Gov’t Touts Reforms Before Donor Meeting

The topic of public administration reform typically peeks its head out in the run-up to the Consultative Group meetings, at which international donors pledge aid. This year is no exception.

Last week, in a two-day seminar that brought about 600 provincial officials and donor-country diplomats to the Hotel Inter Continen­tal, Prime Minister Hun Sen and Cabinet Minister Sok An unveiled a five-year plan to reform the civil service.

Businessmen, government officials and economists say the plan sounds good and would help improve the dismal investment climate, if implemented.

They also say they’ve heard it all before.

The plan, Hun Sen said, is to make the government function more like a large company that sees its citizens as clients.

“The state has to stay close to the people, be transparent, provide quality services and respond to people’s questions,” the premier said.

Though the government insists there has been significant pro­gress on public administration reform in the past few years, others say it has been extremely slow.

As most reports on administration reform note, the Khmer Rouge regime in the mid-1970s killed off most of the country’s educated members.

Though efforts were made during the Vietnamese occupation and the post-Untac days to re­build human resources, the bureaucracy still suffers from a shortage of people with high technical skills.

“Even though close to half of all aid flows since the early 1990s have been spent on technical assistance, government capacity remains low in part due to delays in public administration reform and insufficient transfer of knowledge,” said an International Mon­etary Fund country assessment issued last month.

Furthermore, the extremely low salaries paid to civil servants, usually about $20 to $30 per month, have become a major obstacle to the government’s plans to lure foreign investment into the country.

Mostly because of their low wages, “many civil servants appear to be exploiting opportunities to seek rents,” said a recent World Bank report on the investment climate. “This complicates the business environment and links progress to civil service reform.”

The government created a body called the Council of Administrative Reform in the late 1990s that took a census of all civil servants.

The census, completed in 2001, resulted in the elimination of about 9,000 “ghost civil servants” from the payroll.

In a speech last week, Sok An said the government has no plans to cut the civil service, which now comprises nearly 165,000 people, or about 1.4 percent of the population.

But to boost productivity, he said, hard-working employees will receive incentives such as higher salaries and a chance to study abroad.

The Cabinet minister also said that “major progress” on reforms has been made in recent years, primarily in the form of the Hu­man Resources Management Information System.

This computerized system has allowed the government to keep track of its civil servants, which is supposed to translate into more efficient human resource management.

But donors, who have made administration reform a priority issue at the last two CG meetings, have indicated that progress has been sluggish.

“There is some concern that [public administration reform] is donor-driven, that there appears to be a drain of skilled personnel from the public service to donor-funded projects or even NGOs, and that results are only attained by making extra payments to participants working on reform initiatives,” said a recent UNDP draft report posted on the Internet.

Donor countries are scheduled to meet later this month to coordinate their positions in advance of the next CG meeting in Decem­ber.

“It looks like the government seems to be on the right track for reforming,” one diplomat said this week. “But we’re still not certain how serious they are. It’s been said before.”

The average civil servant salary increased from $19.50 per month in October 2001 to $28.10 in May 2002, an increase of more than

40 percent. Sok An said in 2002 that the average salary was supposed to hit $51.50, a wage comparable to the private sector, by 2006.

But last week, the Cabinet minister said that the government would increase wages by 10 percent to 15 percent per year—which, at current levels, would put the average salary at about $37 by 2006.

Moreover, Sok An issued a ca­veat on increasing salaries, saying that “remuneration levels must be sustainable and [are] a function of the fiscal framework and thus of government revenues.”

Efforts to increase revenue have seen little results.

Fiscal revenue, currently at

10 to 11 percent of gross domestic product, “is hardly enough to even meet the basic priority spending needs,” the recent IMF report said.

An efficient, skilled bureaucracy is crucial if the country hopes to compete with other nations upon entering the World Trade Organization, said Sok Hach, director of the Economic Institute of Cambodia.

“I’m a little pessimistic about the future,” he said this week. “In general, capacity here is so weak. Progress on public administration reform has been very, very slow.”

Business leaders say the government must follow through on its reform plans or investors will stay away.

Foreign investment has de­clined steadily in the past five years and the garment industry—the country’s largest—may be threatened as the quota system expires for WTO members at year’s end.

“The government has to make investors trust them,” said Kong Triv, vice president of the Cam­bodia Chamber of Commerce. “If nothing changes, the new government will face big trouble.”

But some provincial officials who attended last week’s seminar doubted that things would change quickly in a top-down bu­reaucracy.

Despite the government’s much-touted decentralization policy, key decisions are still made in Phnom Penh, said Tep Nonnory, governor of Kandal province.

“How do we act as CEO if we don’t have money and power?” Tep Nonnory asked. “If we want to fire bad staff, we can’t do it.”


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