Riots Force Finance Ministry to Overspend

Costs associated with the anti-Thai riots last year, including a $5.92 million payment to the government of Thailand, were largely responsible for the Finance Ministry spending nearly double its allocated budget amount in 2003, Minister of Finance Keat Chhon said recently.

“I am authorized by law to pay the Thais,” he said when shown a copy of the provisional 2003 budget implementation numbers.

The figures, which officials warned are preliminary and likely to change when more complete budget implementation numbers are presented in April, show that last year the Ministry of Finance spent a bit more than $25 million, or 199 percent of its earmarked amount.

A general spending breakdown in the figures shows that the ministry spent about $7.6 million under Chapter 31 of the 2003 Budget Law, which is labeled “Social Interventions.”

The ministry overspent its budgeted amount for social interventions last year—a mere $75,000—by more than 10,000 percent.

Last March, the government paid the Thais $5.92 million in compensation for the Thai Em­bassy, left in ruins by raging youths who torched and looted the building during the riots. Though Keat Chhon has said that money came from the government’s budget, both the Bangkok Post and the Far Eastern Econom­ic Review have alleged that two Cambodian casino moguls in Poipet—Kok Ahn and Pad Supapa—contributed to the compensation payment so the border would be reopened and Thais would flock to their casinos.

Neither could be reached for comment.

Small amounts of money, ranging from about $5,000 to $230,000, are budgeted under social interventions every year for each ministry, depending on its size. Ministers are supposed to use the money to help government employees in need and help victims in national emergencies.

But it is hard to track how the money is spent, ministry officials said, and some added that the money is simply a discretionary fund for ministers.

The government can give money to families of civil servants if a member has a child, gets sick, has a traffic accident, dies or becomes disabled, according to the 2003 budget law. It can also be used to support those affected by natural disasters, such as the floods in 2000, 2001 and 2002.

In addition, social interventions money is used to give a pension to retired officials, support employees that are asked to resign, for scholarships and to fund medals or other awards given to a “hero.”

Based on the 2003 provisional spending figures, and budget implementation figures from 2002, the Interior and Finance ministries appear to have freedom to spend whatever they want under social interventions.

In 2002, figures show, the Interior Ministry’s administration department spent about $1.9 million on social interventions—more than 400 percent of what it was allocated. That same year, the Finance Ministry spent more than $800,000 on social interventions, about 1,100 percent more than it was allocated.

No other ministry, in either 2002 or 2003, came close to spending what the Interior and Finance ministries spent on social interventions. Adding to the murkiness of the spending, senior officials in both ministries said they didn’t know what the money was used for.

“These kinds of things come from the prime minister and the Council of Ministers,” Kong Vibol, secretary of state at the Ministry of Finance, said in reference to the large amount spent by the Finance Ministry for social interventions.

Em Samnang, the new director of the Interior Ministry’s finance department, said he didn’t know why the Interior Ministry’s administration department spent more than $2.4 million on social interventions last year—more than 500 percent of its allocated amount. Dul Koeun, the director last year, did not answer repeated phone calls.

When contacted recently by phone, co-Minister of Interior Sar Kheng said the social interventions money went to pay sick officials, provide identity cards to the population and pay debt accumulated by the Ministry of Finance. He did not elaborate.

After the government decided in 2002 to issue new identity cards—which state a person’s name, place and date of birth, present address and facial marks—it wanted to charge about $1.75 for each card to pay for them, Interior Ministry spokesman Khieu Sopheak said this week.

“But the ministry believed that people may sell their chickens to get money to buy the card, so then it decided to pay for all the cards,” he said.

Khieu Sopheak added that he didn’t know how much the cards cost or how the ministry spent money allocated for social interventions.

“We never see evidence that money [for social interventions] is used to help people in need,” said opposition lawmaker Son Chhay. “There is no evidence that it’s used appropriately. It’s money that ministers can do whatever they want with.”

Some ministries use the money for social interventions in other ways.

If an employee isn’t performing up to speed, but there is no direct evidence that he should be terminated, the money can be used to “make some small motivation [to resign], maybe $100, $200,” said Kuyseang Te, director general of administration and finance at the Health Ministry. Last year, his ministry only spent about $6,000, or seven percent of its budgeted amount, for social interventions.

The amount of money spent for social interventions appears to be scant in ministries other than Interior and Finance because it’s not worth going through the red tape to get the money.

“If one request is small, we have to wait until we have more requests and a bigger amount of money before sending them to the Ministry of Finance,” said Nhem Khemara, director of the finance department at the Ministry of Tourism. “Fifty dollars might take a few months to come through.”

(Additional reporting by Kuch Naren and Corinne Purtill)

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