IFAD

Planning: For the core support component of Seila, aid coordination at the planning stage was carried out through the program extension process as shown in Table 8-6.

Implementation: UNDP, DFID and Sida provide joint funding to PLG, which supports Seila activities by: (1) providing technical and policy advisory services, (2) contributing to Seila’s operating costs, and (3) providing funding for Seila’s investment activities. UNDP is responsible for administering PLG.

Monitoring and Evaluation: Besides Seila’s annual working plan and progress report, PLG also issues its own annual working plan and progress report. Donors carry out joint monitoring excercises for PLG through the Permanent Advisory Team (PAT) and Tripartite Project Review (TPR). The PAT visits Cambodia two to three times per year to carry out strategic monitoring of the program, with funding from DFID and Sida. The TPR is held annually, and all the parties concerned are invited to participate.

Planning: The Seila Forum is an institution designed to develop partnerships with other donor agencies for programs and projects under Seila. It meets twice a year, normally July and December, and all donors interested in Seila are invited. In this meeting, STF presents the achievements of the program and proposes an action plan for the coming year. Based on the proposed plan, donors express their interest in the program and/or its specific components, negotiate with STF Secretariat about partnership arrangements, and pledge their support.

Implementation: There are a variety of partnership arrangements with Seila, as Seila accommodates a wide range of sector or area-specific programs and projects, responding to the preferences and comparative advantages of different donors who accept the Seila’s reform framework.

Monitoring and Evaluation: Seila’s annual work plan and progress reports are submitted to respective partners. Seila also provides supplementary reports to partners on a request basis. Respective donor agencies are also required to monitor and evaluate their own programs or projects. Loan or credit programs under Seila, such as IFAD and World Bank (from 2003), carry out supervision missions on a regular basis.

The government’s decision to expand the geographic coverage of Seila program demonstrates clearly its ownership of the program. As was mentioned earlier, the original plan in Seila Program Document 2001-2005 was to expand its coverage from 6 provinces to 17 provinces by the end of 2005. However, the government revised the plan to move even faster and succeeded in covering all 24 provinces in early 2003.

Perhaps more importantly, government ownership is demonstrated by the steadily increasing allocation of national budget funds to Seila in recent years. Indeed, the national budget for Seila was raised by 78% from $6.0 million in 2002 to $10.7 million in 2003. This rate of increase is higher than the increase in foreign assistance to Seila.

The transfer of signing authority of partnership agreements from foreign to Cambodian hands at STF Secretariat also indicates enhanced local ownership. The UNDP used to sign partnership agreements with donor agencies who accepted the Seila framework until 1998. Currently, the Secretary-General of the STF Secretariat signs partnership arrangements with donors as the representative of the Program. This clearly indicates that the government now assumes more responsibility for Seila.

There are some clear indications that the government has gained capacity to manage Seila and to coordinate external assistance since Seila started.

First, the number of external advisers for the STF Secretariat has been reduced from 40 during 1996-2000 to 6 after 2001. By contrast, the number of national staff increased from less than 5 to 30 during the same period. As Seila expanded its geographic coverage during that period, this indicates that the STF Secretariat as a whole has enhanced its capacity to manage the Program over time.

Second, the STF Secretariat also seems to have enhanced its capacity to coordinate foreign aid. The fact that an increasing number of donors are willing to channel funds through Seila clearly indicates that donors are increasingly confident about the capacity of STF Secretariat as a coordination body even though the number of external advisors has been reduced.

Finally, Seila’s capacity for aid coordination at the provincial level have been enhanced through the establishment and operation of District Integration Workshops (DIWs) in the last few years. This is discussed in greater detail in the next section.

Seila’s DIWs have reduced the overlap of donor assistance at the provincial and commune levels. The DIWs provide an opportunity to share information and coordinate the commune level investment plans among commune councils, line ministry departments, NGOs, and donor agencies. In 2002, 144 DIWs which involve 1,283 communes were held, and total 8,880 priority activities proposed by Commune Councils have received support from departments, NGOs and donor agencies (NGOs and donor agencies supported 2,944 activities among the total 8,880 activities). In addition to the priority activities, the departments, NGOs and donor agencies agreed to support a total of 13,347 activities for Commune Councils.⁶⁸

The Seila framework also appears to have contributed to reducing transaction costs to the donor agencies that provide services and infrastructure to the commune level. A number of donors use Seila’s local planning, implementation and monitoring and evaluation system. This avoids using different development procedures and/or duplicate development procedures at the commune level and helps to reduce transaction costs to both local administration and donors.

All the evidence discussed above seems to indicate that Seila has become increasingly sustainable since it started in 1996, both in terms of the project itself and in terms of the government’s ability to manage aid. The government has demonstrated increasing ownership of the Program through active leadership and financial commitments. It has also made a notable progress in enhancing institutional and human resource capacities of the STF Secretariat. These achievements may be attributable in part to the long-term partnership between the government and donors supporting this program.

Since 1996, Carere2/Seila put enormous effort into persuading Seila partners (the government, donors, NGOs, civil society of the value of the Seila strategy and systems and the benefits of partnership through program implementation. After three to four years of planning, implementation and capacity building, with resources provided almost entirely through CARERE2, STF (the government) recognized what Seila has to offer to development partners interested in financing local development and actively pursued the partnership approach.⁶⁹

Those partnership arrangements span from those that use only Seila’s planning and service delivery system at the commune level (e.g., UNICEF and WFP) to those that provide technical assistance and loans (e.g., AusAID/CAAEP). Together with the other benefits of the Seila framework, this flexibility has helped to mobilize an increasing amount of external resources under the Seila framework over the time. Although this practice has incurred heavy management costs for Seila, this management cost has been well worth it when the amount of external resources mobilized and the benefits provided to local people are considered.

