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momentum that had been
successfully built during the second mandate of the Royal Government. With
the formation of the new Government in July 2004, the Royal Government of
the Third Legislature of the National Assembly remains committed to continue
to vigorously implement its reforms agenda. Progress made in each of the
priority areas since the 6th CG Meeting (June 2002), in spite of the many
challenges faced, is summarized below.
2.1.1
LEGAL AND JUDICIAL REFORM AND GOVERNANCE
LEGAL AND JUDICIAL REFORM
15.
At the 6th CG Meeting, the following benchmarks were established in this
area:
-
Time bound
legal and judicial reform strategy completed.
-
Supreme Council
of Magistracy restructured.
-
Law on Statute
of Magistrates submitted to Parliament.
16. Time bound Legal and Judicial
Reform Strategy Completed: Significant progress has been made in this
area. The Royal Government established the Council for Legal and Judicial
Reform (CLJR) in June 2002, co-chaired by the then Senior Minister in charge
of the Council of Ministers and the President of the Supreme Court. In
August 2002, a Permanent Coordinating Body (PCB) was formed to bring
together key decision- makers from each relevant institution and in December
2002, a Project Management Unit (PMU) was created to assist to
both the PCB and the CLJR. Under the guidance of the CLJR, a
Legal and Judicial Reform Strategy was developed and endorsed by the Royal
Government in June 2003. This strategy consists of 7 objectives:
-
Improvement of the
protection of fundamental rights and freedoms.
-
Modernization of the
legislative framework.
-
Provision of better
access to legal and judicial information.
-
Enhancement of the
quality of legal processes and related services.
-
Strengthening of judicial
services, i.e. judicial power and prosecutorial services.
-
Introduction of
alternative dispute resolution mechanisms.
-
Strengthening of legal
and judicial sector institutions to fulfill their mandates.
17. Also in June 2003, a draft Action
Plan was prepared. This formed the basis of discussion at a National
Workshop held in December 2003, under the leadership of the PCB, that
brought together stakeholders from concerned Government institutions, civil
society and the donor community. Following the workshop a series of
consultations were carried out that led to the development of a
comprehensive list of short and medium term priorities. The short term plan
of action (2004-2006) consists of 33 priorities across the 7 strategic
objectives. The medium term of action identifies another 27 priorities to
be attained by 2008. These plans recognize the progressive process
of working towards the achievement of the 7 objectives in the Legal
and Judicial Reform Strategy.
18. Supreme Council of Magistracy
(SCM) Restructured: The amendments to the Law on the organization and
functioning of the Supreme Council of the Magistracy have been drafted and
approved by the Council of Ministers and are awaiting approval of the
Parliament. The process of restructuring the SCM is now well underway with a
Secretariat in place and the requirements for a fully functioning SCM are
now being determined. In January 2003, the Royal Government has
substantially increased remuneration of judges and prosecutors. The Royal
School of Magistracy and the Lawyer Training Centre are now operational. A
model court is being established at Kandal Province to develop best practice
in processing cases; new court facilities which support the implementation
of the practices will be completed by 2006. Work is also underway on the
establishment of specialized tribunals to better deal with
commercial, juvenile and administrative matters. Core institutions such as
the SCM, the Council of Jurists, the Ministry of Justice, and functions
supporting the reform program such as the PCB and PMU are all being reviewed
and strengthened. Resources are being directed towards reform activities.
With a few exceptions, most of these have been financed by the Royal
Government.
19.
Law on Statute of Magistrates Submitted to Parliament:
The
draft of the Law on the Statue of Magistrates and the Organic Law on the
organization and functioning of the Courts are being drafted. These are
planned to be submitted to the Parliament in 2005 according to the
priorities of the short-term action plan for legal and judicial reforms.
20.
Other significant achievements include the enactment of many
important Laws related
to protection
of human rights, laws on investment, trade and commerce and laws in support
for natural resources management. The Civil Code and Procedures and the
Penal Code and Procedures have been drafted and are being reviewed by the
Council of Jurists and will be submitted to the Council of Ministers and the
Parliament by 2005.
