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Logo of Phnom Penh Post newspaper Phnom Penh Post - Disquiet on funding

Disquiet on funding

THE UN's model decentralization program in Cambodia, known as the Seila Task

Force (STF), has come into conflict with some government ministries over issues

ranging from execution of rural development projects to financing of commune

councils.

The matters reached such a pass recently that Prime Minister

Hun Sen intervened in one clash between STF and the Ministry of Rural

Development (MRD) over a $30 million donor-funded northwest rural development

project. Hun Sen selected the ministry to run the project amid STF complaints

that it might not be "in line with the kingdom's [overall] decentralization

efforts".

"Seventy per cent of the project comprised building rural roads

over which there was no conflict. The differences concerned only the community

development component," said an STF source, adding that STF felt its model was

better suited.

In a separate incident, the Ministry of the Interior (MoI)

complained that STF had cornered "two-thirds of the $6.4 million Commune Fund

for 2002" for the 506 communes it will support.

The function of the

Commune Fund, which was set up by the Ministry of Economy and Finance with $5

million of government money and the balance from donors, is to support commune

councils in their first year of operation.

The MoI was annoyed that the

majority of the cash would go to only one third of the country's commune

councils.

The fund will provide each commune with around $1,400 to meet

administrative expenses, depending on population size and poverty indicators.

However, each of the STF-supported communes will be given an additional $8,400

for development.

"That translates into almost $5 million to the 506 Seila

communes alone. Does that mean the other 1,115 communes will not require any

development in the first year of their functioning?" complained a senior

ministry official. "Giving them such a big share at the cost of others is not

fair."

Scott Leiper, head of STF, said that communes should not be seen

as Seila and non-Seila entities.

"Seila only mobilizes resources [for the

communes supported by it] and transfers them to the executing agencies at the

provincial, district or commune level, while monitoring implementation of the

contracts," he said.

Leiper said the sole reason why Seila-supported

communes garnered additional development grants was that they alone submitted

the development budgets prepared by the Commune Development Committees (CDC) in

consultation with local villagers.

Leng Vy, chief of the newly

established Department of Local Administration (Dola) in the MoI, admitted

serious differences had cropped up during Dola's last meeting over funding of

communes, but said the matter was being resolved at the highest level. Since the

government had agreed to STF's five year (2001-2005) development plan, it could

not jeopardize development in those communes, he said.

"Eventually, both

[STF and Dola] have to be integrated and brought under the government's overall

plan for decentralization," he said.

Dola, which was set up by the MoI

in July to help implement the commune administration law, is also responsible

for implementing the decentralization process and is, therefore, the

government's focal point for all such efforts. Observers said the MoI felt STF

was creating a parallel system competing against Dola communes before they had a

chance to attain the same level.

The new commune councils will have three

sources of finance. Government revenues will be the most important initial

source of funding, allocated through the Ministry of Economy and Finance (MEF).

Raising local taxes and funding for specific projects, such as schools, would

come later.

Dola's Vy told the Post it wanted between 3 and 5 percent of

the national budget, but said the MEF has committed to only 2 percent thus

far.

"We need to draft laws to enable communes to collect local taxes

[like property tax], but that's a long, drawn-out process. Possibly by 2005

communes will be able to adopt their own revenue generating models to become

self-sufficient," Vy said.

Until then the third source of funding will be

funding for specific projects from government agencies and ministries,

particularly the Ministry of Rural Development.

The most pressing need

before the National Committee for the Support of Communes (NCSC) is to finalize

training material and schedules for the training of councilors and staff. Since

they will have different backgrounds and levels of education, devising material

to serve them will be a tough task, said Dola.

"By the year-end we plan

to hold a round-table liaison meeting with NGOs working in the field of

decentralization to finalize the training schedule," he said.

By the end

of November NCSC will have held its fifth meeting to help prepare its commune

development plan. Another problem to be resolved is that commune law states that

all commune councils must have finalized and adopted internal rules for

operation before they can start their tasks.

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