The country’s wallet: Understanding and tracking Cambodia’s National Budget

Cambodian-RielA National Budget is arguably the single most influential publication a government can produce.

It’s more than a collection of numbers and dollar signs – it’s a document that shows what a government values, and the direction it wants the country to take.

It shows the state of the economy and reflects the political and social landscape of the nation and its place in the world. Importantly, it also shows where vulnerable people’s needs are not being met, and presents opportunities for lobbying and advocacy.

But all of this can be hidden behind a perplexing process, complex jargon and often, an extreme reluctance from politicians to share details with the public. It’s a long road to creating political change – particularly in Cambodia – and the first step is understanding how our National Budget works.

Every budget contains two parts – revenue (income) and expenditure (spending).

This means that a budget will firstly contain how the government plans to make money – from sources like taxes, fees, loans and aid.

Secondly, it details how it plans to spend that revenue. This is done by allocating running costs of the government itself, distributing funding to ministries to spend on public services, and also allocating money to pay interest and loans.

Simple so far, right? Next up…

The budget cycle lasts all year, and there are four stages to the cycle.

Courtesy NGO Forum.

Courtesy NGO Forum.

  1. FormulationMarch onwards: The Ministry of Economy and Finance (MEF) puts together a statement giving the macro-economic policy – a statement about the behavior of the overall economy, including factors like unemployment and inflation.

Using those guidelines, the various ministries will put together their plan for how much funding they will need and their plans for what to spend it on. These are known as budget proposals, and they are submitted to the MEF by mid-July.

  1. Image courtesy One.Org.

    Image courtesy One.Org.

    Enactment – The proposals are debated and eventually approved by the National Assembly. This is enacted into law as the Budget (Financial) Law in December.

  1. Execution – This is when the money gets spent! Of course, spending (in theory) will happen fairly evenly throughout the year. But after the enactment of the National Budget, ministries and their associated departments carry out the budget proposals they prepared.

This expenditure includes purchasing goods, like equipment for public health centers and paying salaries for government staff, like civil servants, teachers and police. It also involves spending money for maintenance of government infrastructure, and costs to keep the government itself running.

  1. Audit/Review – Reviews of the budget are published in several ways – monthly, six-monthly and annual reports, a monthly bulletin of statistics and perhaps most importantly, the National Audit Report.

The Audit Report is intended to be an independent evaluation of the government’s collection of revenue and expenditure. It checks whether the accounts of the government are in line with the plan that was set out in the budget. In Cambodia, this audit is undertaken by the National Audit Authority.

Municipal and provincial Department heads at a Ministry of Economy and Finance meeting.

Municipal and provincial Department heads at a Ministry of Economy and Finance meeting.

So that’s how the budget comes together. But how much of it can we see – and how can we advocate for new budget initiatives or funding?

Budget publishing

Currently, information about Cambodia’s budget is difficult to access. In many countries, a Citizen’s Budget is published by governments to give a non-technical overview of what the budget contains. This process does not exist in Cambodia. In the International Budget Partnership’s most recent Open Budget Survey, Cambodia scored just 15 out of 100, signifying scant to no public information.

Consequently, it can be difficult to lobby for budgetary changes. But there are ways!

Minister of Economy and Finance H.E. Aun Porn Moniroth (centre). Image courtesy AKP.

Minister of Economy and Finance H.E. Aun Porn Moniroth (centre). Image courtesy AKP.

Paths to Budget action

  • Check on the funds allocated to particular projects and departments relevant to your work (for example, the Ministry of Mines and Energy, or the General Department of Petroleum). Overall funding can be found in the Promulgated Budget Law or Annual Finance Law in the Governments Official Gazette and the MEF website (mef.gov.kh). Unfortunately, funding is not classified program-by-program in this document.
  • Check the audit – The only other way that the public can check up on the Royal Government’s budgetary spending is to look at the National Audit Report. However, the reports currently take years to be published, meaning that the funding has long ago been spent. The most recent National Audit Report published was for the 2011 budget. Consequently, scrutiny is difficult.

At CRRT, we think there is a clear need for greater budget transparency in Cambodia. It’s not just a concern for civil society activists – every citizen has an interest in knowing how the government is spending its revenues.

To find out more about the National Budget in Cambodia, visit the NGO Forum’s Cambodian National Budget website.

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