Concerns about 2 pension increase options
The Ministry of Home Affairs is seeking opinions to finalize the Draft Decree adjusting pensions, social insurance (SI) allowances and monthly allowances.
Accordingly, the Ministry of Home Affairs proposed 2 options for adjusting pensions and allowances.
Option 1, from July 1, 2026, adjust to increase by 4.5% and 200,000 VND/month on the pension, social insurance allowance and monthly allowance level of June 2026;
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 for the above subjects.
According to labor experts, the Ministry of Home Affairs' proposal for 2 pension increase options from July 1, 2026 is not simply an income addition. Behind it is a policy choice of principle: prioritizing fairness according to contribution - benefit or strengthening sharing to support vulnerable groups.
In the first option, the 4.5% increase accompanied by an additional 200,000 VND/month creates a clear "bottom-up" mechanism. People with low pensions - who have suffered many disadvantages in the past due to limited contributions - will have significantly improved income correlation.
This is a highly secure approach, aimed at narrowing the gap and reducing living pressure for the most vulnerable groups. In the context of increasing living costs, this choice clearly reflects the message: policy does not leave anyone behind.
However, this option also raises questions about fairness according to the principle of social insurance. When people with high contributions in the past receive a relatively lower increase rate, the feeling of "paying a lot - enjoying commensurately" may be affected.
Conversely, the option of increasing by about 8% on the entire current pension level leans towards uniformity and consistency with the principle of contribution - benefit.
People who contribute a lot and enjoy high benefits will continue to be increased correspondingly; the system therefore maintains "discipline" and transparency. This is also a familiar approach in previous adjustments, helping to make it easier to forecast and convenient in management.
Along with that, the limitation of this option is that the income gap between retirement groups may continue to widen. People who are receiving low salaries, even if they are increased, still find it difficult to significantly improve their lives.
Meanwhile, the group with high salaries increases absolute advantages. Without additional support mechanisms, social security goals may not be achieved as expected.
There is a situation where some people have very high pensions.
According to Prof. Dr. Giang Thanh Long, senior lecturer at the National Economics University, if a calculation formula exists for many years and changes, it is difficult to avoid the psychology of beneficiaries being concerned.
Therefore, pensioners need to be clearly explained about policies. In particular, according to experts, adjusting towards prioritizing low-entitlement groups is not only for welfare but also to "correct the misalignments" left by the past.
The current pension level is greatly influenced by the calculation formula in the past. Previously, there was a period when pensions were calculated based on the last 5 or 10 years, leading to a situation where some people had very high pensions due to a sudden increase in salaries at the end of their careers.
Conversely, those who retired before 1995 or worked in the low-wage period suffered losses. Therefore, participating in the system together, but the benefit levels between groups may differ greatly due to historical factors, and adjustment and compensation are necessary.
Reality shows that there is no absolute perfect option. The core issue lies in determining priorities in each stage. When the economy is still volatile and spending pressure on retirees increases, the "sharing" factor needs to be seriously considered. But at the same time, the principle of contribution - benefit cannot be underestimated because it is the solid foundation of the social insurance system.
