Vietnam Railways pleads for government funding as staff remain unpaid

Vietnam Railways owes its 11,300 workers four months’ salaries due to a funding delay by the government, and fears this could cause many to quit.

It reminded the government that it was supposed to receive VND2.8 trillion ($121.3 million) at the beginning of this year, but has not, forcing it to pay minimum compensation to staff.

Vu Anh Minh, its chairman, said the delay could cause barrier operators at grade crossings and patrol staff to quit since they have the lowest incomes.

“The issue has pushed the company to the end of its road. We might not survive until the end of this month.”

This is not the first time VNR has been forced to beseech the government for funding. Last year too it owed its staff salary for months but managed to survive that crisis.

The problem can be tracked to a dispute between two government agencies. Last year VNR became one of 19 state-owned companies whose oversight passed to the Commission for the Management of State Capital at Enterprises (CMSC), an entity that manages the government’s $43 billion investment in various companies.

The CMSC refused to provide funds, saying maintenance workers should be paid by the Ministry of Transport since it controls the maintenance and infrastructure budget.

But the ministry cannot provide funds to any entity it does not manage.

A temporary solution was agreed upon last year and the transport ministry provided the needed sum of VND2.5 trillion.

But there has been no decision yet on whether the same thing will happen this year, leaving VNR and its staff in the lurch.

VNR wants the government to provide the money through the CMSC.