H.E. Deputy Prime Minister Keat Chhon, Minister of Economy and Finance and First Vice Chairman of the Council for the Development of Cambodia, in his capacity as Chairman of the Government-Development Partner Coordination Committee (GDCC), opened and welcomed all participants the sixteenth meeting of the GDCC. In his opening remarks, he emphasized that the meeting was to discuss some important issues that had happened since the 15th GDCC, and to provide opportunity to discuss on the 3rd Cambodia Development Cooperation Forum (3rd CDCF) preparation, which would take place on June 2-3, 2010. In addition, H.E. Chair mentioned about an optimistic fresh scheme (Priority Operation Cost) for replacement of the terminated PMG/MBPI schemes. He also stated that this new POC scheme would focus on key principles including service delivery, harmonization, efficiency and sustainability, and foremost the “principle of Equity” which has been strongly stressed by Samdech Akka Moha Sena Padei Techo Hun Sen, Prime Minister of the Kingdom of Cambodia, and which has been a basic principle of the Royal Government’s Rectangular Strategy.
The agenda items of the meeting were:
i. Progress of the preparation of Priority Operating Cost (POC)
ii. The preparation of the 3rd CDCF
[All presentations are available on www.cdc-crdb.gov.kh]
Agenda item 1: Progress of the preparation of Priority Operating Cost (POC)
H.E Ngo Hong Ly, Secretary General of the Council for Administrative Reform (CAR), gave a brief presentation on Progress of Priority Operating Cost Preparation and Public Administrative work including compensation reforms. He further informed the meeting about the result of the high level meeting between RGC and development partners on Compensation Reform, held on 9 April 2010 , that the meeting was agreed on five main points as following:
1) POC was separated from future RGC compensation system, because it was just a transitory mechanism which provide inputs to achieve the result of projects/programs while compensation system was a long-term government system.
2) POC implementation focuses on three principles including harmonization, alignment and adjustment in order to mitigate risks related to equity.
3) Compensation system is focus on five bases as following: a) sustainable economic growth, b) effective civil service work, especially public service delivery, c) equity, d) unity in public administration and e) sustainability.
4) Compensation system and POC are two parallel tracks.
5) The mandate of technical teams was identified and empowered to elaborate a Joint Monitoring Indicator (JMI) on Compensation Reform for CDCF by taking actions immediately on POC grid and future guideline.
Comment s by Development Partners:
H.E. Frank Mann, Ambassador of Germany, representing DPs, expressed his statement regarding the effort made by RGC and with some concerns on Compensation Reform (Government Vision, specific decision on NPAR, the approach to creating fiscal space, sequence implementation of compensation reform and expected timeframe for early implementation) and POC (implementation parameters for POC, next steps for POC grid, and date for its revision, ending and Government to envision a review of POC). In addition, he also raised the question about the possibility to conduct a pilot compensation system in some line ministries/institutions.
H.E Mr. Fan Qimiao, World Bank Country manager, also stressed that development partners were aware of the complexity and challenge of the public administration reforms including compensation reform and its long-term issues. Besides, POC would be a tool to support the implementation of NSDP priorities; and it should replace all existing adhoc supplementary schemes including PMG/MBPI. Furthermore, RGC should make effort to improve quality of public administrative reform strategies and undertake the necessary studies such as fiscal space, labor market, and so forth. Therefore, suggestion by DPs was that RGC should elaborate principles and milestones ensuring that POC can be implemented from the 1st of July; in addition, RGC also needed to further address the detailed processes, approaches and vision, and elaboration of government agencies in completing compensation reform and developing principles and milestones for POC.
Response from RGC: Regarding the POC, H.E. Ngo Hong Ly noticed that there was consensus to develop POC grid in three categories. Firstly, category relating to national reform works; secondly, relating to sub-national reform works and civil service delivery works; and lastly, concerning with high skill work. Seven Government ministries/institutions such as MEF, MoEYS, MoH, MoP, CDC, MoI and COM contributed inputs to the preparation of this grid; and, moreover, it was shared with development partners and government agencies to simulate and ensure the less and stable cost comparing to MBPI/PMG. POC would be implemented on 1 July 2010, and future guideline would be established for POC implementation.
RGC welcomed development partners’ comments and further support relating to government approaches and vision for completing compensation reform. Furthermore, RGC would provide concrete details on these issues after a wider study on compensation reform. Appropriate balance between equity and effective work would be identified. RGC would discuss compensation reform issues at TWG-PAR mechanisms with development partners. Moreover, it would be very difficult to conduct a pilot compensation system in any line ministries because it may result in the conflict with the equity principles of the government public administration work.
Agenda item 2: The preparation of 3rd CDCF
H.E. Chhieng Yanara provided a presentation on the 3rd CDCF preparation following by four main issues related to the CDCF agenda, JMIs, 2010 AER Report, and MYIFF.
1. CDCF Agenda
The overarching theme of CDCF – Implementation of the Rectangular Strategy Phase II by using the NSDP Update – would ensure that the reforms and sectoral work, which have been operationalised through the NSDP together with support of development partners, are fully aligned with the objectives and implementation period of the Rectangular Strategy. Each CDCF session would emphasize concrete results that can guide the future sectoral work and GDCC dialogue. RGC and development partners agreed to work together by continuing discussion and agreement on concrete actions to ensure the effective result of the CDCF.
2. New JMIs proposed for the 3rd CDCF
The revised format of JMIs, which were discussed on February 16th and agreed by the government at the TWG Network workshop on April 7-9, 2010, would promote result-based approach and the linkage to the Rectangular Strategy phase II and NSDP outcomes. The meeting has agreed on final draft of new proposed JMI, except for PAR that need for further discussion.
