NINTH QUARTERLY PROGRESS REPORT (1 February 2014 to 30 April 2014)

Transcription

1 KINGDOM OF CAMBODIA Nation Religion King Ministry of Water Resources and Meteorology Water Resources Management Sector Development Program ADB Loan 2673-CAM and TA 7610-CAM NINTH QUARTERLY PROGRESS REPORT (1 February 2014 to 30 April 2014) TA 7610-CAM: Supporting Policy and Institutional Reforms and Capacity Development in the Water Sector

2 REVISION HISTORY Version Date Written / Revised by: Checked by: No May 2014 Ian WOOD (Program Team Leader - Water Resource Expert) Thierry DELOBEL (Project Director Egis) Cover photos: Left: O Touk Reservoir Scheme, main canal (originally constructed during Khmer Rouge Regime), Kompong Thom Province, San Dan District. ADB Loan 2672/8253 Grant 0220 (SF) WRMSDP, Component C is rehabilitating the Reservoir. Right: Ong Pang Calmatage Scheme, Kandal Province, Sa Ang District, FWUC committee explaining scheme operation. ii

3 Table of Contents 1. INTRODUCTION UPDATE ON KEY ISSUES OVERVIEW MISSION FROM WATER RESOURCES MANAGEMENT ADV ISOR PETER LOGAN TRANCHE 2 CONDITIONS STATUS AND COMPLIANCE TARGETS STATUS OF WORKING GROUPS DISCUSSION AND PROPOSED ACTIONS Compliance with Second Tranche Conditions FWUCs Sub-decree National Water Resources Policy and Implementation Plan, and Investment Plan Monitoring and Assessment of Water Resources Irrigation Operation and Maintenance Cambodia Irrigation Scheme Information System (CISIS) SUMMARY OF CDTA ACTIVITY OPERATION AND MANAGEMENT ISSUES COMMITMENT OF CDTA FUNDS PROGRAM STAFFING OUTPUTS THIS QUARTER AND KNOWLEDGE PRODUCTS List of tables Table 1: Key issues from meeting with the Minister, 25 March Table 2: Status of Compliance for Tranche 2 Conditions... 4 Table 3: Status of Working Groups... 8 Table 4 OUTPUT A: Enhanced Capacity of Government to Manage Water Resources Table 5 OUTPUT B: Enhanced Capacity of MOWRAM to Manage and Deliver Irrigation Services17 Table 6: Estimated CDTA funds Table 7: Estimated funds committed Table 8: Utilization of Consultant Inputs on CDTA 7610-CAM Table 9: Personnel Schedule CDTA 7610-CAM List of attachments Attachment A: Water Resource Management Advisor (Peter Logan) Mission Report (16-18 May 2014) Attachment B: Attachment C: Attachment D: Attachment E: Attachment F: Minutes of Meeting with HE Lim Kean Hor, Minister of MOWRAM, 25 March 2014 Cambodian National Water Reform Pathway Cambodia Monitoring and Assessment Program Proposal Cambodian Irrigation Scheme Management Reform Pathway List of TA7610 Knowledge Products iii

4 Acronyms and Abbreviations ADB APF BSP CCA CDTA CISIS CNMC CoM D&D DMF DPIC FWUC HRD IAD IOW ISF ISPU ITC IWRM KCC LoA M&A MAFF MEF MoE MOWRAM MPWT MRD MTR NCWRM NDF NDP NWRIP NWRP NWSR O&M PDA PDWRAM PFMRD PMO PSG RBC Asian Development Bank Advance Payment Facility Budget Strategic Plan Climate Change Adaptation Capacity Development Technical Assistance Cambodian Irrigation Scheme Information System Cambodia National Mekong Committee Council of Ministers Decentralization and De-concentration Design and Monitoring Framework Department of Planning and International Cooperation (of MOWRAM) Farmer Water User Community Human Resource Development Irrigated Agriculture Department (of MOWRAM) International Office of Water Irrigation Service Fee Irrigation Services Program Unit Institut de Technologie du Cambodge Integrated Water Resources Management Key Consultants Cambodia Letter of Agreement Monitoring and Assessment Ministry of Agriculture, Forests and Fishery Ministry of Economy and Finance Ministry of Environment Ministry of Water Resources and Meteorology Ministry for Public Works and Transport Ministry for Rural Development Mid-Term Review National Council for Water Resources Management Nordic Development Fund National Program Director National Water Resources Investment Plan National Water Resources Plan National Water Status Report Operation and Maintenance Provincial Department of Agriculture Provincial Department of Water Resources and Meteorology Public Financial Management for Rural Development Program Management Office Permanent Secretariat General River Basin Committee iv

5 RBM RBP RD RGC RRP SD SEP TA TC TNA TOR TSA TSC WG WRMSDP River Basin Management River Basin Plan Royal Decree Royal Government of Cambodia Report and Recommendations of the President Sub-decree Stakeholder Engagement Process Technical Assistance Tranche Condition Training Needs Assessment Terms of Reference Tonle Sap Authority Technical Service Center (of MOWRAM) Working Group Water Resources Management Sector Development Program v

6 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report 1. Introduction The capacity development technical assistance for Supporting Policy and Institutional Reforms and Capacity Development in the Water Sector (CDTA 7610-CAM) was formulated to assist the Ministry of Water Resources and Meteorology (MOWRAM) implement the Water Resources Management Sector Development Program (WRMSDP) 1 in Cambodia. WRMSDP comprises a program component to address national water resources management and irrigation policy issues in Cambodia, and an investment component to assist MOWRAM rehabilitate small- and medium-scale irrigation systems and deliver irrigation services within the Tonle Sap Basin. CDTA 7610-CAM is financed by ADB s TA funding program (TASF-IV), Australian Aid, the Nordic Development Fund (NDF), and the Royal Government of Cambodia (RGC). International and national specialists employed by the joint venture of Egis International (France), Egis Eau (France) and Key Consultants (Cambodia) Ltd. (KCC), hereinafter referred to as the Consultant, and commenced their services on 16 January The consulting services under CDTA 7610-CAM provide specialist support to MOWRAM for the following: (i) develop MOWRAM s capacity to manage water resources through strengthening the strategy, policy and legal framework for integrated water resources management (IWRM) (ii) improve coordination and cooperation with other ministries and agencies, and at the river basin level (iii) strengthen MOWRAM's capacity to promote IWRM and climate change adaptation (CCA) (iv) develop human resources capacity (v) strengthen policy, planning and legal framework for irrigation management and service delivery (vi) strengthen MOWRAM's capacity to manage, operate and maintain irrigation schemes. MOWRAM is the executing agency for CDTA 7610-CAM and both the program and project components of WRMSDP. Ministry of Economy and Finance (MEF) monitors use of loan proceeds and counterpart funds generated from the Program Loan. This report is the ninth quarterly progress report (QPR9) for CDTA 7610-CAM and covers the period 1 February 2014 to 30 April The report describes accomplishments of the CDTA during the 3-month reporting period, with reference to the tasks and activities listed in the design and monitoring framework (DMF) of the Report and Recommendation of the President (RRP) for Loans 2672/2673-CAM. 1 ADB Report and Recommendation of the President to the Board of Directors on Proposed Loans, Grant, Technical Assistance Grant, and Administration of Loan and Technical Grants to the Kingdom of Cambodia for the Water Resources Management Sector Development Program (Loans 2672-CAM and 2673-CAM). Manila. 1

7 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report 2. Update on Key Issues 2.1 Overview This quarter yielded mixed results for the WRMSDP. While there was a steady progression of advances in activities within the direct control of the CDTA team such as in river basin management planning in Stung Sreng and budget strategy planning for operations and maintenance there were some setbacks and further delays in policy reform, noticeably in the failure to pass the sub-decree on FWUCs and slow progress on sub-decrees for River Basin Management, Licensing and Water Quality. Highlights for the quarter included: Completion of background studies on water availability, water use and the river environment to support river basin management planning in the Strung Sreng river basin and significant progress towards the establishment of an interim river basin management committee Significant engagement with MOWRAM and PDWRAMs in pilot provinces to establish a procedures manual for the preparing budget strategic plans (BSPs) for operations and maintenance (O&M) Completion of activities for climate change including completion and dissemination of the climate change database, training of high-level inter-ministerial committee and formal endorsement of the climate change results Completion of the Cambodia Water Resources Profile Report, which provides the basis for a base-line understanding of available data and the availability of both surface water and groundwater resources in time and spatially across the country Approval of work plans for Gender Mainstreaming (WG2) and Operations and Maintenance (WG7), although the work plan for TSA (WG10) faces continued delays. Completion of all ten special studies that provide background information for preparing the National Water Status report Results in other areas of the program were less successful and will require continued close supervision and/or intervention to maintain momentum. In particular, issues of concern include: Withdrawal of the FWUCs sub-decree from the agenda of the Council of Ministers (CoM) Slower than expected progress on advancing the sub-decrees on River Basin Management, Licensing and Water Quality to step of Minster-level approval, prior to submission to the CoM Delays to the passage of the Royal Decree on National Council for Water Resources Management (NCWRM) Further delays to finalizing the ADB funding arrangement for under-graduate scholarship program at Institut de Technologie du Cambodge (ITC) Delays to obtaining MEF approval for the MOWRAM bank account to be linked with the Advance Payment Facility (APF) to channel CDTA funds 2