21. Although Cambodia’s development
partners emphasize the importance of reforms in this area, only a few have
provided support to date. Judicial reforms have been identified by the
Investment Climate Survey as critical for creating an enabling
environment for private sector development. At a more basic level, improved
access to justice and judicial services for the poor is essential to tackle
feelings of social injustice and vulnerability, improve community confidence
on the rule of law and quality of life and reduce poverty.
22. Legal and judicial reforms are
complicated further by the social context in Cambodia. Three decades of
destructive war, torment and internal struggle have left deep psychological
scars and underlying tensions. A growing youth population and rapid social
change being encouraged by technology and greater integration into regional
and global trends has challenged traditional values and virtues. The
society is in transition. At the same time, the shortage of Cambodian legal
experts has meant that much of Cambodia’s existing legal framework has been
heavily influenced by international experts. This has created a range of
inconsistencies which make enforcement difficult. Law enforcement remains a
challenge for a range of reasons but especially low salaries. It is
difficult to enforce laws transparently and without fear or favor when the
salaries of law enforcement officers are lower than a minimum subsistence
level.
23. The
Royal Government has placed a high
priority on putting in place basic elements of the legal framework to
underpin the development of a vibrant market economy and the promotion of
trade and investment by developing the legal framework on property rights,
the creation and winding-up of business entities, banking, tax and
accounting, insurance, secured transactions, commercial enterprises,
bankruptcy, contracts and commercial credit, and law on negotiable
instruments and payment transactions in order to ensure the effective
functioning of the financial sector.
24. To increase access to legal and
judicial information, not only for legal and judicial professionals but also
for the citizenry, the Royal Government has created the Office of the
Gazette as a General Department paving the way for it to operate under a
self-supporting commercial model. The President of the Supreme Court (Chief
Justice) has committed to publishing judicial decisions to improve
transparency of the judicial process and building a body of Cambodian
jurisprudence. The process of collecting existing decisions is now underway.
COMBATING CORRUPTION
25.
In this area the benchmarks established at the 6th CG Meeting included:
-
Anti-corruption
Law submitted to the Parliament.
-
Reported cases
of corruption investigated and prosecuted appropriately within existing
legal framework.
26. A draft of the Anti-Corruption
Law was prepared and approved by the Council of Ministers on 20 June
2003 and submitted to the Parliament on 25 June 2003. This draft was
returned by the Parliament for a further review. This review process was,
however, slowed by the delays in the formation of the new Government.
Building on the input provided by the development partners at the Pre-CG
Meeting held in September 2004, the Royal Government will complete the
review and a revised draft of the Anti-corruption Law will be submitted to
the Parliament. The Royal Government agrees with the development partners
that a holistic approach to combating corruption is needed. While the
enactment of the Anti-corruption Law is an important step, developing
capacity to rigorously enforce the Law is also equally important. To combat
corruption, that takes a toll on economic performance and undermines the
efforts to reduce poverty, a lot of other measures in addition to the
enactment of the Anti-corruption Law are needed. Some of these measures such
as streamlining bureaucratic procedures, simplifying and modernizing the tax
system, eliminating excessive regulations, and motivating public servants by
giving them a decent level of salaries can help reduce the opportunities for
corruption. At the same time, the Royal Government is mindful of the fact
that changing peoples attitudes and behavior may take some time.
27. Cases of corruption
investigated and prosecuted: Notwithstanding tremendous difficulties and
impediments, the RGC has made significant progress in combating corruption
by addressing its root causes. Cracking down on illegal logging, more
effective management of Government revenues and expenditures, the removal
of ghost workers from the public service and the army payrolls and the
confiscation of land, which had been sold off or held illegally, were among
the measures aimed at tackling corruption. A National Audit Authority (NAA)
has been established and is now operational as a check and balance mechanism
to control revenue collection and expenditure management. The internal
audit functions in line ministries are being strengthened. The NAA is
working with these internal audit units in ministries to ensure a greater
transparency and accountability.
PROCUREMENT
28.
In this area the benchmarks established at the 6th CG Meeting included:
-
Provisions of
Sub-decree implemented in key social and economic ministries for
expenditures under chapters 11 and 13 of the budget.