3. 2010 Aid Effectiveness Report
The 2010 AER, which has been prepared by CRDB/CDC, revealed that the aid trends continue upwards to USD 990 million in 2009 and continue to rise to more than USD 1 billion in 2010. The report, which was supported mainly by the findings of Paris Declaration Evaluation phase II, also addressed the issues of program-based approaches that contribute to the discussion at the upcoming CDCF. Therefore, the draft of this report was shared to RGC agencies and development partners for comments and will be finalized after this sixteenth GDCC.
4. Multi-Year Indicative Financing Framework
The figure of MYIFF (2010, 2011 and 2012) provided by development partners showed the strong support for the programs and resource requirements indicated in the NSDP Update; and would promote the aid predictability. The number for 2010 was above USD 1 billion and was similar to the number derived from ODA Database for AER. Moreover, the final figure of MYIFF would be shared to development partners and RGC agencies after revision.
Comments by Development Partners:
H.E Mr. Fan Qimiao raised that development partners welcomed the efforts made by RGC, especially CRDB/CDC, in preparing documents and working closely with them for the 3rd CDCF preparation. They would continue to support RGC in order to achieve the productive and effective CDCF dialogue. He further mentioned that Cambodia economy, projected by IMF, was 4.8 percent increase in GDP in 2010 which is a favorable sign for the recovery after the crisis period.
Development partners acknowledged the RGC efforts in developing of National Forestry Program and long-term strategy for forestry which will strengthen sustainable forestry resources management. They would also welcome the participation and productive comments of civil society and private sector in the upcoming CDCF.
Mr. Douglas Broderick also acknowledged efforts made by RGC in producing CDCF documents, especially new JMIs and 2010 AER which were prepared by CRDB/CDC. He noticed development partner would work with RGC to ensure development effectiveness, involving strengthening partnerships around PBAs; reviewing JMI monitoring mechanisms to ensure accountability; strengthening linkages between planning, budgeting, and aid coordination; and promoting capacity development and reforms (Public Administrative Reform, Public Financial Reform, and Sub-National Democratic Development).
H.E. Masafumi Kuroki, Ambassador of Japan, provided some comments related to aid modalities mentioned in 2010 AER. He firstly appreciated RGC for selecting PBA as a tool to avoid aid fragmentation. He further clarified that PBA would be a very pragmatic approach for aid coordination. Secondly, he kindly asked RGC to reconsider some terms like “long term aid dependency” and “institutional weakness” which was used in AER 2010 on page 31 because these characters might not be appropriately applied to the Cambodia medium and long term perspective. In addition, he suggested RGC to improve and strengthen budget allocation for sectors in order to increase mutual accountability, harmonization, and integration between planning, budgeting, and development assistance. Besides DPs and CSOs, he urged RGC to use and promote private sectors as engine for economic growth.
Mr. Lun Bority, Executive Director of Cooperation Committee for Cambodia (CCC), raised three main issues relating to 1) role of NGOs in TWGs, GDCC and CDCF, 2) meaningful participation of NGOs in TWGs on national planning, monitoring process and the JMIs, and 3) trust and mutual understanding on genuine tri-partite dialogue. Moveover, NGOs would welcome to work with RGC to improve aid effectiveness at national and sub-national levels. Furthermore, NGOs also suggested RGC to increase the role and function of National Assembly in planning, monitoring and evaluation of the NSDP, foreign aid and national budget.
Response by RGC: H.E. Chhieng Yanara, regarding aid effectiveness implementation, reflected that the progress has been made even though some implementations have experienced less progress. In this case, RGC and development partners would work together to link aid effectiveness to development result. The result of JMIs showed the significant progress of cooperated work at sectoral level, and CRDB/CDC would continue facilitating this process.
Concerning 2010 AER, development partners provided the extensive detail and constructive comments on it. PBAs needed to be identified in more detailed in Cambodia context and in some particular sectors; however, it required the strong collaboration between RGC and development partners to approach these issues.
MYIFF would be an important source of budgeting and planning processes. Moreover, MYIFF and budget strategic plan, which reflected the external and internal resources, and recurrent and capital expenditure, would ensure the increasing of mutual accountability and sectoral budget allocation.
Representative from MoP responded that NSDP Update (2009-2013) was approved in the Council of Ministers meeting held on March 26th, and it was submitted to National Assembly on April 20th. The NSDP Update expected to be finalized on May 20, 2010. The integration between planning, budgeting, and ODA has made some progress, and the task force – including MoP, MEF, SNEC and CRDB – was established to discuss and monitor this process. Significantly, MoP helped to promote the use of Cambodia ODA Database, established by CRDB/CDC, to the government line ministries and agencies for preparing of PIP (2011-2013).
RGC would welcome the cooperated work with NGOs, particularly in TWG mechanisms. A separated session to discuss the roles of NGOs in RGC mechanisms is needed so that NGOs could express their interests and views that reflected the views of NGO communities as a whole. Thus, the ToR would need to be reviewed and updated to reflect the roles of NGO representatives in TWGs.
H.E. Chair concluded that the above agenda items were agreed by RGC and development partners. He further mentioned that partnership dynamic work was on-track, and we would work together to improve this issue through CDCF mechanism. The participation of NGO representatives in TWG mechanisms has been improved, and RGC would continually cooperate with NGOs at the national and sub-national levels.
In his closing remarks, H. E. Chair expressed thanks to DPs in regards to the effort they have made to support RGC in the preparation of CDCF.
The meeting was adjourned at 5:30pm.
Reported by Aid Coordination Policy Department