In the 1990s, Cambodia underwent a period of emergency relief and reconstruction during which it was heavily dependent on external assistance. The level of external assistance to education consistently surpassed the government’s own education budget throughout 1994-1999 (Table 6-1). During 1994-1996, external assistance to the education sector increased rapidly from $29 million to $44 million. The assistance during this period concentrated on technical/vocational education and higher education (around 40 per cent), while support for basic education was limited. However, since the mid-1990s, donor support has gradually shifted towards basic education. The major donors that have contributed to this shift include EU, Sida (through UNICEF) and ADB. The political crisis in 1997 had a negative impact on donor assistance, which declined by nearly 40 percent from $53 million in 1997 to $34 million in 1999, but still exceeded the government’s spending on education.

The Education Investment Plan 1995-2000, developed with the financial support of ADB, was an early attempt to coordinate donor assistance to the education sector. However, the plan achieved only a limited success, as described in the government’s own assessment in 2000²⁹. This report acknowledged the sector’s disappointing performance despite substantial donor assistance over the past decade, and addressed the need for more sustainable and policy-led reform. The limited impact of aid to education during the 1990s was also attributed to the proliferation of discreet and unconnected donor projects, which aggravated policy fragmentation.

With the recognition of the need for a different approach to address those problems, the Sector-Wide Approach (SWAp) was envisaged in the education sector. The government’s new paradigm that advocated a shift from "donorship to government-led ownership and partnership" presented at the CG meeting in 2000 also drove the MOEYS and its partners towards the SWAp process in the education sector. An additional factor that drove them to take a practical step towards SWAp was an alliance of like-minded donor agencies, and substantial technical backup by an ADB TA team.

Donor funding to the education sector for the period between 2001 and 2007 is estimated at US$ 321 million, with US$ 39 million (actually spent) in 2001, US$ 45 million (actually spent) in 2002, US$ 45 million (estimated) in 2003, and US$ 193 million (projected) for 2004-07. Funding by the two largest donors, ADB and World Bank, accounts for 38% of the total expected amount in 2003. Other large donors include UNICEF, JICA, EC and WFP.

Aid coordination is a key component of the SWAp process (though it does not fully represent SWAp). This section therefore attempts to present mechanisms of aid coordination in the context of the education SWAp.

The definition of SWAp was revisited in the donor report for 2003 ³¹ with the recognition that, "…the concept of, and more importantly the practice of implementing SWAp is not and cannot be uniformly prescribed. Rather the approach evolves over time and the pace and depth of the transition towards a ‘pure’ SWAp is dependent upon highly context specific factors."

Key milestones of the SWAp process to date are highlighted in the table below. The SWAp process can be divided into three stages: commitment to partnership, sector policy and strategy formulation, and joint sector review.

Prior to 1999, interactions among donor agencies remained at the level of consultation and information sharing, mostly through personal communications and ad hoc groupings or gatherings. There was no agreed framework to bring donors to work in partnership with the government.

As the first step in formalizing a new partnership for the development of education in Cambodia, donors and NGOs signed a Statement of Intent (SOI) in March 2000. ADB was reportedly the primary agency that facilitated this process with the aim of initiating a SWAp in the education sector. The SOI could not receive endorsement by all invited organizations, however. Nine of the agencies invited to sign did so, but five donors (USAID, French Cooperation, GTZ, JICA and EU) kept their endorsement pending. The reasons for not signing may have differed among the donors, but some interviewees speculated that they might include concerns about the constraints the SOI might impose on future assistance, e.g. conditions that conflict with donor countries’ own foreign assistance procedures and policies. In addition, the partial support to the SOI implies that the process to carry forward its endorsement may not necessarily have paid full attention to obtaining consensus from all those concerned.

To address these concerns, the government made clear that it was taking an inclusive approach to SWAp and had no intention of excluding any donors from the SWAp process. The Minister of Economic and Finance, for example, made a statement at a ministerial meeting in October 2000 that excluding any donor agency from the SWAp process would not benefit the country. In addition, the Minister of Education encouraged donor agencies which intended to assist Cambodia through project-type support to participate in the SWAp process at the Government/Donor/NGO Consultative Meeting (the ‘Consultative Meeting’ hereinafter) in November 2000.

Later in February 2001, the Consultative Meeting approved a document "Principles and Practices for Partnerships," which clarified the objectives and scope of SWAp and the ways in which partners would engage and cooperate. Its adoption did not take the form of a written endorsement by all the donors, but it helped establish common understanding of SWAp and nurture the spirit of partnership and cooperation of donors in the sector. In this way, the "Principles and Practices for Partnership" laid the groundwork for the establishment of the Donor Education Sector Working Group (ESWG) during the subsequent stages of partnership development.

