The National Assembly on Monday began discussing a proposed budget of over $700 million for 2003, amid complaints from the opposition that most tax revenue ends up in officials’ pockets instead of government coffers.
The proposed budget, drafted by the Ministry of Economy and Finance, increases allocations to the social sector, according to the government’s planned economic reforms, Finance Minister Keat Chhon told the Assembly.
The budget sets total expenditures at 2.83 trillion riel (about $707 million). Last year’s budget allocated $687 million.
“This budget focuses on the social sector and increasing democracy,” he said. The idea, he said, is to “strengthen the basics to jump start prosperity.”
The ministries receiving the most funding in the proposed budget are, in descending order, Education, Defense, Health and Interior. All are scheduled to increase from last year.
Education spending is set to increase from this year’s $72 million allocation to $81 million next year, a 13 percent increase. Defense is to go from $64 million to $67 million, a 5 percent increase. Health allocations should rise from $43 million to $51 million, a 19 percent increase. The Ministry of Interior, which includes all the country’s police forces, is to get $40 million, up from $34 million last year, an 18 percent increase.
However, allocations on paper seldom match the real distribution of money. A Finance Ministry document for the first 10 months of this year reveals that the Council of Ministers and the Finance Ministry have already overspent their allocations, while the Health Ministry has received just 45 percent of its budget.
On the floor of the Assembly on Monday, opposition lawmaker Son Chhay blasted the government’s revenue projections, saying much more could be collected if officials weren’t so corrupt.
Projected revenues for petroleum taxes, he noted, are lower for 2003 than they were in 1994, despite the huge number of cars and other gasoline-powered machines that have entered the country since then.
“Why have the tax revenues not increased?” he said. “This is a huge loss.”
He estimated that $100 million more in petroleum taxes could have been collected in 2002.
He also pointed out that the government seldom collects as much as it plans to. In the first 10 months of 2002, according to a Finance Ministry document, only 51 percent of the year’s projected $44 million in petroleum taxes was collected.
Likewise, according to the document, only 45 percent of civil aviation revenues—projected at $10 million—was collected.
Son Chhay also claimed that tourism revenues from Angkor ticket sales are being skimmed. Only about $4 million has been collected this year, he noted—down from $8 million collected last year. “The government claims that more and more tourists are coming to Cambodia, more and more flights are coming to Cambodia. So why is the revenue decreasing?”
He also claimed that Cambodia owes $1.5 billion to donor countries and international agencies—not counting $1.2 billion loaned by the then-Soviet Union in the 1980s. “The younger generation will have to pay the debts incurred by their elders,” he warned.
