry of Home Affairs explains the proposal on how to adjust and combine according to relative numbers (percentage) and absolute amounts.
The drafting agency said that the adjustment of pensions and allowances is based on the provisions of the Law on Social Insurance. The Law states that pensions are adjusted based on the increase in the consumer price index in accordance with the capacity of the state budget and the Social Insurance fund, and at the same time, the appropriate adjustment of pension increases for subjects with low pensions and retired before 1995 ensures narrowing the pension gap between retirees in different periods.
Therefore, the Ministry of Home Affairs has coordinated with relevant ministries and sectors to report to the Government to submit to competent authorities for consideration and decision on the adjustment level of pensions, social insurance allowances and monthly allowances in 2026.
This proposal is based on forecasts for the increase in the consumer price index in 2026 and raising the living standards of retirees.
Accordingly, the 8% adjustment level has been approved by competent authorities. "However, applying a general adjustment level of 8% for all people receiving pensions, social insurance allowances, and monthly allowances will not overcome the current limitations in pension adjustment" - the draft submission of the Ministry of Home Affairs stated.
The limitation of the above content is that it has not been possible to institutionalize the viewpoint in Resolution No. 28-NQ/TW aimed at changing the way pensions are adjusted in a sharing direction.
In addition, this adjustment plan has not reduced the issue of pension differences between people with low pensions and high pensions after the adjustment is implemented; at the same time, it has not met the expectations and aspirations of the majority of people currently receiving pensions.
Based on statistics provided by the social insurance agency, people currently receiving pensions, social insurance allowances and monthly allowances mainly belong to the group with a benefit level from 3 million VND/month to less than 10 million VND/month with a total number of more than 2.4 million people, accounting for nearly 80%.
For the State budget source, the average pension level is 5.7 million VND/person/month; the average social insurance allowance (loss of working capacity) is 3.3 million VND/person/month; the average monthly allowance is from 2.2 million VND to 2.5 million VND/person/month.
For the guaranteed social insurance fund, the average pension level is 6.7 million VND/person/month; the average benefit level for commune and ward officials is 2.7 million VND/person/month.
Therefore, when the implementation of pension adjustment combines adjustment according to relative numbers, for those with low pensions, social insurance allowances and monthly allowances, they will receive a relatively higher adjustment level above the current pension and allowance level.
According to the drafting agency, this shows more sharing than simply adjusting according to the adjustment level according to the relative increase (percentage). Meanwhile, it still ensures the preservation of the value of pensions, social insurance allowances and monthly allowances in the face of inflation factors because the adjustment according to the percentage is still implemented.
