Five State Institutions in Laos to Trial Self-Sufficiency Policy

Mittaphab Hospital treats covid-19 patients

The Government of Laos has agreed to trial a financial self-sufficiency policy among state organizations and institutions.

According to a report by KPL, the government will trial a scheme that will see Mittaphab Hospital, Mahosot Hospital, Setthathirath Hospital, the National University of Laos, and the Pakpasak Technical College become financially self-sufficient.

The scheme was authorized by Prime Minister Phankham Viphavanh at the monthly cabinet meeting in August.

The three-year experiment will see the hospitals and colleges managing their own financial affairs, with greater independence in how revenue and expenditures are administered.

The Lao government will continue to manage services at the new Mittaphab Hospital building, however, which was built with a loan from abroad.

The Ministry of Finance is to collaborate with relevant sectors on encouraging and monitoring the execution of the ambitious self-sufficiency policy to ensure productivity and sustainability, with the aim of seeing the five entities become role models for other state organizations.

At the monthly meeting, the government suggested that relevant sectors strengthen necessary regulations to preserve and enhance budgetary self-reliance in other state sectors in the central and municipal levels across the country.

The move comes after the announcement of another ambitious plan to reform the country’s floundering state enterprises.

National Assembly members noted during talks that while in China and Vietnam, state enterprises have become the engines driving success for their countries, in Laos they make only losses.

The new plan will empower executive board members to select the heads of some state enterprises in place of government ministers.

The board will then have the right to remove a director who performs poorly under the new policy.