-
Indicative time
table for expansion to all expenditure categories for all ministries
discussed with partners.
29. The
scope of the implementation of the provisions of the Public Procurement
Sub-decree was extended to cover all expenditure categories in all
ministries, except the Royal Palace.
2.1.2 NATURAL RESOURCES MANAGEMENT
RATIONALIZATION OF FOREST CONCESSION SYSTEM
30.
In this area the benchmarks established at the 6th CG Meeting included:
-
No exploitation
in any forest concession until an SFMP, including environmental and social
impact assessment (ESIA) has been submitted and approved according to
provisions of the Sub-decree on Forest Concessions Management.
-
Public
disclosure and opportunity for independent experts, including one observer
from WGNRM, comment on SFMPs and ESIAs prior to finalization of Government
review.
-
Concessionaires
who do not submit SFMPs have concessions cancelled.
31. In keeping with the Royal
Government's commitments no new forest concessions have been issued
since 1 January 2002 and the operations of the existing holders of forest
concessions licenses have been limited to small salvage operations and
maintenance work in accordance with the existing laws. The concessionaires
were asked to submit Strategic Forest Management Plans (SFMP) along with an
Environment and Social Impact Assessments (ESIA) in September 2002.
Thirteen concessionaires submitted their plans and ESIAs in November 2002
that were used for consultations with affected communities.
32. With respect to public
disclosure and opportunity for independent experts to comment on SFMPs and
ESIAs prior to finalization of Government review, with technical support
from the World Bank, the Royal Government carried out reviews of the SFMPs
and the ESIAs submitted by concessionaires. The SFMPs & ESIAs were shared
with the concerned communities. Recognizing that because of the technical
details and complexities of the Strategic Forest Management Plans (SFMPs)
and Environmental and Social Impact Assessments (ESIAs) the concerned
communities may not be able to provide comments immediately these
communities have been provided an unlimited timeframe to complete the
consultation process. The SFMPs and ESIAs have been distributed to 245
communes in communities that are in or around forest concessions. The DFW/FA
teams have consulted with and documented the concerns of the communities.
The DFW/FA has asked concessionaires to incorporate suitable solutions to
respond to the concerns of the communities in their management plans. By the
end of July 2003, the Technical Review Team (TRT) of the DFW/FA, with World
Bank's technical support, had completed its review and the findings have
been provided to the twelve forest concessionaires. The revised SFMPs are
being reviewed by an Independent Review Team of the Donor Working group on
Natural Resource Management. To ensure transparency of the evaluation
process and to minimize “mistrust and suspicion,” as well as misperceptions,
that have characterized and in some instances unnecessarily polarized
opinions, the DFW/FA has established a Public Affairs Unit to enhance
communications among all parties.
33. The licenses of
concessionaires who did not submit SFMPs have been cancelled. From 1999
to-date, the Royal Government of Cambodia (RGC) has cancelled forest
concession licenses of 17 companies covering total forest land area of
around 3.5 million hectares in 24 locations. The licenses of 5 forest
concessionaires, Hero Taiwan, Wood Tee Peanich, GAT International, Mieng Ly
Heng and Kingwood were cancelled during the reviewing process of the SFMPs.
As of now, there are only 12 concessionaires who are in the process of
planning their concessions and will be required to ensure the sustainability
of the forests according to international standards. These twelve
concessionaires have been allocated a total of less than 3.4 million
hectares of forest land. The Royal Government has continued to maintain the
moratorium on logging by all concessionaires until their Strategic Forest
Management Plan and the ESIA has been officially approved by the Government.
34.
The Royal Government of Cambodia has continued to pursue vigorously illegal
logging operations. In the course of performing their duties 7 forest
administration officers have been killed and 34 have been injured. Some
1,386 illicit sawmill plants, 653 timber processing handicraft, 39 medicinal
vine powder manufacturing handicraft, 24 Tepiro oil manufacturing
handicraft, 159 aloe steaming and forest sub-product processing ovens have
been removed, destroyed and put out of business, and 332 offenders have been
apprehended and prosecuted.
35.
