Date 16 October 2014

Opening Remark  


H.E. Dr. Aun Pornmoniroth,

Minister of the Ministry of Economy and Finance


On the Occasion of

Workshop on Program Budgeting and Budget Entity for Line Ministries

Phnom Penh, Le Royal Hotel, October 16, 2014




-      Excellencies, Ladies and Gentlemen


Today, I am honored and delighted to participate in this important training course on Program Budgeting and Budget Entity for Trainers and Budget Officials organized for participants from fifteen ministries-institutions. At the outset, I would like to extend a warm welcome and thanks to Excellencies, Ladies and Gentlemen, who are the leadership of the ministries-institutions, general departments, departments of the fifteen ministries-institutions, the participants and development partners for being here.

Taking this opportunity, I would like to thank the development partners, namely, the U.S. Department of Treasury, World Bank, European Union and UNICEF, for the continued supports that help us continuously organize the course on program budgeting. I also would like to express my heartfelt thanks to the three experts of the US Department of Treasury for being here with us once again to help make the fifth course on program budgeting and budget entity for trainers and budget officials possible.

As Mr. Hav Ratanak, Director of the Budget Formulation Department of the General Department of Budget of the Ministry of Economy and Finance just reported that the similar course has been successfully organized and produced fruitfully satisfactory results for four times, by totally producing the knowledgeable and proficient 1, 350 trainers and budget officials. Today training is the fifth course that the ministry of Economy and Finance has organized and invited 800 officials (trainers and budget staffs) from fifteen ministries-institutions, of which are ready to voluntarily implement full program budgeting in 2016.

-      Excellencies, Ladies and Gentlemen,  

In consistent with the strategic direction of Cambodian budget system reform 2013-2020, the result or performance based and decentralized public financial management or budget system, that has just been put in place, is a modern budgeting system that line ministries are not only delegated authority to create their activities to produce targeted result/outcome and manage their own inputs, but also take responsibilities and accountabilities for results or performances. Therefore, to be capable to implement this budgeting system, it is required for all line ministries-institutions to have your ownership and proactive approach to manage, define and modify policy objective and design management structure to be consistent with the structure of the modern budgeting system. This requires the involvement of all parts and levels of organizations with real willingness, strong commitment, ownership, responsibility and active management in strengthening both human and institutional capacity.

Within the framework of public financial management reform, the implemented budgeting system is the important tool for us to achieve our objective of linking budget to policy and performance accountability, which is the objective of phases 3 and 4 of our public finance management reform program. Having said that, we have been gradually preparing for this through starting execute budget strategic plan and program budget pilot since in 2008 and we have also prepared for implementing full program budgeting in ten ministries in 2015. Next, we will persuade other line ministries-institutions to voluntarily implement full program budgeting and strongly expect that all ministries-institutions are capable to implement the full program budgeting by 2018.

In this regard, the targeted fifteen ministries-institutions are requested to assign their officials to participate in this course as the ministry of economy and finance has considered that these ministries would have adequate capacity to voluntarily implement full program budgeting before the rest does it. In addition, the fifteen ministries are considered as large ministries in term of the amount of budget revenue collected and expending budget. Therefore, if another ten ministries implement full program budgeting in 2016, together with the ten ministries that will implement full program budgeting in 2015, thus about 80% of total national budget will be implemented full program budgeting.

To realize this objective, the ministry of economy and finance has paid attention to continuously organizing the training course on program budgeting and budget entity to train its budget officials and those of line ministries-institutions, particularly those who have potential to train to be the trainers. This is a key approach to ensure that full program budgeting is implemented successfully at the central and provincial administration of line ministries-institutions. By Learning from the technical and ministerial meeting on budget negotiation in 2015, budget proposals, submitted by the ten ministries that implement program budgeting in 2015, are considered as acceptable budget formulation, despite some of them has faced difficulty in defining policy objective, designing program structure and their respective budget entity is not yet assigned clearly, so that certain ministries are required to change their respective budget entity before their budget is implemented. In addition, more challenges will be faced in budget execution stage, particularly the procedure for implementing program budget and change management. To address these concerns, ministry of economy and finance has worked very hard to formulate a guideline on the procedure for the implementation of the program budgeting in order to launch it for the implementation of the budget law in 2015.

-      Excellencies, Ladies and Gentlemen,

Program budgeting is required us to work together when we implement it to ensure that budget is linked with policy objective, set by each ministry, so that it is critical that senior management of the ministry engages in developing policy objective, which is a policy statement of specific action to be taken by a ministry to achieve the goal of the program during the next five years. In addition, to measure the result / performance of programs, subprograms and activities, outcome / result indicators are used for measuring progress towards achieving the policy objectives, output and outcome targets through effectively allocating budget to the specific programs, sub-programs and activities. This task cannot be done by a single general department/ department of finance, but is required that specialized general departments/ departments are get involved to identify important functions and indicators and the general department/department of finance provides and sum up estimate costs and allocate budget to the programs based on the budget strategic plan of each ministry.

In this regard, I strongly support this program and training method and encourage the budget formulation department to organize such training course by further strengthening and enhancing its quality and by ensuring effective and efficient training, that is the training course is designed to train the officials, who have directly involved in budget formulation as this specific course could not be found its availability at college and university. After the completion of the fifth course on program budgeting and budget entity, I strongly believe that at least five ministries-institutions will voluntarily implement full program budgeting in 2016, so that the ministry of economy and finance intend to invite only another five ministries-institutions among the fifteen ministries-institutions being here in order to have ten ministries-institutions implement full program budgeting in 2016.

I strongly believe that the close cooperation between Ministry of Economy and Finance and development partners in the capacity building will help Cambodia to realize strategic direction of budget system reform. In this regard, I would like to suggest the US Department of Treasury, World Bank, European Union and UNICEF and other development partners to continue your supports to the organization of the courses and other technical assistances to help us smoothly implement program budgeting to ensure that all ministries-institutions have sufficient capability to formulate and implement full program budgeting by 2020 in parallel with the strategic direction of budget system reform 2013-2020, which was launched by Samdech Techo Hun Sen before the end of the Royal government of fourth legislature.

Once again, I wish to thank Excellencies, Ladies, Gentlemen, and participants  for spending your value time to  participate in this important course on Program Budgeting for trainers and budget officials. Finally,  along with the opening of the course on program budgeting and budget entity for trainers and budget officials, I wish Excellencies, Ladies and Gentlemen the four Buddhist blessings: Longevity, Nobility, Healthiness and Strength.


Thank you!