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UK-Royal Government of Cambodia Development Partnership Talks, 25 April 2007
Minutes of meeting
Session 1: DFID strategy and vision
HE Keat Chhon opened the meeting noting the importance of this event for the Royal Government of Cambodia (RGC) for deepening the partnership between the UK and Cambodia. He highlighted three issues of importance to RGC: 1) the benefits of the jointly formulated CAP which had reduced the burden on Government and built on commitments made at Paris; 2) the commitment to deliver through programme based approaches and 3) the commitment to reducing transaction costs by ending separate bilateral projects. RGC said that the UK was a highly valued development partner, both for the financial support as well as the technical assistance provided through DFID, and they saw the DFID vision as very much supporting their own Harmonisation and Alignment Action Plan.
HE David Reader, British Ambassador made the opening remarks for the UK, welcoming the start of a more mature relationship, based on Cambodian ownership and leadership of the development agenda, and an already very positive relationship with the UK. Cambodia had made good progress in improving access to quality health and education services, as well as in improving economic stability. He hoped that the shared indicators for measuring progress towards the partnership commitments would be ‘do-able’ and drawn from existing commitments and mechanisms. He hoped the talks would pave the way for a new to year development partnership arrangement, with more predictable UK assistance.
Marshall Elliott gave an overview of DFID’s Country Assistance Plan which was produced jointly with the UN system, ADB and World Bank. He set out DFID’s vision for its support to Cambodia to 2011 and beyond. This included proposals for increasing the share of assistance provided through budget support to around 25%, reducing the number of projects and sectors DFID is engaged in, channelling all our assistance either through others or through budget support, as well as increasing the framework from approximately $25m in 2007 to $40m by 2011. The final figures will be confirmed after the UK Treasury completes its spending review in October 2007. Decisions on whether to move ahead with the vision as scheduled would be taken in consultation with government in early 2009, following an independent evaluation of the CAP and our partnerships in late 2008. He also explained the purpose of a 10 Year Development Partnership Arrangement and the next steps to take this forward.
In response to the presentation Dr Sok Saravuth, MEF, said that the Government was excited by the vision and fully supported it. They did however have concerns about the proposals to close the office, and hoped the UK would not lose interest in Cambodia after that point. Chhieng Yanara, CDC, confirmed his appreciation of the joint CAP process and of DFID’s role in championing aid effectiveness. He hoped DFID would keep in close contact with CDC and line ministries during the independent review. Dr Char Meng Chuor, MOH said that delegated partnerships were not new to the health sector and had worked very well.
Marshall Elliott responded that this was an ambitious vision and that performance by partners and practice on the ground was variable. When taking decisions on the future of the office and our programme DFID would behave responsibly. Globally DFID has to allocate more staff resources to the most difficult environments. Claire Moran said that the proposed funding increase was partly a result of increased funding globally for DFID, but also in recognition of areas where there has been considerable progress in Cambodia (e.g. in achieving health outcomes) and where we saw there was an opportunity to scale-up support to make more rapid progress towards the MDGs.
The session concluded with agreement that RGC was broadly in support of the vision as presented, that DFID should ensure to coordinate well with other development partners on our plans, and ensure we involve RGC closely in the independent evaluation and follow-up discussions. It was agreed that we would begin the process of developing a 10 Year Partnership Arrangement and that DFID would seek formal approval from new DFID Ministers in September, following the Ministerial changes anticipated over the next few months.
Session 2: Partnership commitments and budget support
Paul Walters gave a presentation explaining DFID’s approach to development and conditionality, the three partnership commitments that would be assessed annually (poverty reduction, human rights and public financial management & anti-corruption), the proposed benchmarks for measuring progress, and DFID’s plans in relation to budget support.
HMA David Reader emphasised that the DFID Conditionality Policy is applied globally and not just in Cambodia. Two reports, a DFID Country Governance Analysis and Human Rights Assessment had been commissioned to feed into the assessment, neither report was yet finalised, but they would be shared with RGC. He commended RGC for progress with revenue collection and poverty reduction, but also highlighted areas where progress had been slower as highlighted in recent GDCCs, such as anti-corruption and land reform. He asked RGC to identify focal points with whom DFID could discuss and agree proposed indicators, and emphasised the need for indicators to be realistic and achievable.
