Dang Thuan Phong, the committee’s vice chairman, said the proposed law offers two choices to individuals who want to receive lump-sum insurance benefits but have not yet achieved retirement age or paid social insurance premiums for a full 20 years.

Vice chairman of the NA Social Affairs Committee Dang Thuan Phong speaks at the meeting. Photo quochoi

Two options presented in the draft amended law are:

Option One: A lump sum withdrawal is only available to people who enrolled in the system before the law's implementation date, which is scheduled for July 1, 2025. Those who enroll after this point are not eligible for this option, except for individuals who reach retirement age but do not have the required years of contributions, those who emigrate, or those facing life-threatening illnesses.

Option Two: There is no distinction based on the number of years contributed. All workers with less than 20 years of contributions can make a withdrawal after one year of non-participation, capped at 50 per cent of their total contributions to the Retirement Fund. The remaining years’ contributions would be preserved for future benefits. This option does not limit the number of times a worker can make withdrawals.

The majority of deputies supported the first option, stating that it guarantees the continuation of present laws and has minimal impact on the approximately 18 million people who are currently participating in social insurance.

Additionally, it reduces the number of times a single person can file multiple claims for lump-sum insurance and approaches international social insurance standards and practices. According to statistics, over 25 per cent of those who have previously benefited from one-time social insurance withdrew their allowance for a second or more time between 2016 and 2022.

In the long term, the first option will lessen the strain on society and the budget while also helping more people to benefit from social insurance. Option 1's drawback lies in the way it compares participating workers before and after the amended social insurance law goes into force.

In the draft law, which addresses how to handle late payment and evasion of compulsory social insurance, it is requested that companies who violate the law cease using invoices.

Businesses will have to cease all operations and forfeit their chance to make money if the sanction is implemented, which will have a noticeable and direct impact on their commercial operations. Workers will generally be impacted as well because their jobs and revenue sources will be taken away.

Additionally, there is no solution to assist businesses in overcoming late payments and social insurance payment delay while they still have to fulfill their tax payment commitments.

Minister of Labour, Invalids and Social Affairs Dao Ngoc Dung talks about the conditions for receiving one-time social insurance

The draft law also stipulates temporary suspension of exit on those who are subject to implementation of decision on administrative sanctions.

Minister of Labour, Invalids and Social Affairs Dao Ngoc Dung said the regulations related to conditions for enjoying lump-sum social insurance benefits aim to retain employees, minimise the one-time withdrawal while still fully protecting the rights and interests of employees.

He said the difference between the draft and current laws is that if an employee who chooses not to receive one-time social insurance, when s/he reaches retirement age, is not eligible to receive pension and not old enough to receive social pension benefits, and s/he can choose to enjoy additional benefits.

For example, s/he can receive monthly benefits since s/he reaches retirement age until s/he is old enough to get social pension benefits. During this period, the State budget will cover health insurance. If s/he dies, his/her relatives will receive funeral benefits.

The draft law stipulates that if employees do not receive monthly benefits, they will receive one-time social insurance but will lose the opportunity to receive the additional benefits mentioned above, he said.

Dung said a number of specialised seminars, in-depth research, and comprehensive impact assessments have been conducted to carefully study the draft law. Every choice has advantages and drawbacks. Many prefer the first option which is believed to have more advantages and are more suitable for the current situation.

 An overview of the meeting

At the meeting, deputies also gave feedback on delayed and evaded payment of compulsory social insurance and measures to handle those cases.

They also discussed special mechanisms to protect employees in the event that their employer is unable to continue paying social insurance.

Wrapping up the discussion, chairman of the NA Social Affairs Committee Nguyen Thuy Anh highly appreciated opinions made by deputies as well as representatives of relevant agencies to ensure high quality of the draft law.

These viewpoints will serve as the foundation for future revisions, additions, and completion of the draft law before it is sent to the NA Standing Committee and NA for additional review, she said./.