8 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report 2.2 Mission from Water Resources Management Advisor Peter Logan In his role as advisor to the National Program Director (NPD), Mr Peter Logan undertook a mission to the program from 16 to 28 March 2014 with the purpose assisting with the difficulties being encountered with the Tranche 2 conditions, particularly Conditions 1 and 2 relating to the passage of four sub-decrees and the Royal Decree through the Council of Ministers (CoM). During the ADB review mission of December 2013 the target date for submission of these pieces of legislation to the CoM was set at 31 January 2014, however by mid-march 2014 neither the subdecrees nor the Royal Decree has been tabled. During his mission, Mr Logan was able to consult with stakeholders including the NPD, the CDTA team and the Ministry of Economics and Finance (MEF). In addition, Mr Logan met with HE Minister of MOWRAM on 25 March 2014 to discuss compliance progress of 2nd Tranche Conditions, and seek HE Minister s guidance regarding the appropriate next steps. The meeting focused on 2nd Tranche Condition TC1 involving 4 sub-decrees, and condition TC2 involving a Royal Decree to establish a National Council for Water Resources Management (NCWRM). A summary of the key issues discussed with the Minister and the current status of these issues is presented in Table 1 below. Table 1: Key issues from meeting with the Minister, 25 March 2014 Issue and agree action Status as at 30 April 2014 FWUC sub-decree: HE Minister agreed to request Working Group 4 (WG4) to revisit Article 35 2 and determine if appropriate revision could be introduced that would be acceptable in the current political climate, without compromising the effectiveness of the sub-decree. River Basin, Water Quality, and Licensing Sub-decrees: Given that WG4 has nearly completed a review of the River Basin subdecree and the other 2 sub-decrees did not need revision, HE Minister agreed to lead an internal review and finalization of the 3 subdecrees, and submit them for consideration of the CoM by end May It was acknowledged that the Licensing Sub-decree may prove to be sensitive, so passage through the CoM might be more problematic than for the other 2 sub-decrees. NCWRM (through Royal Decree): The HE Minister gave in-principle support to the draft Royal Decree for establishment of the NC WRM as submitted after WG6 review in January However, with reference to the Law on Water Resources Management Articles 4 & 5, HE raised concerns about consistency and indicated that some refinements need to be considered. HE Minister requested that the Governance Advisor (Dr Pech Sokhem) review and recommend appropriate modifications to address the concerns and discuss these with WG6. The draft Royal Decree should be re fined accordingly and resubmitted to HE Minister for consideration. The CDTA has prepared a draft discussion paper on issues relating to water service fees, including comparison with experience in Vietnam, Thailand and Australia. Wor king Group 4 has been authorized to discuss the subdecree during a series of meetings scheduled for May 2014 WG4 completed review of the River Basin sub-decree and has submitted this, along with the other two sub-decrees to HE Minister for his consideration. No schedule has been set by HE Minister for the final internal review. Dr Pech Sokhem completed a review of the Royal Decree and a revised version and a Presentation Note (in Khmer and English) were submitted to the NPD on 22 April This was forwarded to the Minister, however no direction has been received regarding the next step. It is understood that WG4 will be assigned to under take a final review on behalf of MOWRAM and it is anticipated that this can occur during May Article 35 sets out the requirements for the collection of Irrigation Service Fees (ISF) and provides a formula for the calculation of fees to be applied by all FWUCs 3

9 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report In his mission report, Mr Logan makes the observation that the recent events highlight the challenges associated with legislative reform in MOWRAM. The vacillation on the FWUC subdecree is not new; the sub-decree has been under constant discussion for about seven years, and the CoM considered it on four occasions during 2012 without passing it. Mr Logan s complete Mission Report is provided in Attachment A and the minutes of the meeting with the Minister is provided in Attachment B. 2.3 Tranche 2 Conditions Status and Compliance Targets The status of the Tranche 2 conditions is summarized in Table 2. Table 2: Status of Compliance for Tranche 2 Conditions Program Tranche 2 Condition Strengthen Legal Framework for IWRM TC1. The Borrower shall have issued either sub-decrees or Prakas, as appropriate, on the procedures for the establishment of F WUCs; river basin management; the establishment of water allocation/licensing; and water quality. Status and compliance target FWUC sub-decree: Withdrawn fro m the CoM meeting agenda just prior to the scheduled meeting on 21 February 2014 in response to political sensitivity about irrigation service fees (Article 35). HE Minister has agreed for WG4 to review and consider possible revisions to Article 35, which is expected to occur in May A schedule for revision and re-submission is yet to be confirmed. Other three sub-decrees: WG4 has completed revision of the River Basin Management (RBM) sub-decree and the working group has deter mined that the current drafts of the other two sub-decreed do not need revision. HE Minister agreed to conduct a final MOWRAM internal review prior to a possible submission date of May 2014 for CoM consideration. Estimated Compliance: uncertain, unlikely be fore Oct 2014 TC1 Trigger for compliance agreed at Mid-Term Review May 2013 (MTR) Prepare draft sub-decrees through a consultation process ( WG4 and national seminars). Submit sub-decrees for consideration /approval of Council of Ministers (CoM) and/or Prime Minister. Compliance: sub-decrees signed & stamped by Prime Minister Improve National Coordination and Collaboration on Water Resources Management TC2. The Borrower shall have established and operationalized a ministerial level committee for coordination of water resources management 3 (NCWRM) to be chaired at the highest level of the Borrower and include relevant ministers as members, and supported by an inter-ministerial secretariat. TC2 Trigger for compliance agreed at MTR The draft Royal Decree to establish the NC WRM was revised by WG6 in January 2014 and submitted to HE Minister. Based on the Minister s request of 25 March, the RD was been revised and re-submitted to the Minister. The CDTA team have recommended to the NDP that the RD should be submitted to the CoM. Estimated Compliance: uncertain, unlikely be fore Q Complete a draft Royal Decree to establish the NC WRM and the Per manent Secretariat General (PSG) through a consultation process (WG6 & national seminars). In parallel, prepare a Sub-decree to establish the Secretariat Office of the NC WRM /PSG. Submit Royal Decree for consideration /approval of CoM, and then obtain Royal signature. Submit Sub-decree for the Secretar iat Office for approval of CoM / Prime Minister. Compliance: Royal Decree and Sub-decree (as above) signed and stamped, and first meeting of NC WRM held. 3 MOWRAM propose that the ministerial level committee for coordination of water resources management be named the National Council for Water Resources Management (NCWRM) 4

