An increase of 15.28 percent in the average price of electricity takes effect on March 1. Along with the sharp increase in the cost of material inputs for the national economy, the new electricity price will cause the Consumer Price Index (CPI) to increase in the coming time.

To curb inflation and stabilize the macro-economy, the government has issued a resolution and a group of drastic measures to tighten monetary policies, reduce public spending and promote exports and production. At the same time, the government will continue to implement a strategy to adjust the price of petrol, oil and electricity according to the market price. This proves that the government is aware of the importance of social welfare solutions in addition to managing the national economy in the fight against inflation.

As of March 1, 2011, every poor household is provided with VND30,000 to pay for the increase cost of electricity and cope with escalating prices in the local market.

According to statistics from the Ministry of Labour, Invalids and Social Affairs, the State budget will spend around VND1,120 billion to help 3.2 poor households pay for electricity. Low-income households using below 50kwh per month will pay only 80 percent of the average electricity price. The electricity sector will help workers and students by issuing pre-paid cards similar to telephone cards to prevent guest house owners illegally increasing the price of electricity.

In fact, the new electricity price plan for poor people has already been implemented for a long time as part of the State’s overall social welfare programmes. The problem now is how to implement the plan effectively by promoting dynamism and creativity as well as active involvement of local authorities at all levels. Relevant agencies should take drastic measures to direct local authorities to cut red tape and facilitate the plan to help poor people as quickly and effectively as possible.

The recent corruption in poverty reduction programmes 134 and 135 has made people lose confidence in the State’s social welfare policies.

Therefore, ways to support poor people must be diversified. Some economists suggest that the State or localities should issue coupons to poor people so they can actually buy goods instead of implementing programmes to stabilize prices which do not benefit them. In addition to the State’s policies, each locality should launch proper social welfare programmes and call on the joint efforts of the community to promote the tradition of assisting people who have been hardest hit by the inflation situation.

Early this year, businesses in the High Quality Vietnamese Goods Club have cooperated to introduce their products to rural areas and offer essential goods to poor people.