Illegal logging, wildlife smuggling, corruption and encroachment on forest
land have been reduced from the crisis proportions prior to the Government’s
reform program. The Government’s crackdown on illegal logging has consisted
of measures across the full spectrum of forest law enforcement, prevention,
detection and suppression. The RGC's entire approach to resource
management, including concession management reform, community forestry and
protected areas management is aimed in large part at preventing crime. In
June 2004, the Royal Government issued Order No 01BB to prevent, suppress,
and eliminate forest land clearing and encroachment and has established a
National Committee and Sub-national Committees at the provincial level to
implement this order.
LEGAL FRAMEWORK FOR COMMUNITY-BASED NATURAL RESOURCES
MANAGEMENT
36.
In this area the benchmarks established at the 6th CG Meeting included:
-
ESIA requirements for new
forest, fishery and land concessions fully implemented.
-
Community Forestry
Sub-decree finalized and passed based on substantial consultation with
affected communities.
-
Social Concessions
Sub-decree finalized and passed based on substantial consultation with
affected communities.
-
Community Fisheries
Sub-decree finalized and passed based on substantial consultation with
affected communities.
37. As mentioned earlier,
complying with the ESIA requirements in the forestry sector is an
integral part of the review of the forest concessions that is now taking
place.
38.
The Sub-decree on Community Forestry was enacted in December 2003 to
put public forest assets under the stewardship of local communities in the
framework of approved management plans and benefit sharing arrangements. The
Sub-decree was the result of over six years of consultations with many
stakeholders and advisers and compliments other measures, such as the
Sub-decree on Social Land Concessions to make the country’s land resources
more productive and better managed. The Royal Government has been working in
partnership with various donor agencies and non-governmental organizations
to pilot community forestry initiatives in different parts of the country.
So far, nearly 110,000 hectares had been developed under community forestry
arrangements.
39.
The Sub-decree on Social Land Concessions
was enacted by the Royal Government in March 2003. To implement the
sub-decree at the national, provincial/municipal, and district/Khan levels,
pilot projects were carried out in three communes and one Sangkat in the
Battambang, Kampot, Kampong Speu provinces, and Phnom Penh. Based on the
results of pilot projects and the poverty social impact assessment study on
social land concessions project, the Council of Land Policy in collaboration
with various development partners is currently involved in designing a
program for Land Allocation for Social and Economic Development (LASED).
40. The Royal Decree on the
establishment of community fisheries and a Sub-decree on the management
of community fisheries have been prepared and submitted to the Council of
Ministers for approval. Although the legislative process is still underway
some 360 community-fishery lots have already been established across the
country with assistance from development partners. The Fisheries Law has
been reviewed by the Council of Ministers and is scheduled to be submitted
to the Parliament.
2.1.3
SOCIAL SECTORS
BUDGETARY DISBURSEMENTS TO SOCIAL SECTORS
41.
In this area the benchmarks established at the 6th CG Meeting included:
-
Budgetary disbursements
to four priority action ministries increased to 3.6 percent of GDP.
-
Disbursements to health
ministry at the national and provincial levels are at least 35 percent of
budget under Chapter 11 and 40 percent under Chapter 13 at both the
national and provincial levels.
-
Disbursements to the
education ministry are at least 40 percent of budget under Chapter 11 and
50 percent under Chapter 13 at both the national and provincial levels.
-
Disbursements for both
health and education ministries approach 100 percent for both chapters 11
and 13.