10 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report Program Tranche 2 Condition TC3. The Borrower through a ministerial level committee for coordination of water resources management (NCWRM) shall have issued a policy that shall clarify the coordination and cooperation mechanisms between CNMC, TSA, MOWRAM and river basin committees (RBCs). Status and compliance target It was agreed during the MTR to make an assessment as to whether the coordination & cooperation policy is still needed, given that all of these entities are now headed by the Minister MOWRAM. No recent action taken. The assessment re ferred to in the MTR will be made as part of the Na tional Water Status Repor t looking at institutional arrangements. Estimated Compliance: Q TC3 Trigger for compliance agreed at MTR Through meetings with stakeholders, make a general assessment to deter mine if there are ongoing coordination and cooperation issues that need to be addre ssed. Compliance: to be decided as per assessment Implement National Water Resources Policy TC4. The Borrower through the ministerial level committee for coordination of water resources management shall have (a) commissioned a review of the national water resources plan (NWRP) ( ); and (b) issued recommendations for the preparation of the national water resources plan ( ). Condition replaced by preparation of a National Water Status Report (N WSR) at MTR. Considerable progress has been made on the N WSR including the completion of ten special studies which examine specific issues and the near completion of the draft Indicator Report. While the preparation of the N WSR remains on schedule, complete compliance with the tranche condition will be contingent on establishment of the NCWRM. Estimated Compliance: Q TC4 Trigger for compliance agreed at MTR Preparation of a NWSR, as a precur sor to a full-blown N WRP. Finalize the N WSR through a consultation process ( WG6 and a national seminar). Compliance: NWSR submitted to the NC WRM (National Council for Water Resources Management) Pilot Test Mechanisms for River Basin Level Coordination and Collaboration TC5. The Borrower through MOWRAM shall have established the Stung Sen river basin committee (RBC). Condition revised at MTR to have CDTA overseeing the preparation of the draft Stung Sreng River Basin Plan (RBP), as the Tonle Sap Authority (TSA), with support fro m the International Office of Water (IOW), has responsibility for the Stung Sen RBP. The program continues to provide financial support to the Stung Sen River Basin Plan (RBP) project conducted by the IOW. Progress with River Basin Management Plan for Strung Sreng is on-track. A river basin Water Resource Profile Report is complete and consultation with provincial stakeholders was conducted in February The first meeting of the Stung Sreng Inter im River Basin Committee took place on 3 April Estimated Compliance: Q TC5 Trigger for compliance agreed at MTR Approve the River Basin Management Sub-decree (see Condition 1) Compliance: Directive based on the Sub-decree issued by MOWRAM to for mally establish the RBC. National Assessment of Water Resources TC6. The Borrower through MOWRAM shall have prepared and approved a national water resources profile. TC6 Trigger for compliance agreed at MTR The National Water Resources Profile Report was completed in April Final approval fro m MOWRAM expected in ear ly May Estimated Compliance: May 2014 Compliance: A repor t covering the profile of both surface and groundwater in Cambodia approved by MOWRAM. Mainstream IWRM and Climate Change Adaptation TC7. The Borrower through the ministerial level committee for coordination of water resources management shall have established procedures to mainstream (a) IWRM in the national water resources plan; (b) climate change adaptation in IWRM plans; and (c) IWRM in climate change adaptation plans and actions. Assessment of climate change vulnerability is completed and toolkit /procedures for Ministry of Environment (MoE) and MOWRAM staff to use are prepared. Ratification of these by WG6 was confirmed in February 2014, (as per MTR agreement), and staff training was also completed, thus fulfilling the conditions for compliance agreed during the MTR. Complied: February

11 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report Program Tranche 2 Condition Status and compliance target TC7 Trigger for compliance agreed at MTR Prepare procedures (tool-kit). Implement training for relevan t staff of ministries (to be nominated by WG6). Compliance: Procedures ratified by WG6 and staff trained. Develop Technical Skills (tertiary) at ITC TC8. The Borrower through MOWRAM shall have commenced the implementation of the plan developed by ITC and MOWRAM for effective delivery of bachelor and post-graduate engineering degree courses in water resources management. At the end o f April 2014 the funding arrangement via a Letter of Agreement (LoA) between ADB and ITC is yet to be finalized. (A significan t delay fro m ADB s promised completion by 31 January 2014). The ongoing delay is causing considerable disquie t among students and staff at ITC and is impacting on the ability of ITC to deliver certain aspects of the tra ining. Estimated Compliance: mid-2014, contingent on ADB finalizing the LoA TC8 Trigger for compliance agreed at MTR Contract signed between MOWRAM and ITC for implementation of the bachelor degrees. Develop a post-graduate curriculum based on a needs assessment and identify funding sources. Compliance: Course work for both bachelor and post-graduate courses commenced. Legal status of irrigation works TC9. The Borrower through MOWRAM shall have (a) adopted the guidelines for division of asset responsibility between the Borrower and water users; and (b) assigned appropriate responsibilities and rights for irrigation infrastru cture to respective F WUCs within the Project Area. TC9 Trigger for compliance agreed at MTR Delay in approval of the F WUC sub-decree is a setback to establishing a legal basis for rights and responsibilities. However, based on existing guidelines, the program continues to work with the F WUC depar tment, Irrigated Agriculture Department (IAD) and WG7 to draft the rules for division of assets and assignment of rights and responsibilities. Estimated Compliance: Q4 2014, but some uncertainty pending passage of the F WUC sub-decree Approve FWUC Sub-decree. Prepare guidelines based on the Sub-decree. Prepare a nation-wide plan to develop financially independe nt F WUCs. Apply the plan in the Project Area. Compliance: Guidelines adopted by MOWRAM; and formally registered agreements concluded with F WUCs in the subprojects of the Project Area. Strengthen MOWRAM s internal linkages between line departments TC10.The Borrower through MOWRAM shall have (a) completed the review of MOWRAM s organizational stru cture, capacity, systems and staff re sources; and (b) defined the appropriate demarcation of responsibilities within MOWRAM for water resource management and irrigation service delivery. A review of MOWRAM s organizational structure is complete along with a tra ining needs assessment. In addition, it is proposed that as part of the N WSR, the CDTA will make an assessment of institutional arrangements for water resources management in general through consultations within MOWRAM and with other Ministries. Estimated Compliance: Q TC10 Trigger for compliance agreed at MTR Conduct a training needs assessment (TNA) to assess capacity and staff resources. CDTA to prepare a report on the TNA findings, and based on this, indicate possible adjustments to existing organ ization stru cture taking into consideration new roles of MOWRAM introduced under the Program reforms aimed at improving water resource management. Compliance: The report tabled for consideration of the WG5. 6

12 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report Program Tranche 2 Condition Strengthen MOWRAM's O&M planning processes TC11. The Borrower through MOWRAM shall have prepared, adopted and implemented a comprehensive irrigation O&M plan. Status and compliance target With support fro m MEF and WG7 considerable progress has been towards strengthening O&M planning processes. A draft Manual and Guideline is completed for O&M of Irrigation Schemes, incorporating the principles of O&M as well as standard operating procedures for budget allocations. Additional document s include the Stra tegy for Completing Irrigation Systems, an O&M Policy & Implementation Manual and an O&M Budget Stra tegic Plan for Estimated Compliance: Q TC11 Trigger for compliance agreed at MTR Approve the F WUC Sub-decree. MOWRAM to adopt the O&M plan. Seek budget to implement the plan. Compliance: MOWRAM will have prepared a budget proposal to implement the 2015 O&M plan. Develop Technical Skills (vocational training) TC12.The Borrower through MOWRAM shall have (a) developed and delivered training courses to include on-farm water management and irrigation practices, and maintenance of major and minor irrigation works; and (b) harmonized the training curriculum between F WUC Department and the Technical Service Cen ter (TSC). Training needs and training plans have been prepared and courses including climate change, gender, CISIS, and IWRM have been prepared for MOWRAM, 5 PDWRAMs, and 33 FWUCs. The CDTA are preparing draft contracts for the implementation of the training with TSC and third-party providers. Estimated Compliance: Q Status of Working Groups The design of the WRMSDP envisaged not only implementation via support from a consultant team, but also implementation through direct funding support to Ministerial working groups (WGs) aligned with specific issues. WGs would be funded in accordance with approved work plans with funds sourced both from the CDTA and the RGC. The details and status of each working group is summarized in Table 3. Of the three work plans submitted to MEF in December 2013, only two (WG2 and WG7) have received approval. MEF approval of the WG10 work plan remains outstanding. Preparation of the remaining work plans is behind schedule and actions to acceleration their completion and approval will be accelerated in the next quarter. In their approval of the work plans for WG2 and WG7, MEF substantially reduced the amount allocated from RGC sources. For the WG2 work plan, requested amounts for training, conferences, training allowances and contingency were significantly reduced or removed all together. Of the requested RGC funds of $322,361 for WG2, only $132,000 was approved, a reduction of 59%. For the WG7 work plan, requested amounts for vehicles, training allowances, incidental staff allowances, study tours and visits, recurrent costs and contingency were significantly reduced or removed all together. Only $198,000 of RGC funds was approved compared with the requested amount of $357,005, a reduction of 45%. In their approval, MEF did not change the amount of funds to be sourced from the CDTA. Although two work plans have been approved, implementation is yet to commence pending approval by MEF authorizing MOWRAM to open a bank account to accept CDTA funds via the 7

