CAMBODIA     

Medium Term Expenditure Framework: How to Ensure
Budget-Policy Linkages

Second Cambodia Development Cooperation Forum

 

Dr. Hang Chuon Naron
Secretary General, Ministry of
Economy and Finance
4th December 2008

 

1. Good Framework for Budget-Policy
Linkages Has Been Established

National Strategy Development Plan/Rectangular Strategy
Growth, Employment, Equity, and Efficiency for Poverty reduction
тс
Sectoral Development Plan
Socio-economic development priorities (Education, Health, Agriculture, Water resource, Rural development, and physical infrastructure)

тс
Medium Term Expenditure Framework/Budget Strategy Plan
Multi-years budget plan

тс
Annual Budget
Single year budgeting

 

2. Medium Term Expenditure
Framework (MTEF)

  • MTEF has been introduced since 2000 and it was first developed for only some key priority ministries.

  • MTEF is a top down sectoral policy targets based on key macro indicator targets and is used to guide the annual budget plan.

  • Process, accuracy, and usefulness of MTEF still need to be improved

  • MTEF preparation process and participants roles and responsibilities should be defined clearly

  • MTEF is suffered from inaccurate of macro indicators forecasting

  • MTEF is suffered from lack or week of long term sectoral policy of some sectors

  • MTEF is only used as a reference document and has not become a guidelines

 

3. Budget Strategy Plan (BSP)

  • BSP has been introduced in 2007 aims at improving budget integration and comprehensiveness as well as serving as a bottom up multi year budgeting.

  • BSP is a 3 years rolling budgeting plan which requires all Line Ministries to present both recurrent and capital budget including all external financing from Development Partners.

  • BSP is being used by Budget Department as an inputs in preparing budget circulars and developing budget envelop for Ministries.

  • Good BSP will improve annual budgeting accuracy, effective and efficient budget allocation, and budget documents

 

4. MTEF and BSP

  • MTEF need to improve for continue to serve better as a top down sectoral envelop targets based on macro indicator targets to guide the annual budgeting plan.

  • BSP will continue to improve to serve as a bottom up multi years budget plan based on sectoral and ministerial strategy development plan and annual budget implementation.

  • MTEF and BSP will be consolidated and integrated into the budget at the annual budgeting process.

  • Good MTEF and BSP will improve budget policy linkages, annual budgeting accuracy, effective and efficient budget allocation, and budget documents.

 

NSDP Allocations and Annual
Budget (million USD)

Sector NSDP Allocations
2006-2010
Budget
2006
Budget
2007
Budget
2008
Budget
2009
Social Sector
  • Education

  • Health

1, 390
670
720
277
163
114
353
175
178
 
446
216
230
 
435
211
224
 
Economic Sector
  • Agriculture

  • Rural development

  • Water resources

  • Industry/Trade

1, 090
570
420

100
135
23
36
40
36
148
29
33
45
41
189
29
38
40
82
131
39
20
32
40

Infrastructure

  • Transportation

  • Post/Telecom

765
690
75
131
123
8
171
163
8

202
187
15

154
139
15
Services
  • Gender

  • Tourism

  • Environment

  • Community/Social

  • Culture and Arts

345
40
45
120
100
40
66
9
6
17
29
5
64
8
7
11
34
4
72
13
6
8
39
6
84
15
9
6
47
7

 

 

Thank You

 


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