HANOI, July 19 (Reuters) - Newly elected members of Vietnam's National Assembly started a session on Thursday to form a smaller, more efficient government aimed at strengthening the economy and fighting corruption.

The 493-member National Assembly, formed after a general election in May, will vote for top government positions next week. From July 30 it will cut the number of ministries to 22 from 26 now and vote for new ministers on August 2.

Prime Minister Nguyen Tan Dung, President Nguyen Minh Triet and Assembly Chairman Nguyen Phu Trong, who were appointed by the ruling Communist Party at its five-yearly congress in April 2006, are expected to stay in power.

The economy is expanding rapidly, with growth of more than 8 percent in 2005 and 2006. But with greater prosperity has come higher land and food prices and widespread corruption, officials said.

Hundreds of farmers from central and southern provinces gathered recently near Hanoi's Ba Dinh hall, where the assembly session is being held, to complain over land disputes and corruption among local officials.

A similar peaceful protest occurred in Ho Chi Minh City in past weeks as well.

The government has acknowledged the problems and pledged more action in the remaining months of 2007.

"We are speeding the implementation of industrialising and modernising the country, the international economic integration, raising the position and power to ensure the cause of building and protecting the nation," party chief Nong Duc Manh told assembly delegates.

He was speaking after the party's powerful Central Committee met to work out cabinet members and the government structure likely to be approved in the assembly session ending on August 6.

The National Assembly has said it would also vote to shorten its five-year office to four to match the next Communist Party congress due in 2011.

The previous assembly was mainly focused on building up the economy but failed to address social issues and environmental protection, former assembly deputy chairman Mai Thuc Lan said in an article published on Thursday.

"The gap between rich and poor in many areas and among people is widening, workers are exploited, farmers losing fields or who cannot rely on agricultural production have left to look for jobs in urban areas," he wrote.

Deputy Prime Minister Nguyen Sinh Hung said the government would focus on measures "to maintain fast, sustainable economic growth closely attached to dealing well with social issues and hunger eradication and poverty reduction" by the year end.

The government would also speed administrative reform and fight corruption in the coming months, Hung said in a government report to the assembly, a copy of which was seen by Reuters.

Vietnam should aim for 9 percent economic growth in the second half to reach the annual target of 8.5 percent, he said.

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