MOEYS took another step to formalize the education reform planning and implementation process in early 2001. The Education Strategic Plan (ESP) 2001-05 was developed with technical and financial support of the ADB, and in consultation with donors and NGOs, and was approved in April 2001.

The ESP summarizes the phasing of priority education policy and strategy reforms for the next five years. The process leading to the final ESP document also involved internal consultations within MOEYS through four policy task forces,³⁴ as well as with MEF and MOP. In conjunction with the ESP document, the Education Sector Support Program (ESSP) 2001-05 was developed to consolidate the priority recurrent and capital programs identified by MOEYS for implementing and achieving the medium-term policy and strategy objectives defined in the ESP. The ESSP development process involved 14 different working groups within MOEYS. The process of consultation with internal and external stakeholders throughout the ESP/ESSP development was coordinated by the Planning Department of MOEYS.

The joint review and appraisal of the ESP/ESSP 2001-05 took place in June 2001. It involved working group sessions with each of the three coordination teams and five appraisal teams. The process of integrating outputs of all the teams was as follows: (1) each appraisal team held group sessions; (2) outputs from the appraisal teams sessions were assembled by two coordination teams (the Sector Management Coordination Team and the Program Development Coordination Team); and (3) the assembled results were integrated by the Appraisal and Review Coordination Team. Each team typically involved a mixture of officials from MOEYS and other Ministries and external partners. An overall coordinating committee of senior policy staff from the Ministry, donors and the NGOs was responsible for final negotiation of the appraisal. This process was supported by a Secretariat located in the Planning Department and financed and staffed by a number of donors.

An Education Round Table session was organized to conclude the appraisal process during the last part of the joint review. Senior members of the government and representatives of the donors and NGOs presented their responses to the ESSP. The appraisal results were incorporated into the final version of the ESSP 2001-2005 document, and reflected in the subsequent detailed implementation planning of MOEYS for 2002.

Since the 2001 ESSP appraisal, MOEYS in collaboration with its partners has undertaken two joint ESSP Reviews, one in September 2002 and one in May 2003. Currently the ESSP is being revised based on the last ESSP Review, under which a new budget is being negotiated for approval. The ESWG and the Consultative Meetings have fed critical inputs into the preparation process of the joint ESSP Reviews. A donor coordination advisor has also played a critical role in liaising between different stakeholders and forums.

Similarly to the 2001 appraisal, the joint reviews of ESSP in 2002 and 2003 involved a series of team working exercises involving various stakeholders. The team organization under the 2003 ESSP Review is summarized in Table 6-4.

Source: Education Sector Joint Review Report 2003.

In addition to the review team meetings, a special meeting of the Education Finance Management Committee (EFMC) was convened to address critical financial issues, in particular the core policy matrix, education sector financial performance and Priority Action Programs (PAPs) implementation. The PAPs issue is revisited in a later section in connection with the discussion of direct budget support to the education sector.

The institutions that played important roles in the process of Education SWAp include a mixture of (1) joint working frameworks; (2) aid coordination tools; and (3) intra-donor coordination. Table 6-5 summarizes the institutions involved in the SWAp process.

The ESWG was established as a sub-group of the Social Sector Working Group in the spirit of Partnership Principles in 2001. The Terms of Reference formally adopted in late 2001 spelled out the aims of ESWG including:

• Advancement of education in Cambodia

• Establishment of linkages with the Government especially through MOEYS

• Monitoring education reform and development in Cambodia

• Co-ordination of donors working in the education sector in Cambodia.

The ESWG has played a role in coordinating donor assistance in the education sector, and in promoting a common and integrated program approach. It has served as the principal formal mechanism for donors to discuss policy, strategy and implementation issues related to the ESP/ESSP. It has also served as a forum for donors to exchange information on plans and status of implementation of their programs in the education sector. The working group has been chaired by the Representative of UNESCO, which also provides secretarial services and works closely with the donor coordination advisor. The ESWG meets approximately once a month with typically 20 members attending each meeting.

The Government/Donor/NGO Consultative Meeting has been organized on a regular basis since the Appraisal of ESP/ESSP in 2001. Chaired by the Minister, it is attended by senior officials including Secretary of States, Director Generals and other senior officials at MOEYS, donor representatives and NGO representatives. The Planning Department serves as the secretariat for the Consultative Meeting. It meets regularly once every two months to share information on the implementation status of ESSP, formally ratify major policy documents and statements, and agree on strategic directions for the sector. The Chairpersons of the ESWG and NEP (discussed below) present the collective views of their respective constituencies.

