The Ministry of Home Affairs is currently seeking public feedback on a draft Circular that outlines the timing and conditions for receiving pensions under the 2024 Law on Social Insurance, set to take effect on July 1, 2025. This legislation marks a significant shift in pension eligibility, particularly for those participating in voluntary social insurance.
According to Clause 4, Article 101 of the 2024 Law on Social Insurance, the timing for enjoying pensions will be clearly defined by the Minister of Labor, Invalids and Social Affairs. The draft Circular specifies that individuals who have contributed to voluntary social insurance for 15 years or more will be eligible to receive their pensions starting from the first day of the month following their retirement age, as stipulated in the Labor Code.
For instance, Mr. A, born on April 5, 1964, has been a participant in voluntary social insurance for 19 years. By July 2025, he will be 61 years and 3 months old, which qualifies him for retirement. Therefore, his pension will commence from August 1, 2025.
If an individual continues to contribute to voluntary social insurance after meeting the retirement age, their pension will take effect from the first day of the month following the month they cease contributions and apply for their pension. Additionally, those who opt to make a lump-sum payment for any remaining years of contributions will have their pensions calculated from the first day of the month following the completion of that payment.
The new regulations also address those who participated in voluntary social insurance prior to January 1, 2021. For these individuals, if they have 20 years or more of contributions, their pensions will be calculated from the first day of the month following the month they turn 60 for men and 55 for women. For example, Ms. D, born on August 16, 1970, will turn 55 in August 2025 and has 20 years and 3 months of contributions. Thus, her pension will be effective from September 1, 2025.
Moreover, if the date for pension eligibility is determined before July 1, 2025, the pension will be effective from that date. For those whose exact birth dates are unknown (only the year is available), the pension will be calculated from the first day of the month following the month they meet the conditions for retirement.
The conditions for receiving pensions for voluntary social insurance participants are governed by Article 98 of the Law on Social Insurance. The draft Circular outlines two options for considering the contribution period for those who have made payments in installments—whether quarterly, semi-annually, annually, or as a lump sum for multiple years.
Option 1 states that the last month of the contribution method that the participant has paid will be considered (even if the individual has already met both the age and contribution time requirements). For example, Mr. T.V.H, born on September 2, 1965, is participating in voluntary social insurance. In August 2025, he registers to make a lump-sum payment for three years, covering the period from August 2025 to July 2028. By June 2027, he will have reached the retirement age and can request his pension. In this case, his contribution period will be calculated until July 2028.
Option 2 allows for the month in which the voluntary social insurance participant meets the age conditions and requests a pension to be considered. This option presents two scenarios: either recording the contribution time until the requested time and refunding any months paid thereafter, or recording the contribution time until the end of the contribution method. Using Mr. T.V.H's example, his contribution period would still be calculated until July 2028.
The new draft Circular is poised to create greater opportunities for individuals who may have previously withdrawn their social insurance in a lump sum, allowing them to still accumulate the necessary 15 years of contributions. This change is particularly beneficial for those who may have joined social insurance later in life or participated inconsistently, enabling them to qualify for monthly pensions.
The proposed regulations are expected to significantly impact the workforce, particularly those nearing retirement age. By reducing the required contribution period from 20 years to 15 years, the Ministry aims to provide a more accessible pathway to retirement for many individuals.
Overall, the draft Circular reflects a progressive approach to social insurance in Vietnam, addressing the needs of a diverse workforce and adapting to the challenges of modern employment patterns. As the Ministry of Home Affairs continues to gather public input, the final regulations will likely play a crucial role in shaping the future of pension accessibility for millions of Vietnamese workers.