42. Budgetary disbursements to four priority action
ministries increased to 3.6 percent of GDP: Following the 6th CG Meeting
the work on updating the historical data series on GDP going back to 1993
was completed by the National Institute of Statistics (NIS), with IMF
assistance, in late 2002. A number of revisions were made to the GDP series
based on new and revised data from government line ministries and other
agencies, as well as revised compilation methods. The end result was an
overall increase in GDP levels going back to 1993. For the 1998-2002 period,
the estimates of GDP in current prices were revised upwards, for example by
10.1 percent for 1998, and 15.8 percent for 2000. Because of these GDP
revisions, the benchmark set at the time of the CG Meeting in June 2002
would be somewhat lower when the significant upward revision of the total
GDP estimates is taken into consideration. Based on the revised estimates of
GDP, the actual disbursements to PAP ministries totaled 3.3 percent of GDP
in 2002. In the Budget Law for 2003, the allocations for PAP ministries were
around 3.6 percent of GDP. However, because of significant revenue
shortfalls resulting from both domestic factors (the violent demonstrations
in Phnom Penh in early 2003 and uncertainties in both the pre and
post-general election periods) and international factors (outbreak of SARS
in the region and the Iraq war), the actual disbursements have fallen short
in many areas including PAP ministries. The actual disbursements to PAP
ministries amounted to around 3.3 percent of GDP in 2003. However, the
amount of actual disbursements have slightly increased from 512.1 billion
CRs in 2002 to 529.4 billion CRs in 2003.
43. Disbursements to health
ministry at the national and provincial levels are at least 35 percent of
budget under Chapter 11 and 40 percent under Chapter 13 at both the national
and provincial levels; and disbursements to the education ministry are at
least 40 percent of budget under Chapter 11 and 50 percent under Chapter 13
at both the national and provincial levels: The implementation of these
two benchmarks would have required allocating 75 percent of the Chapter 11
budget and 90 percent of the Chapter 13 budget to the two ministries, that
is the Ministry of Education and the Ministry of Health. Accommodating such
a drastic reallocation of the chapter 11 and 13 budgets to these levels has
not been possible. However, the budget allocations of chapter 11 and 13 for
the Ministry of Health were increased from 152.4 billion CRs in 2002 and to
166.5 billion CRs in 2003. In the case of the Ministry of Education, the
budget allocations for chapters 11 and 13 were increased 130.1 billion CRs
in 2002, and to 136.1 billion CRs in 2003.
44. Disbursements for both health
and education ministries approach 100 percent for both chapters 11 and 13:
For the Ministry of Health, actual disbursements as a percent of budget
allocations for chapters 11 and 13 were 88.1 and 99.9 percent in 2002 and
84.6 percent and 93.5 percent in 2003. In the case of the Ministry of
Education, actual disbursements as a percent of budget allocations for
chapters 11 and 13 were 87.1 percent and 107.2 percent in 2002 and 95.1
percent and 85.1 percent in 2003.
HIV/AIDS PREVENTION
45.
In this area the benchmarks established at the 6th CG Meeting included:
-
HIV/AIDS
legislation enacted.
-
Free radio and television time
for HIV/AIDS programs provided.
46. HIV/AIDS legislation enacted:
The Law for Prevention and Control of HIV/AIDS was approved by the
Parliament in June 2002. For the Royal Government the prevention of HIV/AIDS
and improvement in the quality of life of those infected and/or affected by
HIV/ AIDS through provision of care and welfare services is a national
priority. The Law on the Prevention and Control of HIV/AIDS provides the
framework for implementing the preventive, curative, and mitigating
measures.
47.
The National Aids
Authority (NAA) that was created in January 1999 is responsible for
coordinating and facilitating the implementation of comprehensive
preventive, care and support, and mitigating measures. In 2001, the NAA
launched the "National Strategic Plan for Comprehensive and Multi-sectoral
response to HIV/AIDS: 2001-2005". Subsequently, five Ministries -- Health;
National Defense; Education; Social Affairs, Labor and Youth Rehabilitation;
and Rural Development -- have developed Strategic Plans to respond to
HIV/AIDS challenges. In addition, the Battambang and Siem Reap Provinces
have also developed Comprehensive and Multi-sectoral Plans to respond to
HIV/AIDS challenges. The NAA is comprised of 26 Ministries and 24 Provinces
and Municipalities. In March 2003, the NAA established a Coordinating
Committee that has been meeting regularly each month to coordinate with UN
agencies, donors and major NGOs. To plan and implement campaigns during
World AIDS Day, Water Festival and Candle light Memorial the National Aids
Authority has established mechanisms to coordinate the work of the
governmental and non-governmental organizations.
48.
