Please explain why Việt Nam wants to increase the retirement age of its employees?

As we all know, the average Vietnamese lives to 73.4 years - 70.8 for men and 76.1 for women. However, the average retirement age for both men and women is only 54.2 years old, 55.6 for men and 52.6 for women. Generally speaking, the years of participating in social-insurance for men is 28 years and 23 years for women while their years of enjoying the retirement pension is 18.1 years for men and 24.5 years for women.

Furthermore, the number of people participating in the social insurance fund has been declining while the number of people that will enjoy it has been increasing. In 1996, 217 people participated in the social-insurance fund to benefit only one pensioner. The ratio now is eight people to one social beneficiary. That’s why, there is a danger of imbalance in the national retirement fund - and so is the one off payment to the family of a member who dies.

The golden age of our population has gone. In 2011, we started to enter a period of ageing. That means, pretty soon, human forces will be in shorter supply. That’s why, we must increase the retirement age of working people. Many other countries have already increased the retirement age to 65 or even 67.

The need to increase the retirement age is obvious, why can’t we apply that?

When we conducted studies on the revision and supplement to the 2012 Labour Code, we came up with two scenarios.

The first scenario was to increase the retirement age for both men and women to 60, but women could make their own decision to retire in any year between 55-60. The second scenario was to increase the retirement age to 60 for women and 62 for men. But both scenarios were rejected by the National Assembly.

At present, the lives of Vietnamese people are increasing, that’s why we need to conduct studies about raising the retirement age for all working people. Of course, we also need a road map for each group of working people.

Do you have any comments on the two retirement scenarios?

The Ministry of Labour, War Invalids and Social Affairs has come up with two scenarios.

The new retirement age will start from January 1, 2021. For women it will be 60 and for men, 62.

In my opinion, the increases are to ensure the gender equality for both sexes, but we should develop a road map for the long term and learn from other countries.

Many people are worried that a rise in retirement ages in the context of the 4.0 industrial revolution will make many people unemployed. 

In Việt Nam, at present, some 1.1 million people in the working age are unemployed.  Among them, young people are dominant. It is undeniable that in the 4.0 revolution,  popular workers or low skilled workers will be on the verge of losing their jobs.

On the other hand, we have also received comments saying that the decision to increase the retirement age will only benefit white-collar workers. As in society, the percentage of these people occupies only a small portion.

In my own opinion, the adjustment in the retirement age is only one of several measures ensuring the principle of contribution and enjoyment in social insurance and making the best use of the high quality labour force to maintain the retirement fund and death benefits. Of course, it is not just for the interest of a special group.

Will you elaborate on yours ideas?

Now is time for us to honour the principle that the more you pay, the more you will have. That’s why the pension money of many people is high while that of other people is only small.

At present, the number of people participating in the social insurance scheme is about 14 million people, about 30 per cent of the labour force. The low percentage of people participating in the social insurance scheme has made our social insurance net weak and unable to protect the majority of the working people, particularly when they are getting old. This is a key reason the Government wants to increase the retirement age and to reform the social insurance policy.

Participating in the social insurance scheme is the right and responsibility of all working people. — VNS

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