13 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report APF. Discussion of the bank account with MEF dates back to the MTR of May 2013, and continues to be an on-going sticking point hampering program implementation. Table 3: Status of Working Groups Working Group Approx. Budget a (US$) RGC CDTA Status WG2 Gender Technical Working Group 132, ,038 Wor k plan approved by MEF, February 2014 WG3 WG4 Wor king Group on Public Financial Management Refor m Committee on Preparing Sub-decrees Related to the Law on Water Resources Management 27,000 53,000 Draft work plan to be prepared with mobilization of specialist consultants for financial management re form 100, ,741 Draft work plan prepared and being reviewed by working group members WG5 Wor king Group on Human Re sources Development (e stablished under WRMSDP) 217, ,000 b 11, ,225 b Draft work plan prepared and being reviewed by working group members WG6 Inter-ministerial Working Group on Establishment of an Inter-ministerial Committee for Water Resources Management (established under WRMSDP) 295, ,250 Draft work plan prepared and being reviewed by working group members WG7 Technical Working Group for Maintenance of Irrigation Systems within MOWRAM 135, ,000 c 67, ,594 c Wor k plan approved by MEF, April 2014 WG8 Inter-ministerial Working Group for Planning of Creation of Technical Skills (established under WRMSDP) 277, ,300 d 103, ,320,200 d Draft work plan prepared and being reviewed by working group members WG10 TSA General Secretariat Working Group for the Formulation of the TSA Stra tegic Plan 293, ,100 Wor k plan submitted to MEF December 2013, approval pending 1,891,824 4,119,468 Notes: (a) The accuracy of the budget amounts vary considerably. For WG2 and WG7 the budgets are in accordance with the approved work plan from MEF, Other work plans are still at early draft stage and the final budgets could vary considerably from what is listed here. (b) The work plan for WG5 separately itemizes funds for WG activities and financial support for training (c) (d) The work plan for WG7 separately itemizes funds for core tasks and funds for CISIS data collection The work plan for WG8 separately itemizes funds for core tasks and funds for the undergraduate course in Water Resources engineering 2.5 Discussion and Proposed Actions Compliance with Second Tranche Conditions The assessment summarized in Table 2 shows that two second tranche conditions (TC6 and TC7) of the 12 tranche conditions are (or are close to) complying. A third (TC8) is likely to reach compliance status soon once ADB have been able to complete the internal procedures necessary for the Letter of Agreement with ITC. 8

14 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report A further 7 conditions (TC3, TC4, TC5, TC9, TC10, TC11 and TC12) are on track for compliance in either the third or fourth quarters in The tranche conditions most at risk are the key areas of legislative reform for the four sub-decrees (TC1) and the establishment of the NCWRM by Royal Decree (TC2). While there is general agreement at government officer level that reforms are needed, and indeed the Minister himself has expressed a willingness to proceed, the process of moving forward to ultimate approval remains sluggish. Post-election instability and political sensitivities are typically mentioned as the reasons for delay FWUCs Sub-decree The failure of the FWUCs sub-decree to be tabled at the CoM in February, was undoubtedly a setback for the legislation, however it is not difficult to understand the political sensitivity of the core issue. The current wording of Article 35 of the sub-decree, which dates back to work conducted some three or four years ago (and earlier), sets out quite rigid conditions for the collection of Irrigation Service Fees (ISF). On further reflection, it is clear that a more flexible approach is required because every irrigation scheme is different. As reported during the Workshop on Sustainable O&M Schemes in January 2014, there is considerable evidence to show that where a scheme functions well and a good quality service is provided, irrigators are willing to pay the ISF. On the other hand, in schemes where the delivery of supply is unreliable or unavailable through poor maintenance and damage (such as from floods), it is easy to understand why farmers are reluctant to agree to an ISF. It is expected that WG4 will have the opportunity to review Article 35 during May and June 2014 to examine ways establish an "O&M Sharing Arrangement" (rather than ISF) for each scheme worked out through consultation and mutual agreement between MOWRAM /PDWRAM and the FWUC. This would allow FWUCs to have a say, have ownership of the arrangements, and avoid the risk of the FWUCs losing interest by having a formula imposed on them that might not be well suited to needs. Practical revisions of the sub-decree along these lines are required for it to have chance of being accepted by the Minister and by the CoM. The CDTA team are committed to assisting WG4 with this review process National Water Resources Policy and Implementation Plan, and Investment Plan During the MTR it was agreed that compliance with TC4 would be triggered with the preparation of a National Water Status Report (NWSR) by the end of It is recognized that preparation of the NWSR is baseline assessment, hence is not an end point but rather a stepping-stone for establishing a new National Water Resources Policy and Implementation Plan (NWRP) and accompanying National Water Resources Investment Plan (NWRIP). Initially voiced during the MTR and then repeated in Peter Logan s March 2014 report, there is a clear need to the maintain momentum towards the ultimate goal of a NWRP. Ideally, the NWRP process should commence immediately after the completion of the NWSR, in early 2015, to maintain stakeholders interest, commitment and ultimately their ownership of the policy. Consideration should be given to utilizing 9

15 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report unallocated CDTA funds 4 however this will need to be enhanced with additional (as yet unidentified) donor support. The CDTA team Institutional Specialist (Des Cleary) has prepared an outline of the steps, resources and schedule for establishing a NWRP and NWRIP for Cambodia of which a summary is presented in Attachment C. It based on his experiences for preparing a similar process that was followed by ADB, in partnerships with other donors, in Viet Nam between 2008 and The estimated budget is in the order of $2.5 million and the timeline is 18 months. The CDTA team recognizes that this is just one of many possible approaches, however, what is clear is that the resources required to complete the task are considerably greater than the funds currently unallocated in the CDTA. It is recommended that in order to maintain momentum for this much needed policy development and build on current CDTA investment, ADB should commence engagement with MOWRAM for detailed discussion. Key areas include confirming MOWRAM s interest and support for the NWRP process, possible sources of funds and cooperation with potential international development partners Monitoring and Assessment of Water Resources Preparation the Cambodian Water Resources Profile report has highlighted the importance of data collection and the significant shortfall in capacity, resources and equipment for hydrometeorological and river flow data collection throughout the country. While there are around 160 rainfall stations still operational in Cambodia, for many of the stations the data only spans in the order of 10 to 20 years and often contains significant gaps. Of the 89 river water level recording stations only 44 stations are presently operational. Ten out of the 39 river basins across Cambodia are completely un-gauged. There are currently no wells or bores used solely for the purpose of monitoring and assessment of groundwater resources. Groundwater assessment has relied on information from wells constructed for water production purposes. Currently there is ever increasing pressure on water resources from population growth and exploitation for economic development. This, when coupled with looming threat of climate change, means that over half a billion dollars of irrigation investment decisions have been based on incomplete water resource data records from a poorly maintained monitoring network, and hence carries significant financial risk. Similar conclusions can be made for recent hydropower investments. As demand and investment increases, comprehensive and accurate water data is crucial for optimizing use of water resources, including for protecting environmental assets, to ensure investments meet their objectives in the long-term. A high quality national monitoring networks and assessment process will also help to strengthen investors confidence to supporting larger scale projects within the country. As such a national monitoring and assessment program should be regarded as an important economic investment for the country and, on completion, a significant national asset. The CDTA is currently preparing a discussion paper on the need for and type of monitoring and assessment program required in Cambodia, based on findings from the National Water Resources Profile, the NWSR and other inputs. An outline for an M&A program is shown in Attachment D. A draft paper will be presented to ADB at their next mission for consideration. 4 The current estimate of unallocated CDTA funds is $1.28 million (refer to Section 4.1) 10