The combined efforts of
Royal Government's institutions and development partners have begun to show
positive results. It is estimated that the number of persons living with
HIV/AIDS has declined from 175,000 in 1998 to 157,500 in 2003. The
prevalence of HIV infection among 15 to 49 years old has declined from 3.3
percent in 1998 to 2.6 percent in 2003. Almost 100,000 people have undergone
testing and provided counselling services. The voluntary and confidential
testing services are now provided in 20 provinces and municipalities through
65 VCCT Centers of which 26 are managed by NGOs. Some 2000 AIDS patients now
have access to free Anti Retroviral Therapy (ARV). The implementation of
country wide 100 percent Condom Use Program has succeeded in reducing HIV
prevalence among Sex Workers from 54 percent in 1998 to 37 percent in 2003.
The Peer Education Programs are being successfully implemented among the
civil, defense, and police personnel. Some 50,000 monks have integrated
HIV/AIDS issues into moral preaching. HIV/AIDS education programs are also
being implemented by the private sector for their employees.
49. Free radio and television time
for HIV/AIDS programs provided: Significant progress has been made in
securing free radio and television time for HIV/AIDS programs. Some TV
stations have been providing free time for broadcasting HIV/AIDS prevention
messages. Also private sector sponsors have begun to provide airtime on
their programs, for example, Cambrew incorporates HIV/AIDS messages into
their weekly Karaoke program on TV. There has also been significant increase
in donor support for developing broadcast material, for example, DFID's
support to the BBC World Service Trust to produce radio and TV spots and
dramas; UNDP, UNESCO and UNICEF have also produced short programs. There has
also been an increase in donor support to broadcasting the messages – DFID
has been supporting broadcasts on TV5, and UNICEF has also been supporting
the broadcast of the same material on other channels to reach a wider
audience.
2.1.4
FISCAL MANAGEMENT AND PUBLIC ADMINISTRATION REFORM
CIVIL SERVICE REFORM AND MEDIUM TERM EXPENDITURE FRAMEWORK
50.
In this area the benchmark established at the 6th CG Meeting was as follows:
"based on studies, assisted by World Bank, medium-term civil service reform
plan prepared to improve civil service salaries to a level broadly
competitive with private sector labor market, including departure and safety
net provisions for redundant workers and financing options consistent with
Medium-term Expenditure Framework".
51. The National Program for
Administrative Reform (NPAR) was approved by the Royal Government in early
1999. In October 2001, the Royal Government approved the strategy to
rationalize the civil service. As part of this strategy, the Council for
Administrative Reforms (CAR) was mandated to investigate options for
accelerating pay and employment reforms. It undertook to carry out the
following six studies to collect factual information and prepare analysis
based on which decisions could be made to accelerate pay and employment
reforms and to strengthen the management of the Civil Service:
-
improving
public services delivery;
-
benchmarking
the labor market;
-
reviewing
operations;
-
enhancing
remuneration to support performance;
-
enhancing
employment to support service delivery; and
-
strengthening
the management of the civil service work force.
52. In April 2002, the World Bank
agreed to finance five of these studies. The Terms of Reference for these
studies were agreed to in March 2003 and funding from the World Bank was
secured in May 2003. Since May 2003, the study on improving public services
delivery was completed in September 2003. The Labor Market Survey of Pay and
Benefits was completed in September 2004. With technical assistance from
Brunei, work is now underway to document and strengthen Human Resources
Management processes and practices. The HRMIS is being strengthened with
support from the E.U. to become a potent tool to forecast staffing patterns,
manage public service work force/establishment, and foster the
development of human resources.
53. The Operations Review will be
launched shortly to document and complement work underway in priority
ministries (education, health, agriculture, justice). This study will take
stock of progress and develop a replicable methodology and framework to
carry out such reviews. It will also carry out targeted pilots to implement
the methodology and a training effort to develop the government’s capacity
to review operations.
54. With respect to a wage policy for
the civil service, the actions of the Royal Government will be based on two
basic principles. First, any changes must respect the principle of
relativity among the various categories of government employees (political,
civil servants, military and security). Secondly, they must be financially
sustainable over time within the fiscal framework. Accordingly, increases in
remuneration will remain dependant on available funds and thus on government
revenues. The RGC is committed to increasing remuneration by 10 to 15
percent annually. The available resources will be targeted to priority needs
through instruments like the PMG program and a system of allowances that
complement base pay. The CAR Secretariat routinely carries out simulations
to assess options. The work on remuneration policy study will be
piggy-backed on the operational review that will be launched in early 2005
based on revised TORs.
