Salary reform plans to be delayed: official

via Khmer NZ News Media

Tuesday, 08 June 2010 15:02 James O'Toole

COMPREHENSIVE reforms of the government’s compensation system for civil servants due to go into effect next month are “not yet ready for implementation”, a development official working on the issue said Monday, as details of the controversial new plan remained unclear.

Hady Riad, a counsellor at the German embassy, said there “will still be some discussions which are necessary to flesh out the details” of the new system, announced in January to the surprise of many in the donor and NGO community.

Representatives of the World Bank, UN and other development organisations said the German embassy has been the leading international institution working with the Cambodian government on public administration reform and referred questions to officials there.

“I think everybody knows that there is still some work ahead, and that this needs to be pushed in order to meet these deadlines,” Riad said.

In a December letter to development organisations, Minister of Economy and Finance Keat Chhon announced that effective January 1, the government would cancel salary-supplement programmes for civil servants in a bid to stabilise state finances and maintain equity in compensation. Such programmes had allowed donors to top up the salaries of government workers based on their work on particular projects or issues.

Members of the development community subsequently expressed concern that the abrupt termination of the supplements could spark immediate attrition from government jobs, particularly in sectors such as health and education. In January, therefore, Keat Chhon said the government would allow a six-month transition period during which some forms of supplements could persist.

Based on consultations with government officials in the last few months, Riad said, the new system for compensation and expenses – termed the Priority Operating Costs (POC) system – would create a civil service in which workers of equal rank would receive equal compensation across all sectors of the government.

“The discussions made us believe that one of the major advantages would be that through the introduction of the POC, we would be in a position to harmonize the whole system of salary supplements,” Riad said.

Still unclear is the question of whether POC payments, which are to replace salary supplements, may be adjusted based on the expenses associated with a particular project or on the qualifications of the officials involved, Riad said.

According to a draft of a POC “implementation guide” distributed by the government to development organisations last week, payments from donors in the POC system will be distributed based on the expenses for particular projects rather than as ongoing supplements to the salaries of civil servants. Progress reviews for individuals receiving POC payments are to be conducted every six months, the guide states, and “independent third party audits” of a project may be commissioned by either the government or the donors providing support.

In remarks before the Cambodia Development Cooperation Forum last week, Deputy Prime Minister Sok An said donors spent over US$20 million on salary supplements in 2009 for around 13,000 civil servants. “Surely, we can do better and do it in ways that are more transparent, more merit-based and more equitable,” he said.