16 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report Irrigation Operation and Maintenance The work conducted for the CDTA has clearly demonstrated that the capacity for O&M of irrigation schemes in Cambodia is at a very low level. In addition to a lack of financial resources, there are fundamental problems with organizational systems, planning processes, assessment of O&M needs and priority, capacity of staff and basic resources. These failings have lead to scheme operation and financial return at levels very much below optimum. The study of economics of O&M in irrigation schemes also demonstrated that the lack of O&M not just results in sub-optimal return on investment but actual negative returns. Meaning that developing irrigation schemes and then failing to operate them has a net negative impact on the economy. Thus far on the program, the CDTA team has focused on getting to a point of basic level of service for O&M and in the last three to four months there are encouraging that these efforts are well supported in both MOWRAM and MEF. Getting to a basic level of service for O&M is just the first step on a pathway for achieving sustainable systems that deliver high economic return. WG7 was newly constituted in December 2013 is now very active and taking a strong lead in the reforms. The WG7 chair is now the Director of the Irrigated Agriculture Department (IAD) and all Provincial Directors are Vice-chairs in charge of implementation. WG7 has established a close working relationship with the CDTA specialists, and ramped up the intensity of technical support it seeks from them. The CDTA is currently assisting WG7 to prepare an O&M Budget Strategic Plan that is of particular importance and urgency. Development of the budgeting process is well advanced. Its scope will include not only 15 schemes from each of the 3 pilot provinces but also 15 schemes from each of the remaining 22 provinces. That is, the approach piloted by the CDTA team has found immediate uptake in the IAD. This work will be followed by a range of other much needed activities, such as development of an expenditure management system for O&M, plans for staffing needs, funding for FWUC, etc. It is hugely encouraging that the momentum for policy reforms in irrigation O&M is finally commencing. Hence there is now the opportunity to build on this momentum, while at the same recognizing that these types of reforms take years to implement. The CDTA has developed pathway for reform in irrigation scheme management (see Attachment E). The pathway, structured in four phases, takes scheme management from its current low levels through to a more sophisticated and sustainable level of management. The Pathway makes the distinction between what can be achieved by December 2014 and how much there is further go in successive years. While significant progress can be made under the current program, clearly there is still some distance to go before irrigation scheme management in Cambodia can reach the level of being sustainable. Given the successes achieved and the strong support in Government, it is recommended that consideration be given to extending Technical Assistance support for O&M beyond the completion of the current contract period Cambodia Irrigation Scheme Information System (CISIS) As with operation and maintenance, much needs to be done to operationalize the CISIS database. The database software was upgraded with assistance from CDTA specialist in This work 11

17 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report included providing dual language for ease of use (it was originally developed in English) and an interface with Google Earth for improving the utility of searching for particular schemes. In 2013 the CDTA supported a pilot of 30 schemes in Siem Reap province to fine tune the data collection and entry process, resulting in establishment of standard operation procedures. Phase II of data collection, to be funded by the CDTA through WG7, cover the 1500 remaining schemes that have not previously been surveyed and entered into the data base. This phase will run into 2015 and it is recommended that continuation of this work under CDTA also be considered a priority. 12

18 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report 3. Summary of CDTA Activity A summary of CDTA activity listed in accordance with the Design and Monitoring Framework is listed below in Table 4 (Output A) and Table 5 (Output B). Table 4 OUTPUT A: Enhanced Capacity of Government to Manage Water Resources Actions/Activity this quarter and current status Actions/Activity next quarter and outlook Activity A.1: Strengthen Strategy, Policy and Legal Framework for Integrated Water Resources Management (IWRM) and Climate Change Adaption Task A.1.2 The legal framework for water resources finalized and an implementation plan adopted and launched (Links with TC1) Actions/Activity this quarter: - CDTA team supported 6 meetings of WG4 to complete the review and revision of RBM sub-decree - FWUCs sub-decree withdrawn by the Minister from CoM meeting scheduled for 21 February Meeting held with Minister and ADB consultants, Peter Logan and Pech Sokhem on 25 March agreed actions on sub-decrees and royal decree - WG4 determined that no further action is required on SDs for licensing and Water quality - Revised draft of the budget for the WG4 work plan prepared Status: - Behind schedule due to constraints to sub-decree approval Actions/Activity next quarter: - Facilitate WG4 meetings and provide technical advice in support revising the FWUCs sub-decree - Assist WG4 to minor changes to RBM sub-decree regarding composition of RB Committee, to allow for sub-level structures with each province - Prepare draft sub-decree for Secretariat office to support NCWRM - Finalize WG4 work plan and budget Outlook: - CDTA team will continue to support the legislative reform process, however stronger high-level commitment is required to accelerate progress Task A.1.3 National Water Status Report 5 (NWSR) developed and adopted. (Links with TC4) Actions/Activity this quarter: - All 10 Special Study reports are now completed including the Hydropower and the MOWRAM (Institutional) reports - Progress on the draft Indicator Report continued (90% complete by 30 April). - Drafting of the NWSR has commenced and will be comprised of four main sections: 1) water resources, 2) water for production, 3) water services and 4) water for the environment (15% complete by 30 April). Additional activities for future consideration included preparation of: - Outline plan for program to complete the National Water Actions/Activity next quarter: - Complete the Indicator Report and analyze the results as input to the draft NWSR - Finish drafting NWSR; organize WG6 meeting for midlate July - Prepare donor engagement plan, to commence in late August Outlook: - Task on schedule, activities will move from report preparation to assessment and consultation in Q2 and Q MTR agreed that this condition w ould be replaced by preparation and adoption of a National Water Status Report (NWSR) as a precursor to a full NWRP 13

19 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report Actions/Activity this quarter and current status Actions/Activity next quarter and outlook Resources Policy (NWRP) and Investment Plans - Outline plan for Monitoring and Assessment (M&A) of water resources Status: - Task remains on schedule, draft indicator report expected complete in May, draft NWSR expected complete in July Activity A.2: Improve the Coordination and Cooperation Framework for IWRM Task A.2.1 Ministerial level committee for coordination of national water resources management and an interministerial secretariat established; and coordination and cooperation mechanisms between CNMC, TSA, MOWRAM and river basin committees clarified (Links with TC2) Actions/Activity this quarter: - Draft Royal Decree (RD) revised following WG6 meeting on 28 January and submitted to Minister - RD discussed with the Minister on 25 March and subsequently revised and re-submitted Status: - RD continues to face delays, WG4 assigned to conduct MOWRAM review of the legislation Actions/Activity next quarter: - WG4 to conduct internal review of RD - Complete and approve WG6 work plan and budget Outlook: - Based on the comments from the Minister (on 25 March) there would appear to be continued support for the RD. - Assuming high-level commitment the RD will go to CoM submission this quarter Task A.2.2 Strategic plan for Tonle Sap Authority (TSA) developed Actions/Activity this quarter: - Terms of reference for consulting service to prepare TSA Strategic Plan completed Status: - Approval of WG10 work plan by MEF is still pending (submitted to MEF in Dec 13) - Actions for the preparation of the Strategic Plan are yet to commence Actions/Activity next quarter: - On approval of work plan, CDTA to support recruitment of consultant to assist development of the strategic plan - CDTA to support for initial actions relating to the strategic planning process in accordance with work plan Outlook: - Slow approval of the work plan by MEF continues to delay actions with the TSA Task A.2.3 Assist MOWRAM to establish a pilot operation of a River Basin Committee in Stung Sen 6 river basin (Links with TC5) Actions/Activity this quarter: For Stung Sen river basin: - CDTA continues to provide financial support and guidance, where sought, to the Stung Sen RBP - IOW is now also undertaking a provincial stakeholder consultation round in late May to identify key, local watershed issues - Second DP meeting for the River Basin Planning (RBP) working group held on 8 April. Next meeting scheduled for 26 May. Actions/Activity next quarter: - Continue supporting Stung Sen RBP activities where sought - Complete SEP process and finish modeling work - Prepare Information papers on monitoring and environment flows - Organize Stung Sreng RBC meeting for mid-july Outlook: - Task is generally on-track, with the Stung Sreng RB plan (and consultation) expected to be complete by December 6 CDTA supports RBP in Stung Sen River Basin via direct funding and facilitation of the Development Partner (DP) River Basin Planning (RBP) working group. In addition the CDTA has responsibility for the RBM development in the Stung Sreng river basin 14

20 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report Actions/Activity this quarter and current status For Stung Sreng river basin: - Report on Water Resource Profile of the Stung Sreng River Basin completed - CDTA held three provincial meetings in February, and a joint stakeholder meeting in April Provincial meetings focused on water availability, the irrigation sector, the environment, and local issues Joint meeting presented the Stung Sreng Water Resource Profile, and focused on confirming RBC members and chair arrangements. Meeting was chaired by NPD All meetings were well attended at all levels of government, including by Deputy Governors and District Governors. All attendees supported the RBP process, and the need for establishing water sharing rules - CDTA has commenced a stakeholder engagement process (SEP) to improve understanding of the water related concerns of local farmers, industry and domestic water users. - CDTA has commenced a modeling activity to investigate potential dry season impacts from recent development/rehabilitation investments, and options for reducing wet season floods. - Information sheets completed on Water Resource Assessment, Irrigated Agriculture and Environment Status: - Activities for the establishment of the river basin committee and development of the river basin plan are progressing well and on-track with work plan Actions/Activity next quarter and outlook - Until the sub-decree on RBM is passed, the RB committee is referred to as the Interim RB committee. The committee will only achieve official legal basis with the passage of the RBM sub-decree. Activity A.3: Strengthening capacity of MOWRAM for IWRM and CCA Task A.3.1 Water resources assessed at a nationwide scale. (Links with TC6) Actions/Activity this quarter: - Completed the National Water Resources Profile Report, including internal reviews Status: - Profile report complete Actions/Activity next quarter: - Technical meeting held on 2 May to present findings to WG6, MOWRAM Stakeholders and DPs - Request for MOWRAM approval of the Profile Report Outlook: - Task close to completion, which task achieves compliance for TC6 Task A.3.2 Improved water data management plan prepared, approved and implemented Task A.3.3 Improved plan for flood and drought forecasting system prepared, approved and implemented Actions/Activity this quarter: - Outline plan prepared for Monitoring and Assessment (M&A) program, to be considered as a future activity Outlook: - No further action is expected on these two tasks due to an acute shortage of qualified and technically skilled hydrologists, flood modelers, development planners and water management specialists in MOWRAM. 15

