Education / News

Ministry to Transfer Funds to Schools Via Bank Instead of Suitcase

by Laignee Barron and Chhay Channyda  / Phnom Penh Post

cashLike mob deals and black market trades, the Cambodian school budget is dealt in suitcases of cash.

Four times a year, the school operating budget is dispersed in stacks of cash transferred from the central bank to the Ministry of Education, eventually ending up with the school principals who fetch the bills from district education offices.

But the Swedish International Development Cooperation Agency (SIDA) and the Ministry of Education are trying to change the system with bank accounts, one for every school.

“This is one way to minimise corruption – when the money goes through the provinces and then the districts and then the schools in stacks of cash, the right amount isn’t always coming through,” said Kristina Kühnel, head of development cooperation at the Swedish Embassy of Cambodia.

Minister of Education Hang Chuon Naron estimates that only 800 of the Kingdom’s more than 11,000 public schools has a bank account, but by the 2014-15 school year, he wants every one to have an account with Acleda, which operates in every district in Cambodia.

Initially, the accounts will be used only for the SIDA-funded School Improvement Grants, a three-year, $23.8 million project in which schools will receive allowances catering to each one’s individual needs.

But the long-term goal is to merge the grants and the schools’ operating budgets, channeling the funds into a single bank account to be used at each school’s discretion.

“It will be more efficient, keep the money safely and will allow better monitoring of how resources are being spent,” Chuon Naron said, adding that a proposal has already been sent seeking government approval for the allocation of school budgets via bank accounts next year.

Under the current system, school officials complain of having to drive long distances to collect the cash, which is also frequently delayed.

“The money always comes late,” said Bot Pheakdey, director of Sok An Khvav High School in Takeo province. Pheakdey said his school has to pay for repairs, teaching materials and even utilities on credit, because the funds take so long to get to his remote district.

“In some cases the cash doesn’t even come through in time for the schools to actually spend it before the end of the fiscal year,” said Gordon Conochie, fundraising and advocacy adviser at the NGO Education Partnership. And money not spent before December 25 must be returned.

While bank accounts could eliminate “informal fees” or other irregularities, education experts point out that they won’t change the fact once the money is withdrawn from the bank and taken to the school, the safest place to store the yearly budget is often under the principal’s mattress.

“The school manager is still going to be withdrawing and keeping cash. There needs to also be proper accounting and recording procedures,” said Kol Preap, executive director of Transparency International Cambodia. “Bank accounts are step forward, but not the ultimate solution.”

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