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BACKGROUND 1. This study on the capacity building practices of Cambodia's development partners was commissioned by the Government-Donor Partnership Working Group. Its purpose was primarily to document existing capacity building practices of donors and to outline options and make recommendations on feasible solutions to achieve a more harmonized approach for capacity development. 2. The methodology used to carryout the study included personal interviews with donor and government representatives, and quantitative data was collected through a questionnaire sent to most donor agencies and NGOs. In response to this questionnaire the UN agencies have provided information for nearly all of the programs/projects they delivered in 2002. The other multilateral donors (IMF, World Bank, Asian Development Bank, and the European Commission) have responded to a lesser degree. The responses from the bilateral donors have been rather disappointing. In the case of NGOs, 77 percent of the organizations that were contacted provided the requested information. In terms of overall coverage of the capacity building practices survey, the total expenditure in 2002 on programs/projects for which the external partners (multilateral and bilateral donors and NGOs) have provided information represent around half of the total ODA disbursements of external partners in 2002 that have been reported to CDC. 3. The survey questionnaire covered five areas that are related to building the individual and institutional capacity and the employment of personnel to support the implementation of the programs and/or to fill capacity gaps. These five areas include: training, operational support, monetary incentives, and the employment of national and international personnel. MAJOR FINDINGS 4. An expenditure of 115.3 million US dollars on the five capacity development activities has been reported by the 147 multilateral and bilateral programs/projects and the 77 NGOs – representing 43.4 percent of the total expenditure in 2002 on the implementation of these programs (around 265 million US dollars). Of the total reported expenditure of 265 million US dollars, the expenditure on specific capacity development activities, included:
5. The largest expenditure, some 34 million US dollars, was on international personnel employed to support the implementation of the programs for which data has been provided. It represented about 45 per cent of the total wage bill for the Cambodian civil administration in 2002. If account is taken of program expenditures not covered by the responses to the questionnaires, it can be estimated that expenditure for international personnel could be as high as 50-70 million US dollars compared to total wages and salaries of less than 78 million US dollars paid in 2002 for all personnel employed in the civil administration. The civil administration includes in addition to the civil service, the National Assembly and the various Councils. The expenditure on international experts in relation to the total wage bill for the civil service underscores the importance and urgency of embarking on a major effort to upgrade the skills and expertise of civil servants to reduce continuing reliance on international experts. 6. Training constituted the second largest component of reported expenditure on capacity building activities, a total of 31.4 million US dollars representing 11.8 percent of reported expenditure or 27 per cent of the total expenditure on all capacity building activities. Nearly 90 per cent of the projects for which data have been provided indicated supporting some type of training activity. A crude extrapolation of these data for all donor supported projects yields an expenditure level of around 60 million US dollars on training. Most of the training, both in-country and abroad, seems to be for short-term courses, seminars and workshops covering a very wide range of subjects. It can be questioned whether such short term training is the best way to upgrade the skills of the personnel concerned and to create a sustainable knowledge base. There is an urgent need to carry out a comprehensive study that provides an assessment of the needs and the existing capacity gaps in the civil service, and to develop based on this assessment a comprehensive training and learning strategy/plan not only to fill the critical gaps but also to better target the significant ODA expenditures on what has been reported as training. While some ad hoc training in the context of the implementation of a project can be justified, the need to tackle the training issues in the larger context of filling the capacity gaps within the framework of a comprehensive training strategy/plan can not be over-emphasized. One element of such a comprehensive training strategy could be the creation of civil service staff training institutes for three broad categories of civil servants: those at the most senior levels, the middle level, and the entry level. 7. The provision of operational support, including equipment, on which an expenditure of close to 22 million US dollars has been reported, was considered by practically all respondents who utilize this modality to be either critical or important for program delivery. It should be noted that sometimes such support can constitute an "incentive in kind" by creating a better work environment. 8. The donor supported programs are a significant employer of qualified and experienced national personnel. Practically all national personnel employed on these projects have long-term employment relationships. Given that donor funded projects pay significantly better salaries than the civil service, even when account is taken of various allowances and donor funded incentives, it is obvious that these projects attract the most competent people, particularly if they can get leave of absence from a civil service position and maintain their security of employment. To create a more level playing field, there is an urgent need for the Government to consider requiring public servants who take employment in a donor funded program or project to resign from their civil service position. 9. The expenditure on monetary incentives reported by Cambodia’s external development partners in the implementation of 147 projects and by 77 NGOs is the smallest of the five components of capacity building, totalling only 6.7 million US dollars representing 2.5 per cent of reported expenditure or 5.8 per cent of expenditure on capacity building. 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. Monetary incentives cover a variety of measures: salary supplements, payments for special tasks, DSAs and per diems, attendance allowances and other unspecified forms of incentives. Altogether some 20,000 persons, over 12,000 by NGOs, were paid some form of monetary incentives in 2002, the overwhelming majority at local or district level. However, of the 20,000 only 4,760 persons have been reported to have been paid a "salary supplement". In most cases the salary supplements reported were less than 80 US dollars per month but in some cases exceeded 500 dollars per month. The current average monthly salary level of 28 US dollars per month that is projected to be increased to 51.5 US dollars by 2006 is well below what is considered to be a “living wage”. Based on the available information on the projected key macroeconomic indicators to the year 2008, it is unlikely that a significant increase in salaries from the projected levels can be implemented through domestic budget resources. Therefore, it would appear that for donors to get the commitment of counterpart personnel in collaborating institutions in the implementation of their programs some form of monetary incentive will need to be paid. The issue is whether it is done openly in a transparent and accountable manner or through spurious accounting practices. In personal interviews most donor representatives have stressed the need for more transparency and harmonisation of donor practices on the payment of monetary incentives. RECOMMENDATIONS 10. It is recommended that: i. A comprehensive study should be carried out that will provide an assessment of the needs and existing capacity gaps in the civil service and that based on this assessment a comprehensive training and learning strategy/plan be developed to fill the critical gaps through a more targeted training effort. ii. In the preparation of the training strategy/plan consideration should be given to the option of establishing “civil service training institutes” for three broad categories of civil servants: those at the most senior levels, the middle level and the entry level. Of particular urgency is the upgrading of skills of civil servants who will replace the trained and experienced top officials who have now begun to retire to avoid a potential deterioration in the governance structures over the next decade. Such institutes should be staffed by competent professionals paid at market rates and preferably should be residential. Given the extreme constraints on domestic resources, the development partners need to seriously explore whether some of the reported expenditures on training can be systematically channelled for supporting the Public Service Training Institutes. Consideration should also be given by bilateral donors who have similar public service institutions to offer scholarships to qualified Cambodian candidates. Based on the realities on the ground, the external development partners should acknowledge the necessity of providing monetary incentives through a transparent, harmonized and accountable system. A reform in this area will, however, depend on a real and sustained political will by all donors and by the government alike to change the present system. It is recommended that the:
iv. Civil servants who take employment in donor funded projects should be required to resign from their civil service position. |
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