As was mentioned in section 2, Seila’s DIWs offer a forum for dialogue and coordination across sectors (horizontal), between line departments and commune councils (vertical), and with external partners such as NGOs and donor agencies. They have nurtured information sharing, cooperation and mutual understanding at provincial and commune level. The presence of this effective forum contributed to increasing trust and enhancing partnerships between the government and donors.

Manageable numbers and clear definition of roles of participating donors helps reduce management costs.

Only three donors, who have partnership experience and share common views on partnership, are involved in the core support component of the program, PLG. This has made coordination easy. UNDP executes the PLG operation, and DFID and Sida contribute funds to through trust fund agreements with UNDP. The latter two donors send a joint Permanent Advisory Team to monitor the PLG on a regular basis. This arrangement reduces transaction costs for the government, as does the simple and clear definition of roles of participating donors.

Further enhancing Seila’s provincial level coordination of development

Seila offers effective mechanisms for provincial level coordination on local development through District Integration Workshops, which have been held in all provinces annually. However, it was reported that line department’s activities often do not meet Communes’ requests, and NGO participation to the DIW is limited in some areas.⁷⁰ For example, during the DIW the team participated in November 2003, only five departments (Social Affairs, Education, Rural Development, Women’s Affairs, and Health) and three NGOs were present at the meeting. According to the PLG advisor interviewed, there are other NGOs working in that district. Therefore, further effort is needed to involve a wider range of stakeholders at provincial level.

In addition to DIWs, there also appear to be a number of other mechanisms (meetings, forums etc.) of coordination which are independently organized by different line departments and other organizations, for instance Provincial Coordination Committee (ProCoCom) in Health. There might be a need to review those existing arrangements and consider options to further enhance and rationalize, if needed, aid coordination at the provincial level. However, before the existing arrangements are reviewed, the roles and functions of provincial and district administration need to be clearly defined. This points to the necessity of adopting an Organic Law, which is discussed in the next section.

Creating a unified structure for local development

Seila successfully introduced participatory mechanisms to deliver services and infrastructure at the provincial and commune levels. It also expanded its geographic coverage in a relatively short period of time. However, despite its success, the criticism has been made that Seila has created a structure which is parallel with the existing administrative structure for local development. It is argued that this parallel structure should be integrated into a unified structure that provincial governments and ministries can operate through, without losing the strengths and capabilities that Seila has developed.

While many informants agree that this is a valid point, there appears to be no agreed strategy as to how Seila could be integrated into the regular administrative structure. Some argue that the integration should take place as soon as possible because donors’ resources should be directed to strengthening the regular administrative structure. However, a counter argument is that, given the weakness of the regular administrative structure, Seila’s effective service delivery system should continue to be used to improve the livelihood of local people until the regular structure becomes more effective. Another argument is that even though commune councils are elected, provincial governors and district chiefs are appointed by the central government and that true decentralization is unlikely to succeed without the election of provincial and district administration. As such, there are considerable differences of opinion as to how decentralization strategy and programs should be implemented in the future.

One of the underlying problems appears to be the lack of clear definitions of the roles and functions of provincial and district administration at the moment. Currently, Seila is applying its management systems, which has been developed through leaning by doing, for provincial and district administration. It was suggested that the government prepare and adopt an Organic Law that defines the roles and functions of provincial and district administration, building on the experience of Seila. The presence of the new Law will help clarify the roles of Seila, and establish a unified structure for local governance and development in the future.

Issue of salary supplements

The Seila staff mostly consists of seconded staff from line ministries and, as in many other donor-funded projects in Cambodia, they are paid salary supplements. It is clear that salary supplements provided an important incentive for them to do their work properly and deliver outputs as intended.

A challenge of integrating Seila into the regular administrative structure would be to ensure levels of salaries that can motivate staff to work properly. Some informants were seriously concerned that staff members might lose their incentive to work and that the Seila system would not function if integration takes place without a change in civil service pay. The government and donor agencies need to consider seeking a joint strategy to address this problem within the broader context of national civil and administrative reform.

Capacity building in public financial management

Capacity building in public financial management is a priority, particularly for the process of transferring C/S Funds to the provincial treasuries.⁷³ During the Seila/CARERE2 period, UNDP funds for provinces were transferred directly to a bank account managed by the PRDC ExCom. Since the election of commune councils, the C/S Funds have been transferred from the National Treasury to provincial treasuries under the Ministry of Economy and Finance.

While this action is seen as an opportunity to strengthen the treasury systems in the government, disbursement of C/S Funds has been considerably delayed in many provinces. For instance, the Commune Fund is intended to be transferred according to the following schedule: 50% in March, 30% in June and 20% in September. According to one ExCom advisor interviewed in Kampong Speu province, only 20% of the allocated budget had been disbursed at the time of the interview (June). In Prey Veng province, which the study team visited in October, only 48% of the allocated budgets had been disbursed. Some observers also raised the question as to whether disbursement of C/S Funds would be handled properly after the PLG advisors leave.

In addition, commune councils need further support for capacity building, especially to enhance capacity for accounting and financial management. According to the LAU staff interviewed at Prey Veng Province, the capacity of commune councils varies depending on the communes, but their basic knowledge of local administration and management is generally very low. Commune councilors need more time and support for gaining experience, skills, and knowledge to manage commune council activities by themselves. Also, the FU staff interviewed reported that the capacity of commune clerks was extremely low and they needed more training.