Decentralization: Finance Minister presents new tasks for municipalities!

Decentralization: Finance Minister presents new tasks for municipalities!

The national training conference on the organization and functioning of party organizations, the government, the Fatherland Front and community-level political organizations was held on June 14 and 15, 2025. During this conference, Treasury officials reported on the current status of decentralization, delegation of authority and definition of responsibilities in the financial sector. It was emphasized that effective decentralization does not only involve the distribution of tasks, but also requires a profound change in the structure of the state.

A total of 253 legal documents were reviewed, including 17 laws, 65 regulations and 143 circulars, to promote decentralization and delegation of power. 412 tasks for decentralization were proposed, 58 of which have already been implemented. The process involves the distribution of 354 tasks at different administrative levels: 13 tasks are subject to the National Assembly or the Standing Committee, while 92 tasks are delegated by the government to ministers and municipalities.

Implementation of decentralization

A key aspect of the conference was the transfer of competencies to the district level, with 187 tasks to be transferred to the municipal level and 20 tasks to be transferred from the district level to the provincial level. This also includes the revision of 13 laws and the development of five regulations and seven circulars by the Ministry of Finance. These policies focus on the state budget, public assets, taxes, public investments and local financial management.

The Ministry of Finance's efforts are aimed at ensuring a clear distribution of responsibilities between the central government and local authorities. In this context, proposals were presented to transfer five tasks in the field of public investment from the district level to the provincial level. In addition, 101 tasks will be assigned to land financing, confiscation and management of public assets.

Role of international cooperation

Decentralization not only leads to a new distribution of roles and tasks between levels of government and administration, but also changes the relationship between citizens and the state. Germany has an internationally recognized pioneering role in promoting such decentralization processes. The experiences from bilateral development cooperation are of great importance here. As in the report from the BMZ As shown, reforms must be tailored sensitively and individually to the specific circumstances of each country.

A close exchange takes place at all levels involved within the framework of German development cooperation. This ensures that local self-governments are adequately equipped, both financially and in terms of personnel, in order to successfully master the challenges of decentralization.

The Ministry of Finance has approved the delegation of five planning and tendering tasks from the National Assembly and the Prime Minister to the local level. In addition to the general decentralization proposals, the National Assembly also recently approved further decentralization for the city of Haiphong.

By June 30, 2025, municipalities must review and complete the content of decentralization and the arrangement of public assets. These measures are crucial to increase efficiency in the management of public assets and to ensure the appropriate arrangement of administrative units.