Vietnam Social Insurance Reform: World Bank, Informal Workers, 2030 Goal, Digitalization
2nd March 2025, Kathmandu
Vietnam has seen significant economic growth, but a large part of its workforce is still in the informal sector. Workers in this sector, without formal labor contracts, are excluded from mandatory social insurance (SI) coverage.
Vietnam Social Insurance Reform
Although the government has successfully expanded health insurance to informal workers, pensions and other short-term benefits have not been equally addressed. This gap in coverage presents a challenge for broader social security inclusion.
Ambitious Social Insurance Goal
Vietnam has set an ambitious target under Resolution 28 to achieve 60 percent contributor coverage of the labor force and 60 percent beneficiary coverage for older adults by 2030. The voluntary social insurance scheme (VSIF), introduced in 2008, allows workers who aren’t eligible for compulsory insurance to join. Expanding this scheme remains a challenge that requires innovative strategies.
World Bank’s Role in Expanding Coverage
To help meet these goals, the World Bank has partnered with Vietnam Social Security (VSS). The collaboration follows a recent amendment to Vietnam’s social insurance law in 2024, aimed at bringing informal sector workers into the insurance system. The World Bank’s support will focus on increasing fiscal incentives, improving program design, and strengthening service delivery.
Learning from Global Successes
The World Bank also plans to draw from global experiences. One example is Egypt’s success in digitalizing its social insurance system and reaching informal sector workers. The World Bank has suggested that VSS officials visit Egypt to learn from their approach. The hope is that these lessons can be applied to Vietnam’s context to help expand social insurance coverage.
Focus on Training and Technical Assistance
The World Bank’s support goes beyond financial aid. It includes providing technical assistance to the VSS and training insurance company employees to better serve the informal workforce. By equipping staff with the right skills, the World Bank aims to improve the effectiveness of the social insurance system.
Current Coverage and Future Plans
Currently, approximately 34 percent of informal sector workers are covered by Vietnam’s social insurance program. With the World Bank’s guidance and support, the country plans to expand this coverage in the coming years. The goal is to ensure that a broader segment of the population benefits from pensions and social insurance.
Towards a More Inclusive Future
The World Bank’s partnership with VSS is essential in helping Vietnam expand its social insurance program. The ongoing revision of the 2024 social insurance law and improvements in program delivery and incentives will support the goal of reaching 60 percent coverage by 2030. As Vietnam continues its efforts, the collaboration with the World Bank is set to play a crucial role in achieving this goal and bringing more informal sector workers into the fold of social insurance.
For more: Vietnam Social Insurance Reform