The Common Policy Implementation Matrix was initially developed as part of an agreement between the government and ADB as a budget support component in its policy adjustment loan program. The donors subsequently accepted the Ministry’s request to jointly expand the matrix to cover the whole sector. It provides a framework for policy-based strategic negotiation, planning and monitoring covering the whole sector. It serves as a critical reference point against which funding agreements between agencies and the government are negotiated in the medium term. A matching Indicators Matrix was also developed and now provides national level indicators against which to measure expected outcomes.

The NGO Education Partnership (NEP), established in 2001, promotes the discussion and exchange of ideas between education NGOs and MOEYS. The NEP has successfully facilitated a more coordinated approach to the work of NGOs within the context of the ESSP and the sector wide approach. It provides support for the development of the education sector in a variety of ways, including inputs to specific initiatives and mechanisms (e.g. the EFA National Plan, ESSP Reviews, the ESWG, the CG and the Consultative Meeting), and operational research. The ESWG recognises and appreciates the critical role played by NEP within the education partnership approach in Cambodia.

The donor coordination advisor has been serving over the past few years to underpin the process of aid coordination during critical times, in particular during the preparation of the ESSP Reviews. The primary objectives of this position are to strengthen the capacity of the donor community to provide timely, well-coordinated and professional responses to the ESP/ESSP and to facilitate discussion among donors on education policy, strategy and program priorities and targets. The advisor has been based in the UNICEF Education Section, works extensively with the Planning Department at MOEYS and provides advice to the chairperson of the ESWG.

The modalities of donor financing to the education sector can be divided into (1) direct project support; (2) direct budget support; (3) off-budget support to the Ministry; (4) indirect support through NGOs; and (5) direct agency support. Definitions of each modality are summarized in Box 6-2. Of the total financial inputs to the education sector committed by donors in 2003, US$ 25 million or 57% is provided in the form of direct project support and US$ 8 million or 18% is in direct budget support.

Table 6-6. Inputs to the sector by funding modality (US$)

Source: Education Sector Donor Report (2002) and Cambodia Education Sector Donor Report (2003).

The PAP is the government’s innovative budgeting scheme introduced to the education and health sectors in 2000. The PAP was intended to ensure that: (a) specific activities gain access to their full budget allocation by removing PAP funding from the discretionary cash allotment system; (b) introducing budget management centers (BMCs) at provincial and district levels, which manage their own budgets in accordance with pre-approved plans; (c) replacing pre-audit of spending actions by post-audit; and (d) creating dedicated accounts in provincial treasuries offices which are not subject to treasury discretions about cash release.³⁶ The PAP was piloted in 10 provinces in 2000, followed by a nation-wide operation in Education from 2001 onward.

The current system for distribution of the PAP funds to provinces involves transfers of money from the National Treasury to Provincial Treasuries and then on to the Provincial Budget Management Centers (BMCs). The money received at the provincial BMCs is then sent to institutions directly or to schools via district BMCs (Chart 6-1). All PAP funds are sent and received in cash. So far, the Ministry has experienced difficulties in securing the release of funds for PAP implementation. At the time of the Joint ESSP Review 2003, only 50 % (59% for provincial BMCs and 34% for central BMCs) of the total PAP 2002 cash had been released from the National and Provincial Treasuries.

A significant portion of the direct project support funds comes from the ADB, AusAID, French Cooperation, JICA, UNICEF/Sida and the World Bank. The majority of the projects are resourced in the form of grants, and the rest are supported through loans. Disbursement, accounting, auditing and reporting procedures differ between projects depending on donors’ policies. This type of assistance is included in the education Public Investment Program (PIP) (Chart 6-2). Future financing plans of donors are reflected in the three year rolling education medium term expenditure plan (MTEP) that is to be integrated with the government’s MTEF.

To what extent has a shift from donorship to partnership, and eventually to ownership, has been achieved since SWAp was launched in education sector? It is difficult to assess this shift in an objective, quantitative manner, but many of the observers interviewed in the course of this study felt that government ownership had definitely been enhanced. The new arrangements for aid coordination and the new opportunities for collaborative work with donors have resulted in a high level of commitment from MOEYS. Several donor representatives told the study team that the Minister, Secretaries of State and Director Generals have all been present at the regular Consultative Meetings and are actively involved in determining major policy directions.