55. The study on employment policy
will also be launched in early 2005 to strengthen the existing information
base on employment needs and to design mechanisms to effect necessary
adjustments in the configuration of the Civil Service. Decisions relating to
the last study on managing the civil service workforce will await the
conclusion of related work already underway.
56. During the first phase of
implementation of the NPAR program efforts were focused on the following
five major activities: to document and control the composition and
distribution of the Civil Service workforce; to develop essential
instruments to manage and motivate personnel; to assess needs of ministries
relating to corporate services (back office); to complete preparatory work
to move the Administration closer to citizens; and to strengthen the
capacity to plan and manage the reform. Under the NPAR program the following
has been achieved:
-
The data on the
composition and characteristics of the civil service was collected and
analyzed. As a result, there is now a good understanding of the
composition and characteristics of the civil service workforce at the
national and sub-national levels.
-
The core legal and
regulatory framework on the civil service has been developed and is now in
place.
-
Human resources
management systems, including the Human Resources Management Information
System (HRMIS), have been developed and are now operational to plan and
manage the civil service workforce.
-
A new pay and employment
regime more conducive to performance assessment and career progression has
been developed and is now in place.
-
Innovative policies have
been designed to marshal available resources to enhance performance in
priority areas, such as the Priority Mission Groups (PMGs), targeted
allowances, and one-window offices at the sub-national level.
REVENUE COLLECTION
57.
In this area the benchmarks established at the 6th CG Meeting included:
-
Government
revenue increased to 12.75 percent of GDP.
-
Increased
revenue from payments for leases of state assets; collection of
outstanding tax arrears and performance under the pre-shipment inspection
program.
-
Strengthened
tax auditing and administration.
-
Increased
transparency of terms of Government contracts.
58. Government revenues increased
to 12.75 percent of GDP: As mentioned earlier, following the 6th CG
Meeting the historical data series on GDP going back to 1993 was revised by
the National Institute of Statistic (NIS), with IMF assistance, in late
2002. Because of significant upward revisions of the GDP estimates, the
revenue growth target of 12.75 percent that was established based on the old
GDP data would be significantly lower when calculated using the revised GDP
data. It should be noted, that the review of progress presented in this
report is based on the revised GDP data.
59. In spite of the many challenges
faced by the Royal Government over the last five years -- that have included
the restructuring of the tariffs along with lowering of the maximum tariff
rate, and the challenges of controlling smuggling and tax evasion -- the
Royal Government has been making steady progress in increasing its revenues
collection. A vigorous implementation of the fiscal reforms, with the
support of development partners, and implementation of revenue enhancement
measures has begun to produce fruitful results. Revenues as a percent of
revised GDP estimates increased from 8.1 percent in 1998 to 11.1 percent in
2002. In the year 2003, the revenue collection suffered not only from the
effects of the outbreak of SARS in the region, the violent demonstrations in
Phnom Penh in early 2003, and the Iraq war, along with continuing
inefficiencies in tax collection but also by the election-related
uncertainties in the first half of 2003 and the delays in the formation of
the new Government following the 27 July 2003 elections.
60. The environment of uncertainty
that prevailed in 2003 had also adversely effected the collection of
revenues from payments for leases of state assets;
collection of outstanding tax arrears and performance under the pre-shipment
inspection program
61. Strengthened tax auditing and
administration: The National Audit Authority (NAA) that was
established in early 2000 is now functional and its capacity is being
strengthened. The NAA is completing its audit report for the years 2000,
2001 and 2002 that will be presented to the Parliament. The internal audit
functions in line ministries are also being strengthened. The NAA is working
with these internal audit units in ministries to ensure a greater
transparency and accountability.
62. Increased transparency of
terms of Government contracts: To enhance transparency and to minimize
abuses, the scope of the Public Procurement Sub-decree has been extended to
all ministries, except the Royal Palace. |