21 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report Actions/Activity this quarter and current status Actions/Activity next quarter and outlook Task A.3.4 Improved coordination and cooperation between MOWRAM and MOE in mainstreaming climate change adaptation (CCA) in IWRM, and vice-versa (Links with TC7) Actions/Activity this quarter: - Inter ministerial training workshop conducted with WG6 on 4 February on climate change scenarios for Cambodia and the application of the climate change database to inform planning and development decisions - WG6 formally ratified the toolkit and procedures for climate change assessment Status: - Task is complete Actions/Activity next quarter: - On-going cooperation with other programs to disseminate the climate change database and share findings of the investigation Outlook: Compliance with TC7 has been achieved through: - Application of the results from the climate change assessment into the indicator report and the water resource planning process - Application of the climate change assessment into the water resource assessment report for the Stung Sreng River Basin - Ratification of the procedures for the climate change database and toolkit by WG6 Activity A.4: Human Resources Capacity Development to Promote Integrated Water Resources Management Task A.4.1 Technical skills development tertiary level training through Institut de Technologie du Cambodge (ITC) (Links with TC8) Actions/Activity this quarter: - No action on finalizing funding arrangements while the letter of agreement (LoA) with ADB is still pending - Commenced procurement process of the equipment for computer laboratory, survey laboratory, soils laboratory, GIS software and repair of the hydraulic flume - Educational needs assessment in the water resources sector completed. The results of which support development of a post-graduate course in water resources at ITC - WG8 work plan drafted Status: - Although the first intake of 30 scholarship students into the new Water Engineering degree course was made in scholastic year , ITC are still waiting for formal LoA with ADB to establish the basis for funding of scholarships and other support for the undergraduate courses - In parallel to the support being offered by the CDTA for a post-graduate curriculum, ITC have gone ahead with establishing a Masters course in water resources. Actions/Activity next quarter: - Sign LoA and finalize funding arrangement from ADB - Complete equipment procurement - Facilitate approval of the WG8 work plan, commence implementation Outlook: - Initiation of the under-graduate and post-graduate courses in water resource engineering satisfy compliance for TC8, however the condition is not considered complete until funding arrangements with ADB are finalized 16

22 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report Table 5 OUTPUT B: Enhanced Capacity of MOWRAM to Manage and Deliver Irrigation Services Actions/activity this quarter and current status Actions/Activity next quarter and outlook Activity B.1: Strengthen Policy, Planning and Legal Framework for Irrigation Management and Service Delivery Task B.1.1 Nation-wide plan to develop financially independent FWUCs to operate and maintain irrigation schemes prepared and adopted Task B.1.2 Legal status of irrigation works reviewed and clarified by Government and rights assigned to FWUCs by end-2014 (Links with TC9) Actions/Activity this quarter: - Working with the recently re-structured WG7, activities have focused on identifying issues and constraints and raising awareness of these issues with stakeholders in MOWRAM line departments and PDWRAMs - Work plan for WG7 approved April Report on workshop of Sustainable O&M of Irrigations Schemes completed and distributed - Report on Economics of O&M of Irrigation Systems completed and distributed - Preparations for Workshop on O&M budgeting system in May 2014 Status: - FWUC department and PDWRAMs currently have no specific recurrent budget funding to carry out their role and responsibilities related to supporting FWUCs which are set out in the RGC s policy on sustainable irrigation schemes and in their departmental organizational charter - FWUC Department, IAD and PDWRAMs fully acknowledge the need for establishing financially independent FWUCs - The current missing items the plan of works and the budget will be provided as part of this task Actions/Activity next quarter: - Implement special study To prepare nation-wide plan to develop financially Independent FWUCs - The special study will include setting up the budgeting process for the FWUC Department of MOWRAM to access funds to revitalize the basic structures needed for FWUCs to operate. This includes re-establishment of FWUC functionality, establishing ongoing technical support function in PDWRAMs and establishing a process to provide financial support for newly established FWUCs. - Prepare guidelines for division of asset responsibility between the MOWRAM and water users - Support MOWRAM to assign appropriate responsibilities and rights for irrigation infrastructure to FWUCs for pilot provinces - Progress towards developing a nation-wide plan to develop financially independent FWUCs, and apply it in pilot provinces Outlook: - The FWUC sub-decree will provide the legal basis - The nation-wide plan for independent FWUCs will include funding mechanisms - Task on-track and completion expected by Dec-14 Activity B.2: Improve Organizational Structures and Administrative and Technical Capacity of MOWRAM, PDWRAMs and District Offices Task B.2.1 Plan prepared and adopted by MOWRAM to strengthen planning, budget and financial management systems in line with the public financial management reform program Task B.2.2 Management information systems for administration and finance at national, provincial, district levels (with consolidation at central level) strengthened Actions/Activity this quarter: - Recruitment procedures for specialist completed (by ADB) Status: - This activity is yet to commence, however, it is expected to proceed quickly given the linkages with the ADB Grant 0222-CAM for Public Financial Management in Rural Development (PFMRD) Actions/Activity next quarter: - International and national Financial and Accounting Specialists will commence work during the next quarter to strengthen public financial management in MOWRAM and its provincial agencies. - Prepare work plan for WG3 and facilitate approval Outlook: - Task completion expected by December

23 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report Actions/activity this quarter and current status Actions/Activity next quarter and outlook Task B.2.3 Internal links between MOWRAM s line departments strengthened for more effective water resource management and irrigation service delivery (Links with TC10) Actions/Activity this quarter: - No new progress this quarter, however it was previously reported that the CDTA consultants conducted a review of MOWRAM s organizational structure, staff resources and capacity as part of the TNA process - Cross departmental issues are addressed with joint meetings staff who are dealing with common issues, particularly from DPIC, IAD and FWUC Department Status: - TNA assessment report is complete 18 Actions/Activity next quarter: - It is proposed that as part of the NWSR, the CDTA will make an assessment of institutional arrangements for water resources management in general through consultations within MOWRAM and with other Ministries - Recommendations to be prepared for possible adjustments to existing organization structure taking into consideration new roles of MOWRAM introduced under the Program reforms Outlook: - On track, to be completed by December 2014 Task B.2.4 Linkages strengthened between Provincial Departments of Water Resources and Meteorology (PDWRAMs), district offices and Provincial Departments of Agriculture (PDAs) Actions/Activity this quarter: - No specific action this quarter Status: - This is a cross-cutting issue. De-concentration and Decentralization (D&D) of the functions of MOWRAM are lagging behind MAFF and MRD - CDTA has made some small advances in improving linkages through the conduct of regional basin planning workshops which have been well-received by provincial agencies - MOWRAM made a first step towards de-concentration of the O&M of irrigation schemes through reforming WG7 which now includes Director of Irrigated Agriculture as the Chair and the 25 Directors of PDWRAMs as vice chairs. Additionally the budget for O&M of irrigation schemes will now go to PDWRAMs (previously it went to Engineering Department) Actions/Activity next quarter: - No direct action planned this quarter, except for general support for activities aligned with D&D Outlook: - MEF is introducing program management, program budgeting and budget entities with D&D of full implementation powers to PDWRAMs in 2016 (and PDAs in 2015) - As a consequence, PDWRAMs and PDAs will be empowered to respond to issues which need strengthening of local linkages, such as river basin management, management of irrigation schemes, licensing and provision of agricultural extension services - The allocation of O&M funds to PDWRAMs will enable PDWRAMs to play their role in coordinating with other provincial and district offices as well as the Provincial Governor s office. In particular, linkages with PDAs will be able to be strengthened Task B.2.5 Gender mainstreaming unit created in MOWRAM with appropriate resources and staffing (recruitment target 20% women) Actions/Activity this quarter: - Work plan for WG2 approved February Detailed implementation schedule prepared for initial activities under the work plan - Gender Mainstreaming Action Plan printed and distributed Status: - Activities delayed pending release of funds via the MOWRAM bank account. The account is yet to receive approval from MEF Actions/Activity next quarter: According to the work plan, activities will include: - Forum on Women in Water Resources Sector - Workshop on Gender Mainstreaming - Meetings in Phnom Penh (WG2 & Gender Focal Points from 24 provinces) - FWUC training on gender awareness - Survey on gender roles and issues in water sector - Implement gender database in MOWRAM - Publication of gender materials Outlook: - WG2 have demonstrated that they are highly motivated and receive strong support within MOWRAM. Activities are expected to accelerate significantly once funding issues are resolved