The fact that MOEYS now has a mechanism for directing donors to align assistance with the sector’s needs has also encouraged MOEYS to take a more active role. Several donor representatives reported with appreciation that they are increasingly having consultations with MOEYS officials over their development assistance plans. Technical advisors based at MOEYS also noted that their work is increasingly supervised by MOEYS. Other informants felt that the government’s increased sense of ownership was apparent in the way that MOEYS now addresses problems facing the education sector. For example, in response to the delayed PAP disbursements, the Minister of Education officially acknowledged the issue at the ESSP Joint Review 2003, and committed to address the problem in collaboration with MEF.

A number of donor advisors share the view that the process of working with donors to coordinate aid has in itself improved the capacity of MOEYS officials. For example, according to those participating in the ESSP Joint Reviews over the past two years, government officials participated more actively during the 2003 review than they did in 2002, and even led group sessions. Some government officials also made the same point. A senior official of MOEYS, during an interview by the study team, said that the SWAp process to date has succeeded in building leadership of MOEYS. In particular, he stressed that the series of workshops on SWAp at an early stage had significantly helped MOEYS to deepen its understanding and eventually build confidence in taking it up as a Ministry’s approach. This improved confidence, in turn, has led to the strong leadership demonstrated by MOEYS at later stages of SWAp.

Another example of increased government capacity has to do with how documents are drafted. In the past, a number of official documents of MOEYS were reportedly drafted in English first with significant assistance by foreign advisors, then translated into Khmer. However, both government officials and donor representatives stated that the recent drafting of the National Plan for EFA 2015 was conducted primarily by government officials with limited assistance from foreign advisors.

A number of donor-funded technical advisors have been assigned to the education sector, especially since the beginning of the SWAp process. There is no doubt that their assistance has contributed to the above-mentioned progress of the reforms as well as capacity development of MOEYS to manage its programs/projects. However, several MOEYS officials working at the operational level felt that technical advisors’ roles should have much sharper focus on the transfer of skills to MOEYS officials than is currently the practice. They observed that in many cases donor advisors spend a large portion of time carrying out the tasks of officials. It was also reported that the work of technical advisors does not always build on the earlier work done by his or her predecessors and often lacked connection with other foreign assistance. These issues concerned with technical assistance will be further discussed in the later section as part of the challenge in providing more effective and efficient support of capacity development.

This could suggest that a target setting driven by donors and without sufficient assessment cannot mobilize support by other stakeholders. Currently, budget support by ADB is targeted to the recurrent budget through PAP. The direct impact of the budget support, e.g. improvement of enrollment rate, has been reported in various occasions, but its effectiveness in institutional development in a sustainable way has yet to be seen.

UNICEF/Sida has been operating a technical assistance project to address the capacity gaps in PAP management at the provincial levels. The Education Quality Improvement Project (EQIP) financed by World Bank has also supported a participatory planning process at school clusters in three provinces and proved to be effective in complementing the PAP implementation. These are examples of good practices in which the advantages of different donor assistance modalities have been combined to address capacity and investment gaps identified in the sector.

Both MOEYS and ESWG recognize that the capacity of donors in understanding and engaging in the SWAp process has improved since its introduction. Nevertheless, a critical issue in this respect is the capacity of donors in dealing with the growing number of tasks required for aid coordination. Some donor advisors felt overwhelmed by the volume of administrative tasks resulting from the increased number of steps before consultation with MOEYS. A lesson from the experience of MOEYS and donors, as earlier mentioned, is that the reduction of the government’s costs for donor coordination are achieved in part by increasing the donors’ transaction costs. The study team received the impression that most of the donors do not appreciate the increase in their administrative burden; however, in consideration of the primary purpose of reducing MOEYS’s cost, donors may have to accept the increased costs as well as to consider increasing their capacity to contribute to aid coordination.

The donor report for ESSP 2003 suggests several ways to enhance donor capacity, including complementary ad hoc workshops, seminars and discussion sessions on technical and strategic issues targeting donors.⁴⁶ In the past, a number of initiatives have been undertaken, including a workshop on budget support in 2002. It is expected that donors will obtain further understanding on strategic issues in this way; for example, through technical briefings by MOEYS technical advisors. The donor report also recognizes that a vast amount of information on aid management exists and it is difficult to know what will be potentially useful. In this respect, the report suggests that donors consider the establishment of a small document or information center, incorporating key information on the ESP/ESSP, donor policies/strategies and wider education and aid management information.