Prime Minister Nguyen Tan Dung has acknowledged the government’s role and his responsibility in Vinashin’s grave fiscal woes.

“As head of the government, I would like to take responsibility for the government’s limits and weaknesses,” he said during a National Assembly session broadcast live on Wednesday (November 24).

“The government and the Prime Minister are aware of their responsibilities in fulfilling their tasks as instructed by the Politburo and carrying out a successful plan to restructure Vinashin and avoid similar problems in the future,” he said

The session was considered by many as remarkable because it allowed national legislators a rare opportunity to question cabinet members about a wide-range of activities. The case of the ailing giant shipbuilder was one of the most hotly debated topics of discussion.

The state-owned shipbuilder, Vietnam Shipbuilding Industry Group (Vinashin), accumulated debts of at least VND86 trillion (US$4.3 billion)—up to 11 times its capital holdings.

On Tuesday, the Transport Minister described the firm’s financial status as having fallen to “an unsafe level with possible bankruptcy [on the horizon].”

Dung admitted that wrongdoings of Vinashin leadership caused “serious harm.”

“The people who directly managed the group’s business and violated laws are facing investigation and will be strictly punished,” he said.

The government and its members are responsible in terms of their failure to manage the firm, Dung said. He acknowledged that they had failed to conduct timely inspections or follow them up with due diligence.

When Deputy Pham Thi Loan of Hanoi asked about Vinashin’s ability to pay its debt, Dung replied that an appointed commission on Vinashin’s restructuring would provide specifics.

“Here, I am unable to list in details what the planned profits of each ship are and how much of its debt will be paid per year,” he said.

Deputy Vu Hoang Ha of the south-central province of Binh Dinh questioned Prime Minister Dung about how involved cabinet members were in the case.

“The Prime Minister said that government members are reviewing, but I am afraid that it is not a serious review,” Hoang said. “While the Prime Minister has taken responsibility, other cabinet members answering lawmakers have not owned up to their wrongdoings and said they are not involved. May I ask for the Prime Minister’s attitude towards these government members?”

In response, Prime Minister Dung reaffirmed his responsibilities in the case and indicated that an inspection is underway.

“We are reviewing and clarifying, which minister was involved and to what extent,” Dung said. “This matter will be truly concluded.”

Earlier on Tuesday, Transport Minister Ho Nghia Dung said government auditors are calculating Vinashin’s debts. The debts, he said, cannot be considered losses.

“These debts have been invested in Vinashin’s current assets, including 28 shipbuilding factories, 14 others under construction and dozens of shipbuilding contracts,” he said.

“Vinashin will pay its debts with its own profits. The government is not shouldering its debts,” he said.

Last week, Prime Minister Dung approved a plan to restructure Vinashin so that it will retain focus on its core businesses.

The 2011-2013 plan aims to maintain stable development so that the company can repay its debts and generate profits by focusing on its core business.

The government has also ordered the group to make full use of its assets and divest from non-core business activities.

During the Wednesday session, deputy Nguyen Minh Thuyet of the northern mountainous province of Lang Son raised questions about the appointment of Pham Thanh Binh to two executive posts within the company.

Binh serves as both chairman and general director of the group, which is illegal under the State Enterprise Law.

Prime Minister Dung said that Binh was appointed general director of the group – then Shipbuilding Industry General Company – in 1996 by then Prime Minister Vo Van Kiet. He was later appointed chairman when the company became Vinashin in 1999.

Dung said a plan to appoint a new general director, after Binh became chairman, failed. “We will review and clarify this situation,” he added.

Founded in 1996, Vinashin aimed to become one of the world’s top shipbuilders. But as the group expanded and diversified into running businesses ranging from animal feed production to tourist resorts, it incurred massive debts that the government has estimated at VND86 trillion (US$4.3 billion), around 4.5 percent of the country’s gross domestic product in 2009.

Since August, seven Vinashin execs including its chairman Pham Thanh Binh have been arrested in the ongoing probe into the group’s mismanagement. Deputy PM Nguyen Sinh Hung has been deputed to head a government commission to help with Vinashin’s restructuring.