CDC - CBP - 4.4.3 CONCLUSIONS

4.4.3 CONCLUSIONS

111. The quantitative data collected through the survey and the quantitative information gathered through personal interview with donor representatives shows that donors are utilizing a range of terminologies to provide what is essentially an income supplement for recipients. These terminologies include: salary supplement, payment for special tasks, DSA, overtime payments, per diem, and allowances for attending workshops/seminars. The survey data shows that in many instances a recipient may be receiving more than one type of monetary incentives.

112. According to the data provided by donors, the expenditure on all type of monetary incentives totaled around US$ 6.7 million – representing 2.5 percent of the total expenditure on reported programs and projects. It is estimated that, out of the total expenditure of US$ 6.7 million on monetary incentives, around US$ 5.5 million were paid as a “salary supplement”. In terms of overall coverage of the capacity building survey, the programs/projects for which the external partners (multilateral and bilateral donors and NGOs) have provided information represent, in terms of total reported expenditures in 2002, around half of the total disbursements of all external partners in 2002. A simple extrapolation of the survey data based on the response rate of each donor category produces an estimate of total expenditure on all type of monetary incentives of around US$ 13.5 million on all ODA supported programs and projects in 2002. It should be noted, however, that this estimate is likely to be lower since the programs and projects for which data have not been reported by donors include large infrastructure projects and other ODA supported activities that may have a lower incidence of paying monetary incentives.

113. On the other hand, the results of the interviews with donor representatives summarized in the preceding section indicate a situation that lacks transparency and where donors may be violating their own rules and employing “spurious accounting practices”. Do these practices seriously undermine the reliability of the statistical data provided by the same donors? The study team believes that the probability of this being true is relatively low for the following reasons:

It is unlikely that donors would deliberately provide false data on their expenditures.
The perceptions of a donor's “spurious accounting practices” by other donors may be related to payments for activities other than what is called a “salary supplement” within the broad category of “monetary incentives”. The statistical data show that while a variety of terminologies are being employed, perhaps in some cases to avoid the term “salary supplement” for whatever reason, more than 80 percent of the expenditure on all types of monetary incentives was delivered as a “salary supplement” in 2002. It can, therefore, be argued that the perceptions of “spurious accounting practices” are unlikely to have any significant implications for the size of the total expenditure reported for all types of “monetary incentives”. These perceptions are more likely to be a reflection of poor communications and mistrust of each other’s activities among the donors.

114. The lack of transparency of donor practices on the payment of various types of monetary incentives is a serious issue that should be urgently addressed. More transparent donor practices will result not only in improved donor-donor relations but will also enhance the effectiveness of the ODA resources that are spent on the provision of the incentives. It seems clear that the issue of monetary incentives, in Cambodia like in a great number of developing countries, is intimately linked to the salary levels in the public service. If civil servants, even at fairly senior levels, are not provided with "a living wage" it is evident that they must supplement their income by other means, for instance by receiving a monetary supplement in a donor project.

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