24 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report Actions/activity this quarter and current status Actions/Activity next quarter and outlook Activity B.3: Strengthen MOWRAM's ability to manage, operate and maintain irrigation systems Task B.3.1 Comprehensive irrigation O&M plan for MOWRAM prepared, adopted and implemented Task B.3.3 Sustainable funding mechanism for O&M established in MOWRAM (Links with TC11) Actions/Activity this quarter: - Commenced special study to support MOWRAM and PDWRAMs to prepare a 3-year Budget Strategic Plan (BSP) for O&M of Irrigation Schemes. Commencing in the pilot provinces (Banteay Meanchey, Siem Reap, and Kampong Thom) the specialist consultant has worked closely with IAD and the CDTA team to conduct fieldwork and draft a practice manual for prioritization and selection of irrigation schemes and estimating O&M requirements. The activity has received strong support and IAD are duplicating the program with their own resources to roll-out BSPs in all remaining provinces in the country - Consultation with MEF confirms that there is a specifically allocated $30m fund for O&M of irrigation schemes, which can be accessed through a structured BSP process - Working with WG7 and the Irrigation Services Program Unit (ISPU), the CDTA consultants have drafted O&M Budget Request Guidelines (which is Part 2 of the Manual and Guidelines for O&M of Irrigation Schemes 7 ) incorporating the principles of O&M as well as standard operating procedures for MOWRAM to obtain regular budget allocations for routine and periodic O&M. - Working WG7 and the ISPU, the CDTA consultants have finalized the Strategy and Work Plan to Complete Development and Ensure Sustainability of Irrigation Systems. This strategy will be implemented through the work plan of WG7. Status: - Progress on this task exceeds expectations, with very strong uptake from MOWRAM and the PDWRAMs, as demonstrated by their desire to roll-out nation-wide BSP processed in parallel to the pilot activities Actions/Activity next quarter: Next quarter activities will include - Training workshops both in Phnom Penh and in regional centers to roll-out training of BSP practices - The CDTA will support training of trainers in IAD who will be responsible for support the budget planning the PDWRAMs - Budget plans need to be submitted in June for MOWRAM review and then submitted to MEF by the end of June Support will be offered to MOWRAM and MEF for the establishment of inter-ministerial committee for Infrastructure Investment and O&M for Irrigation Schemes. (MEF have similar inter-ministerial committees with Ministry of Public Works and Transport, MPWT and Ministry of Rural Development, MRD) - Drafting of Parts 1, 3, 4 of the Manual and Guidelines for O&M of Irrigation Schemes Outlook: - This activity is progressing well on several fronts and will have a significant role in a wider-ranging reform process for O&M with implications for MOWRAM, PDWRAMs and FWUCs. - Activity is on-track for substantial completion in the next quarter - This activity provides the foundation for Task B1.1 Task B.3.2 MOWRAM s asset management system for irrigation systems adopted and operationalized Actions/Activity this quarter: - Following from the pilot survey of 30 schemes for CISIS data collection entry, preparations are ongoing for Phase II of CISIS data collection, commencing with a Actions/Activity next quarter: - Complete procurement and commence package P1 for CISIS data collection - Complete hardware purchases for DPIC and four 7 The Comprehensive Irrigation O&M Plan is renamed the Manual and Guidelines for Operation and Maintenance of Irrigation Schemes. This manual has 4 parts: Part 1; Policy on Repair, Operation and Maintenance of Irrigation Schemes, Part 2; O&M Budget Request Guidelines, Part 3; O&M Expenditure Guidelines, Part 4; Technical Procedures for Repair and Maintenance. 19

25 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report Actions/activity this quarter and current status first package of approximately 150 schemes to be funded as a variation of the Egis contract - The remainder of Phase II will roll-out with a staged twoyear program managed by DPIC and funded via the APF. - Upgrades to the CISIS database structure and the interface modules continue, including documentation of the GIS interface and translation of forms to Khmer Status: - The CISIS data collection program is slightly behind schedule, however efforts are being made to accelerate procurement - There is some risk of further delay in field work due to the onset of the wet season Actions/Activity next quarter and outlook provinces - Complete translation to Khmer of data collection forms - Prepare a Khmer-English glossary of technical terms for use by field staff - Define the sequence of subsequent packages and commence procurement procedures via the APF Outlook: - The CISIS roll-out to accelerate in the coming months and the program will follow a tried and tested procedure. Other than the difficulties due to bad weather, few constraints are expected. Activity B.4: Develop Human Resources Capacity to Manage, Operate and Maintain Irrigation Systems (Government and FWUCs) Task B.4.1 Human resources development (HRD) plans developed for MOWRAM, PDWRAMs, district offices and FWUCs Task B.4.2 Technical skills developed through vocational training courses under MOWRAM's Technical Services Centre (TSC) Task B.4.3 Capacity of FWUCs and PDWRAMs enhanced through vocational and on-the-job training (Links with TC12) Actions/Activity this quarter: - TORs completed for training contracts for course for the MOWRAM-PDWRAMS and the 33 FWUCS will be completed - Previously, it was reported that completed work includes (i) TNA report and training plan for MOWRAM and five PDWRAMs), (ii) TNA report and training plan for 33 FWUCs, (iii) training courses on climate change, gender, CISIS and IWRM, and (iv) draft work plan for the WG5. - Detailed proposals have been for a range of options for costs, durations and the composition of the groups (particularly for the 33 FWUCS). Status: - Training program is behind schedule this quarter and additional resources will be applied to accelerate progress in the coming quarter Actions/Activity next quarter: - Complete HRD plan and submit for review - Complete contracting arrangements for TSC training schedule - Commence procurement for external training packages - Complete and facilitate approval of WG5 work plan Outlook: - Currently at the early stages of two-rolling plan for training within MOWRAM, PDWRAMs and FWUCs - Acceleration of the program in the coming quarter will aim to get back on track with regard to the program work plan 20

26 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report 4. Operation and Management Issues 4.1 Commitment of CDTA funds An estimate is made of the total CDTA fund (in Table 6) and the current commitment on the available CDTA funds (in Table 7). The assessment is a best guess based on currently available information. In particular, the total amount of CDTA funds in work plans and special contracts to be administered by the Working Groups is likely to change. The current estimate contains accurate information from the approved work plans for WG2, WG7 and WG10 combined with preliminary estimates for the other Working Groups. The objective of showing this information is to allow for informed discussion of options for utilization of the remaining un-committed funds. Table 7 indicates that approximately $1.28 million of the CDTA fund remains unallocated. Available CDTA funds Table 6: Estimated CDTA funds Estimated Amount (USD) ADB (TA fund) 1,000,000 Australia Aid, 5 million AUD (at 0.91 AUD/USD) 4,550,000 NDF, 3 million Euro (at 1.35 Euro/USD) 4,050,000 Total estimated CDTA fund (donor only) 9,600,000 Table 7: Estimated funds committed Estimate of committed funds Amount (USD) CDTA funds in work plans and special contracts 4,119,468 Egis contract 3,780,000 International Water Resources Planner (ADB) 250,000 International Staff Consultants (ADB) 120,000 Funds for IOW for Stung Sen RB planning 50,000 Total estimate of committed CDTA funds 8,319,468 Balance in CDTA funds (estimated) 1,280, Program staffing The CDTA team from the consulting firm Egis International and Key Consultants (Cambodia) was mobilized in January 2012 with a 3-year contract which is scheduled to be completed in January The initial contract included 84 person-months of international consultants and 192 personmonths of national consultants, which was subsequently revised to 103 person-months of 21

