The road agencies believe, in accordance with numerous studies, that there is a significant latent rehabilitation burden hidden under Vietnam's road surfaces. Most Ministry of Planning and Investment resources designated for the road sector are counterpart funding to donor-supported rehabilitation and are thus not available for periodic maintenance. Although maintenance should be awarded higher priority than capital works, the network's poor condition and the fact that domestic resources can more easily be leveraged by donor funds for rehabilitation than for periodic maintenance lead to the underfunding of periodic maintenance. 3.9 Provincial and district networks are financed mainly through fiscal transfers from the Government of Vietnam. Some provinces use part of these funds to maintain the national network because the allocations from VRA are often insufficient.
Districts receive their central government budget allocation for roads through the provinces.
Reliable data on maintenance expenditures at the district, village, and subdivision levels are not available. Expenditures on medium-size and large repairs, however, considerably exceed budget allocations . Most of the overrun occurs because planned work costs more than is anticipated. While this system provides flexibility, it has some problems. For example, if budget allocations stagnate or decline, or if maintenance companies demand prompt payment, the system will fail.