Government transfers massive $129M for local budgets

source: Phnom Penh Post

The government has issued a sub-decree ordering the transfer of $129 million from the national coffers to supplement local level budgets.

The funds’ transfer will help provide financial assistance to commune councils and village officials by covering operational costs and spurring local development.

In November last year, after the Supreme Court dissolved the opposition Cambodia National Rescue Party (CNRP), the National Assembly, consisting only of Cambodian People’s Party (CPP), passed a bill setting the 2018 national budget at $4.3 billion.

The sub-decree fulfils a campaign promise of the opposition, which ran in the commune elections on a platform of decentralisation.

Specifically, the CNRP vowed that if it were voted into office at this year’s national elections, it would provide $500,000 to each commune to be used for local development.

CPP spokesman Sok Eysan denied that the sub-decree had anything to do with the CNRP’s campaign promises.

“This is the decentralisation system that gives all communes the means to develop locally, and it doesn’t need the CNRP to discuss it.

“The plan has existed for a long time. Once there is financial ability, we will distribute the money,” Eysan said.

He also said the sub-decree wasn’t about a popularity contest either. “We share based on the national budget. We never considered gaining popularity from this. Whatever they say is irrelevant,” he said.

The Royal Book for the transfer of the funds was signed by Prime Minister Hun Sen and the ministers for interior and finance on April 11 and obtained by The Post on Monday.

Article 4 of the sub-decree says that a portion of the national budget must be transferred to the communes’ budget for a five-year term as measured in the percentage of the government revenue.

It follows that the communes’ 2019 budget will be three percent of government revenue as adopted in the national budget for 2018. The 2020 commune budget will consist of 3.1 percent of the national budget that will be adopted in 2019.

And finally, the amount to be given to communes in 2023 will be 3.4 percent of the budget passed in 2022.

The budget law adopted in November said the government’s fixed revenue for 2018 is $4.3 billion, 3.0 percent of which is $129.6 million.

Neutral and Impartial Committee for Free and Fair Elections in Cambodia, Sam Kuntheamy said the decentralisation plan is a good idea that serves two purposes for the ruling party.

“If the government implements it, it is a good thing because it helps in local development. And by using this strategy, previously suggested by the CNRP, it will gain popularity and develop communes and villages,” he said.

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