Two options proposed to increase pensions from July 1st
Currently, there are about 3.5 million people nationwide receiving pensions and monthly social insurance allowances. In the context of market prices tending to "increase before salary" as they are now, the plan to adjust pensions is receiving much attention from the people.
Currently, the Ministry of Home Affairs is drafting a decree adjusting pensions, social insurance allowances and monthly allowances, at the same time increasing the base salary from 2.34 million VND to 2.53 million VND/month.
Option 1:
Increase by 4.5% and add 200,000 VND/month for many groups receiving pensions and allowances. Three groups, including people receiving work accident and occupational disease allowances; people receiving monthly death benefits before January 1, 1995; and people who do not yet meet the conditions to receive pensions, are proposed to increase by 8%.
People retiring before January 1, 1995 will be adjusted to 3.8 million VND/month. People currently receiving less than 3.5 million VND will receive an additional 300,000 VND/month.
Option 2:
A simultaneous increase of 8% for all groups currently receiving benefits. The group retiring before 1995 was also adjusted to 3.8 million VND/month.
Why is the pension increasing and the benefit gap widening?
According to Vietnam Social Security, from 1995 to now, the State has implemented 24 adjustments to pensions and social allowances to ensure the lives of people of working age.
In the 2016-2024 period alone, the Government has adjusted 6 times with increases respectively: 8% (2016); 7.44% (2017); 6.92% (2018); 7.19% (2019); 7.4% (2022) and 15% (2024). Among them, 2024 had the highest increase.
This adjustment contributes to improving the lives of pension and social insurance benefits recipients.
Currently, the average pension level of people receiving from the social insurance fund is about 7 million VND/month, including the armed forces.
However, pensions are calculated according to the "pay - receive" principle, based on salary and social insurance participation time. Therefore, the benefit level between individuals is largely different. Some people receive hundreds of millions of VND per month, but some people only receive very low levels, especially the group who retired before 1995.
According to the Ministry of Home Affairs, the current general pension adjustment method still has some shortcomings. The steady increase in percentages continues to widen the gap. For example, people with high salaries will receive more money, while those with low pensions will increase insignificantly.
From this reality, the Ministry of Home Affairs is seeking opinions from relevant agencies to propose a plan to adjust pensions in a more appropriate direction this year.
Notably, the Ministry proposed to supplement the group of subjects regulated in the Law on Social Insurance, including employees who do not meet the conditions to receive pensions, are not old enough to receive social pension benefits and do not withdraw social insurance once. Currently, this group is receiving benefits according to the number of years of social insurance contributions, with the lowest level of about 500,000 VND/month.
If approved by the Government, this will be considered a humane policy to help people who have reached retirement age have more income, and at the same time keep workers in the social insurance system.
The 2024 Law on Social Insurance, effective from July 1, 2025, stipulates that pensions will be adjusted based on the consumer price index and the capacity of the budget and social insurance fund. At the same time, the law requires reasonable increases for low-wage earners, especially those retiring before 1995, in order to narrow the gap between groups.
