Cooling the “Blazing Furnace” of Vietnam’s Anti-Corruption Drive

Vietnam’s public sector is in deep trouble. Since 2016, a mass exodus of public employees has coincided with growing fears among those remaining of being caught in anti-corruption investigations, leading to widespread reluctance to fulfil their responsibilities. This has exacerbated the challenges faced by an already overstretched bureaucracy, manifesting in overcrowded public hospitals, severe shortages of teachers and doctors, project approval delays, and extensive queues for vehicle registrations. Most critically, it has resulted in diminished government efficiency at a time when Vietnam needs it most.

The root of this crisis is partly the swift and vigorous anti-corruption campaign, admitted by many Communist Party of Vietnam (CPV) theorists (it is rare for party theorists to make such admissions). As of early 2024, nearly 200,000 cadres have faced disciplinary action, with many criminally charged, over just a decade. This campaign, dubbed “Blazing Furnace,” has instilled a pervasive fear within the bureaucracy, leading to 60,000 resignations between 2021 and 2023 — a significant figure given the total public sector employment of 2.5 million.

In response, the one-party state has issued several policies to stem this tide, including the Politburo’s Conclusion No. 14 in 2021 to “encourage and protect innovative cadres for the common good” and the government’s Decree 73 in late 2023 aimed at protecting officials who “dare to think and dare to work”. CPV General Secretary Nguyen Phu Trong has publicly warned about the “extreme tendency” to deter corrupt behaviour and called for a concrete mechanism to protect and motivate dedicated cadres.

However, these measures have yet to reverse the trend. Addressing this crisis requires an acknowledgement of the anti-corruption campaign’s unintended consequences on an already fragile public sector burdened by structural issues such as ineffective evaluation systems, inadequate remuneration, lack of transparency, and uninspiring work environments. Revitalising Vietnam’s public sector needs immediate remedies and a well-coordinated plan to accelerate long-delayed administrative reforms.

First, establishing clear boundaries for anti-corruption investigations in terms of scope and responsibilities is crucial. Although Conclusion 14 and Decree 73 assure that “innocent mistakes” might not lead to punishment, it remains challenging for individuals to prove such innocence without detailed guidelines. This issue becomes particularly pressing as “irresponsibility causing serious consequences” is a criminal offence under Vietnamese law and is frequently cited in corruption cases. In that regard, considering Vietnam’s entrenched corruption, introducing a one-time amnesty for less egregious errors or a cut-off date for retroactive investigations could provide needed certainty for concerned officials and encourage their cooperation in strengthening the anti-corruption framework. For instance, the case of former president Vo Van Thuong, recently disgraced for actions taken over a decade ago as party secretary of Quang Ngai province, illustrates the complexities of retroactively applying punitive measures without cut-off dates.

In the long term, the priority should be to offer fair compensation to public sector workers. Salaries for Vietnamese public employees are significantly lower than those of their counterparts in Southeast Asia: a mid-level official earns roughly VND10 million (about US$400) per month, a stark contrast to peers in Thailand (US$2,260), Malaysia (US$1,170), and Cambodia (US$686). This discrepancy becomes more pronounced when considering that the baseline monthly salary is approximately US$80, with the prime minister’s position’s salary ceiling barely exceeding US$1,000 — in a country where the annual GDP per capita is over US$4,000. In comparison, the annual GDP per capita in Cambodia, Thailand, and Malaysia is US$1,759, US$6,910, and US$11,993 respectively.  

Addressing corruption is vital but it must be carefully balanced with the need to cultivate a sustainable and efficient bureaucracy.

In this context, it is understandable why many cadres rely on unofficial sources of income such as so-called “facilitation fees” for faster administrative processing, to supplement their meagre earnings. This reliance partly explains the previously high demand for government roles despite low official pay and the exodus of officials as the “Blazing Furnace” turned up the heat on major and petty corruption.

The government has acknowledged the issue of inadequate public sector salaries and is taking steps to address it. Starting from July 2024, public officials will see a notable salary increase of up to 30 per cent, with a further 7 per cent annual increment thereafter. Notwithstanding this, the new salary structure may still fall short of making public employment attractive. For instance, even with the adjustment, General Secretary Nguyen Phu Trong’s salary will increase by an additional VND3 million (approximately US$120) per month. This is not enough to bridge the gap between Vietnamese public sector pay and that of its neighbours or to compensate for the loss of unofficial income streams.

In addition, the government needs to improve the working environment through better management and increased transparency. The Vietnamese public sector remains extremely hierarchical and vulnerable to favouritism, where one’s performance is often evaluated not by concrete criteria but by written (but subjective) evaluations from direct supervisors and colleagues. This context hardly motivates cadres to be “daring and innovative” as proposed in Degree 73. Furthermore, it exacerbates the “brain drain” problem, particularly among young and capable officials who might be inexperienced in office politics.

Addressing corruption is vital but it must be carefully balanced with the need to cultivate a sustainable and efficient bureaucracy. This is crucial for Vietnam to navigate existing domestic and external challenges and to reach its ambitious goal of becoming a developed nation-state by 2045.

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