Cambodia: Decentralized Public Service and Financial Management SP2(Decentralized Rural Infrastructure)

Sovereign Project | 41392-023

Summary

In 2012, the ADB Board granted approval of the Decentralized Public Service and Financial Management (DPSFM) Sector Development Program, including a project loan for $13.5 million and a $24 million policy-based loan for subprogram 1 of the programmatic approach. The DPSFM aims to assist improved access to and coverage of basic public services. This will be achieved through an efficient system of intergovernmental fiscal relations.

The DPSFM is structured along a series of policy actions in seven major reform areas:

a. Development and regular update of a gender-sensitive policy and regulatory framework for decentralization.

b. Establishment of institutions for efficient coordination of sub-national democratic development policies.

c. Definition of clear service delivery responsibilities of Sub-national Administrations (SNAs).

d. Assignment of efficient tax and non-tax revenue sources to SNAs.

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Procurement Documents

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Project Name Decentralized Public Service and Financial Management SP2(Decentralized Rural Infrastructure)
Project Number 41392-023
Country Cambodia
Project Status Proposed
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Loan: Decentralized Public Service and Financial Management SP2(Decentralized Rural Infrastructure)
Asian Development Fund US$ 25.00 million
Asian Development Fund US$ 10.00 million
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Knowledge solutions
Sector / Subsector Public sector management - Decentralization - Public expenditure and fiscal management
Gender Equity and Mainstreaming Effective gender mainstreaming
Description

In 2012, the ADB Board granted approval of the Decentralized Public Service and Financial Management (DPSFM) Sector Development Program, including a project loan for $13.5 million and a $24 million policy-based loan for subprogram 1 of the programmatic approach. The DPSFM aims to assist improved access to and coverage of basic public services. This will be achieved through an efficient system of intergovernmental fiscal relations.

The DPSFM is structured along a series of policy actions in seven major reform areas:

a. Development and regular update of a gender-sensitive policy and regulatory framework for decentralization.

b. Establishment of institutions for efficient coordination of sub-national democratic development policies.

c. Definition of clear service delivery responsibilities of Sub-national Administrations (SNAs).

d. Assignment of efficient tax and non-tax revenue sources to SNAs.

e. Implementation of fiscal transfers that ensure comparable levels of service delivery across SNAs.

f. Development of capacities for efficient decentralized public financial management.

g. Design and implementation of accountability mechanisms for SNAs to their constituencies.

Submission to the ADB Board of the second subprogram of the Decentralized Public Service and Financial Management reform subprogram 2 (Loan 2886) is expected in September 2015. The second subprogram, for a total amound of $35 million will equally include a policy-based loan and a project loan. The project loan component will aim to assist the establishment of the Sub-national Investment Fund, a grant mechanism for local infrastructure projects.

A recent mid-term review mission concluded that good reform progress has been achieved. Looking forward, further progress on functional decentralization, on expanding local revenue bases (with the assignment of tax-powers for Sub-national Administrations in particular) and overall capacity development of sub-national administrations (including the implementation of social accountability mechanisms) rank as the top reform priorities.

Project Rationale and Linkage to Country/Regional Strategy The Decentralized Public Service and Financial Management program aims to improve access to and coverage of basic services across Cambodia, by assisting the development of an efficient system of inter-governmental fiscal relations. The latter include aspects relative to the policy and regulatory framework for decentralization, institutional and policy coordination mechanism, expenditure and revenue assignments, transfers and public financial management systems, and reforms aimed at fostering accountability between local administrations and their constituencies.
Impact The Decentralized Public Service and Financial Management program is aligned with the government objective of improving access to and coverage of basic services across the country as defined in the National Program for Sub-national Democratic Development 2010-2019.
Outcome An efficient system of intergovernmental fiscal relations that assists service delivery by subnational administrations
Outputs

Institutions for efficient coordination of subnational democratic development policies established.

A gender-sensitive policy and regulatory framework for decentralization developed and regularly updated.

Clear service delivery responsibilities of SNAs defined.

Efficient tax and nontax revenue sources to SNAs assigned.

Fiscal transfers that ensure comparable levels of service delivery across SNAs implemented.

Capacities for efficient decentralized public financial management developed

Accountability mechanisms for SNAs to their constituencies designed and implemented.

Project Output -

Rural district offices

Project Output -

Expenditure and revenue assignments and fiscal transfers designed and implemented

Project output-

Establishment of the SNIF

Project Output-

Capacities for efficient decentralized public financial management developed

Project Output-

Establishment of the SNIF

Geographical Location
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design

The design included several rounds of consultations to a broad range of civisl society organizations. Drafts of the concept paper and policy matrix were shared and feedback from CSOs sought. The draft Sector Assessment on Public Sectot Management reforms was presented to CSO representatives.

A large number of Government agencies participated in the design and implementation of the program, including the Ministry of Interior, Ministry of Economy and Finance, the National Committee on Sub-national Democratic development ,etc. District and municipal administrations are consulted regularly on all aspects of project implementation. Procurement and contract management of the 35 district offices to be built under Output 1 of the DPSFM project will be led by District administrations.

During Project Implementation
Responsible ADB Officer Juan Gomez Reino
Responsible ADB Department Southeast Asia Department
Responsible ADB Division Public Management, Financial Sector and Trade Division, SERD
Executing Agencies
Nat'l Committee for Democratic Devt at Subnatl LvlMinistry of Interior
Norodom Blvd,Sangkat Tonle Bassac,Khan
Chamcar Mon, Phnom Penh
Timetable
Concept Clearance 05 Mar 2012
Fact Finding 27 Apr 2015 to 05 May 2015
MRM 16 Jun 2015
Approval 16 Feb 2016
Last Review Mission -
Last PDS Update 27 Mar 2015

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Safeguard Documents

See also: Safeguards

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Evaluation Documents

See also: Independent Evaluation

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