Donors Ponder Response on Civil-Servant Bonuses Suspended

Almost a month after the government partly relented on a controversial decision to end bonuses for civil servants working on do­nor-funded projects, the future of these payments is still shrouded in uncertainty.

But one thing is clear: The government’s development partners have stopped paying out these incentives because of the confusion, while civil servants say they have been forced to absorb sharp cuts to their most recent paychecks.

Meanwhile, donors are still in the process of responding to the government’s latest position on the issue, a Jan 21 letter from Finance Minister Keat Chhon allowing them to continue paying some bonuses—also known as salary supplements—while the government pursues long-term civil service reform.

Putu Kamayana, country director for the Asian Development Bank, said on Wednesday that the government’s development part­ners were preparing a joint letter that would request a face-to-face meeting with officials to seek clarity about the government’s position.

“It is not very clear, and that’s why we need to have a meeting about it,” Mr Kamayana said.

“It can be interpreted in many ways, so we want to have a discussion to be clear on what they intend and what would be acceptable to everyone so as not to disrupt any of these important programs that we are supporting.”

ADB has currently suspended supplements, and Mr Kamayana said he believed the government’s other development partners had too.

“Certainly that’s our position, and that is the position of other donors as I recall.”

A senior civil servant speaking on condition of anonymity due to the sensitivity of the topic said that all donors had stopped paying bonuses since an early December sub-decree banning them, despite the fact that the ban did not go into effect until Jan 1.

Many government workers bolster their low incomes with these incentives, which reward government workers involved with key aid projects. The civil servant said he and his colleagues were in severe economic distress without them.

“The matter is that donors have decided to temporarily halt the salary payments because they claim they don’t clearly understand the meaning of the letter and the type of reforming salary supplements the government has in mind.”

The civil servant, who is in charge of four major donor-funded projects, said that “hundreds” of civil servants at his ministry alone are affected by the bonus freeze.

“It has a terrible impact on civil servants, and I have received a lot of complaints from officials about their family economics,” he said.

“We are really concerned and hoping that donors will meet with the government soon.”

A female civil servant who requested anonymity for the same reason said she too had not received a bonus for working on donor-funded projects since December.

“Since the government decision, I have not been paid yet,” she said. “I earn very little but the salary supplements from donors helped my family a lot.”

The ban on salary supplements took the international aid community by surprise and caused an outcry, with donors and NGOs saying it could lead to a crisis in the public sector.

The ban even jettisoned major 2005 pay reforms known as Merit-Based Performance Incentives and Priority Mission Groups, which were standardized and partly funded by the government.

In his January letter to development partners, Mr Chhon, the finance minister, restated the MBPI/PMG system was to be eliminated but allowed donors to pay ad hoc bonuses once again, and even to replace MBPI/PMGs with new bonuses, essentially reverting to the pre-reform status quo.

The donors have so far declined to do so.

Sin Somuny, the executive director of medical NGO Medicam, confirmed that donors had halted the payment of supplements because they found the government’s stance confusing.

“At the moment, nothing is clear, and that’s why the approach of development partners is to wait and see,” he said.

Mr Somuny was critical of this decision, saying he was angry that the situation had deteriorated to the point where civil servants in the health sector are barely being paid. He blamed donors for not taking advantage of the government’s softened stance.

“At first the government said all incentive schemes are terminated. Now they say, we’ll eliminate PMG/MBPI, but you can continue other salary incentive schemes until the new modality is developed. So that is a flexibility that we should move on,” he said. “Why are we now saying, ‘No no no, we don’t pay anything?’ Why wait? People need survival.”

However, Mr Somuny admitted that he, too, did not really understand the Jan 21 letter.

“I can’t really interpret it either,” he said.

Perhaps the most confusing part of the government’s proposal was the announcement of a stopgap scheme called “Daily Operational Cost,” which would seemingly function as a series of per diem payments for civil servants involved in certain projects.

However, the plan—referred to as a “new modality”—was couched in bureaucratic jargon and not thoroughly explained.

Government officials declined this week to comment at length about the bonus issue, with the Ministry of Finance referring questions to the Council of Ministers, and the Council of Ministers referring questions to the Ministry of Finance.

However, Hang Chuon Naron, secretary-general of the Ministry of Finance, reiterated yesterday that it would take at least six months for long-term reforms to be put into place.

“Basically what the government wants to do in the meantime, because people are working on projects, is to allow [donors] to continue incentives instead of giving salary supplements for the people working on the projects, [so] they are paid on a daily basis instead of a monthly basis,” he said, describing the proposed Daily Operational Cost measures. “How that is implemented I don’t know yet.”

Mr Chuon Naron said he did not know whether donors had actually paid out salary supplements through this or any other scheme in January.

Meanwhile, Mr Somuny said, civil servants are feeling the pinch and the lack of bonuses will soon start to affect the delivery of key health services.

“It will affect the poor, it will affect humanitarian aid, social service delivery. So why not focus on human life and then work on policy development?” he asked.

“It’s a deadlock now. It’s a game on both sides. Why play this unnecessary game that will have adverse impact on the poor and on people’s lives?”

 

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