Sok Saravuth responded that DFID's commitment was consistent with other government plans, that progress with PRBS was encouraging and that the government was committed to bringing funds within the budget framework. He asked why PFM was listed as underperforming in the presentation material, and was also concerned that the anti-corruption indicator should not be attributed to the PFM programme. He emphasised that the PFM programme has no direct responsibility to solve corruption but that it can help indirectly. HE Keat Chhon stated that public procurement might be a good anti-corruption benchmark.
Paul Walters explained the basis of the DFID project scoring system, clarified the fact that there was no confusion between anti-corruption measures and the PFM programme, and pointed out that DFID wants to use these indicators to capture a range of activities including those being implemented outside MEF.
HE Chhieng Yanara underlined the importance to government of a longer term partnership commitment. He explained the JMI finalisation process and indicated that some of the new JMIs could be selected as indicators for the Partnership Principles. He was unclear as to whether the benchmarks were only for the PRSO programme or whether they covered the longer term Partnership Agreement?
Claire Moran agreed that the new JMIs would be used, and that only a small number (say up to 10) would be jointly chosen with a view to finalisation by September. Any benchmarks chosen would cover the whole programme including the PRSO and would help pave the way for the Development Partnership Arrangement. The DPA would probably not be finalised until after the 2008 national elections.
In relation to poverty-related spending, there was discussion about the RGC’s classification of Social Sector spending. DFID confirmed it would be happy to use the RGC classification (social sector comprise 9 ministries and 40% of allocated budget).
Marshall Elliott said that DFID takes the Conditionality Policy seriously: budget support was suspended in 12 countries last year where conditions were not met. He emphasised that a serious breach of one of the three partnership commitments would result in suspension of budget support. The UK aid programme is under the spotlight and Parliament and citizens ensure that DFID monitors anti-corruption measures in budget support countries. However he also noted that it is the trajectory that is important and that the country can start from a low baseline, however that baseline must be clear.
HE Keat Chhon, in his closing remarks agreed to continue to discuss the benchmarks with DFID and to finalise by September. It was agreed that HE Chhieng Yanara in CDC would be the overall contact point for developing and agreeing the benchmarks, HMA emphasised again that it would be useful for DFID to have the names of the individual focal points in government for each area, particularly for human rights.
Session 3: Portfolio planning and prioritisation
Claire Moran, presented DFID’s longer term plans for the Cambodia country programme and an overview of the performance of DFID’s project portfolio. The objective of this session was to get feedback from RGC on proposed priorities and future direction.
Longer terms plans include: increasing the framework from $25m in 2007 to $40m in 2011 (subject to the outcome of the UK’s Treasury’s Spending Review); focusing on a few large MDG-related investments (for example, scaling up in health and continuing rural development/D&D); increasing the share of budget support over time; increasing support to civil society on the accountability agenda to complement budget support; reduction in the number of small TA projects; and integration of common programmes where possible. These plans follow the vision for DFID support to Cambodia beyond 2011. Portfolio performance is taken seriously by DFID, with all projects over $2m scored annually.
Chhieng Yanara welcomed the proposals to scale-up assistance to Cambodia by 2010 and endorsed the forward pipeline as presented. He reiterated his appreciation for DFID’s continued emphasis on aid effectiveness and our role in co-facilitating the TWG on Partnership and Harmonisation. RGC particularly welcomed DFID’s new proposal to address rural sanitation, where the MDGs target is badly off-track and asked if the contribution could be increased. They encouraged DFID to consider efficiency in terms of number of activities within a given sector rather than looking to reduce the number of sectors DFID supports overall.
Sok Saravuth expressed strong support for DFID’s plan to channel assistance through budget support, which was in line with RGC’s scaling up plans. He asked for more information on DFID’s process for performance assessment and it was agreed that Paul Walters would provide for MEF [done], and Lizzie Smith would follow-up with MOH.
Dr Chour, MOH expressed concern that some of the data misrepresented DFID support to the health sector and asked for further explanation of the merging of some support for health and HIV (given the disparity in scores) which was provided by Lizzie Smith.
On lower scoring projects DFID clarified that this was an internal scoring approach and that projects can improve scores over time. RGC also raised concerns over donors’ different approaches to country assessment, for example in the area of PFM. The fact that donors have each their own scoring system and time frame not necessarily aligned on RGC’s fiscal year and budget cycle can undermine harmonisation efforts.
The meeting concluded with closing remarks by HE Keat Chhon on behalf of RGC, and by HE David Reader. Marshall Elliott provided a summary of the main conclusions of the meeting which were that:
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