27 Egis International CDTA 7610-CAM: Ninth Quarterly Progress Report international consultants and 265 person-months of national consultants with variations #9 and #10 in Quarter 8. During Quarter 9, two international staff (Climate Change Adaptation Specialist, Mr Ramon Abracosa) and the (Training Specialist in Water Resources, Mr Vincent David) and one national staff (National Climate Change Adaptation Specialist, Mr Taing Sophanara) completed their contracted inputs. The International Economist, Mr Ruud Corsel resigned from the program effective from 14 March To that point he had used 7.06 of his 9 months leaving a balance of 1.94 months. Two variations were approved by during the quarter. Variation #11 requested: Transfer of two days from Field based working days to Home Office based working days for the international Climate Change Adaptation Specialist, Ramon Abracosa Transfer of ten days each from Field based working days to Home Office based working days for the international Policy and Institutional Specialist, Des Cleary and the International Irrigation specialist, Doug Flanders. Variation #12 requested: 2.5 person months of additional time allocated to Program Team Leader/Water Resource Specialist, Ian Wood Reduction of the remaining time of the International Economist, Ruud CORSEL, by 1.94 person months. Use of out-of-expense budget lines in order to partially cover for additional time required for the Program Team Leader / Water Resource Specialist. Both variations resulted in no net change in contract value or person months. The utilization of CDTA consultant resources to 30 April 2014 reached 84.4% of international and 79.7% of national inputs, as shown in Table 8. The Personnel Schedule for expected inputs from team members until the end of the program is shown in Table Outputs this Quarter and Knowledge Products The following technical reports were issued from the CDTA office this quarter Report on the Workshop on Sustainable Operations and Maintenance of Irrigation Schemes Report on Economics of Operation and Maintenance of Irrigation Schemes Strategy and Work Plan to Complete Development and Ensure Sustainability of Irrigation Schemes Stung Sreng River Basin Profile Report National Water Profile Report The full list of knowledge products for the program to date is shown in Attachment F. A WRMSDP website is currently being developed under Component C of the program. It is expected that these knowledge products will uploaded to the website for broader access. 22

28 Table 8: Utilization of Consultant Inputs on CDTA 7610-CAM (30 April 2014) Name of Expert 2012 Jan Fe b Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar (month) Apr May Jun Jul Aug Se p Oct Nov Dec Jan Feb Mar Apr (month) Contract Allocated a Remai ning (month) International Ian B. FOX/ Ian WOOD Des CLEARY Ramon ABRACOSA Jean-Marc ROUSSEL A. K OSTER / Doug FLANDERS Gregory D. REGAN Vincent DAVID K. D. W. NANDALAL L. VANDOME / Ruud CORSEL Total % National SAM Chhomsangha SOK Saing Im KHUON Komar TAING Sophanara TES Sopharith TAK Virekvath HOUT Savorn LIM Heng HAP Navy CHEAP Samoeurn HENG Meng CHAN Vannak SOK Bun Heng TOCH Bonvongsar/ MONICOTH So Im Total % a In accordance with the reallocation/addition of person- months approved by ADB in Contrac t Variations 1 through 10 Total Used % 23

29 Table 9: Personnel Schedule CDTA 7610-CAM (30 April 2014) NO. NAME POSITION INTERNATIONAL 1 Ian WOOD Program Team Leader/Water Resources Specialist 2 Des CLEARY Policy and Institutional Specialist 3 Ramon ABRACOSA Clim ate Change Adaptation Specialist 4 Jean-Marc ROUSSEL Hydro-Meteorologis t 5 Do ug FLANDERS Irrigation Specialis t 6 Gregory REGAN IT / Data Management Specialis t 7 Vincent DAVID Training Specialis t in Water Resources 8 K.D.W. NANDALAL Education Specialist 9 Ruud CORSEL Economis t Months Remaining NATIONAL SUB-TOTAL 11 SAM Chhoms angha Deputy Program Team Leader 12 SOK Saing Im Water Resources Specialist 13 KHUON Komar Policy and Institutional Specialist 14 TAING Sophanara 15 TES Sopharith Hydro-meteorologist 16 TAK Virekvath Irrigation Specialis t 17 HOUT Savorn IT / GIS & Data Management Specialis t 18 LIM Heng Legal Specialist 19 HAP Navy Gender Specialist 20 CHEAP Samoeurn Training Specialis t in Water Resources HENG Meng CHAN Vannak 23 SOK Bun Heng Clim ate Change Adaptation Specialist Education Specialist Economis t River Basin Planner (1) 24 MONICOTH So Im River Basin Planner (2) 9.47 SUB-TOTAL

30 Attachment A Water Resource Management Advisor (Peter Logan) Mission Report (16-18 May 2014)

31 Water Resources Management Sector Development Program (WRMSDP) ADB Loan CAM and TA CAM Water Resources Management Advisor Mission Report March 2014 A. Introduction 1. The Water Resources Management (WRM) Advisor, Peter Logan, has been engaged by ADB under the capacity development technical assistance (CDTA CAM) which is assisting MOWRAM with the implementation of the program component of WRMSDP. The TOR require the WRM Advisor to assist the National Program Director (NPD), HE Veng Sakhon, Secretary of State of MOWRAM, and the CDTA team, to implement the Program. The contract provides about 2 months of intermittent input between August 2013 and March The emphasis of the assignment is to assist activities needed to achieve compliance of 12 conditions required for release of the 2 nd tranche (T2) of the program Loan 2673 under WRMSDP. The original deadline for release of T2 was June 2013, but following ADB s midterm review mission in April- May 2013, Loan 2673 has been extended to June 2015 on the basis that the T2 conditions will be meet by the end Purpose of this Mission: The Mission was fielded at the request of the CDTA and NPD, especially in view of difficulties being encountered with key T2 conditions (#1 and #2) involving passage through the Council of Ministers (CoM) of 4 sub- decrees and a royal decree. During the last ADB review Mission in December 2013, the target date set for submission of these for CoM consideration was 31 January However, now 2 months beyond that date, only one has been submitted but it was withdrawn before the scheduled discussion date, and the others have not yet been presented. With uncertainties regarding next steps, a priority during this mission was to discuss and seek guidance of the Minister MOWRAM on how this work should proceed. The WRM Advisor and Governance Advisor were able to meet the Minister on 25 March 2014, and the draft minutes of the meeting are in Attachment 1. Other notes on key meetings are in Attachment 2. B. Tranche 2 Conditions Outline of Recent Progress (during Q1 2014) 3. Following the ADB review mission in December 2013, there was an escalation of Program activities, and an improvement in the outlook for achieving key T2 condition. Working group WG4 responsible for the 4 sub- decrees was reactivated after a long period of dormancy, and the inter- ministerial WG6 met to complete and ratify the draft Royal Decree needed to establish the National Council for Water Resources Management (NCWRM). However, since late February 2014, some uncertainties have affected progress on T2 condition #1 and #2 (see below). Nevertheless, other activities are generally progressing positively. Table 1 below presents a brief summary of progress towards compliance of the 12 conditions required for release of the $10 million 2 nd tranche of the program loan. 1

32 Table 1: Summary Status of Compliance for Tranche 2 Conditions (as of 28 March 2014) Program Tranche 2 (T2) Condition (annotated) #1: Passage of 4 sub- decree: Farmer Water User Committee (FWUC), river basin management, water licensing, water quality #2. Establish a National Council for Water Resources Management (NCWRM) chaired Prime Minister (by Royal Decree), and set up an inter- ministerial secretariat to support the NCWRM. #3. NCWRM to issue a policy for coordination and cooperation between National Mekong Committee, Tonle Sap Authority, MOWRAM, and river basin committees #4. NCWRM to commission a review of national water resources plan (NWRP) and issues. Brief Description of Progress in Q / Revised Estimate of Compliance FWUC sub- decree; it was on the Council of Ministers (CoM) meeting agenda for consideration on 21 Feb 14, but withdrawn at the last minute due to proposed irrigation fees (in Article 35) being political sensitive. To avoid long delays in further consideration of this sub- decree, the Minister agreed (meeting 25 March 2014) for WG4 to review and consider possible revisions to Article 35, although a schedule for this to proceed still needs to be confirmed. Other 3 sub- decrees: In January 2014, the Minister asked WG4 to review the existing drafts. WG4 has worked intensively to refine the RB sub- decree, and decided that the current drafts of the other 2 do not need revision. The review is expected to be completed and reported back to the Minister by the end of March If considered acceptable, it may be possible to have the drafts ready for CoM consideration in May Estimated Compliance: uncertain, unlikely before Oct 2014 (ie. at least 4 mth slippage since Dec 13 Mission). The draft Royal Decree to establish the NCWRM was reviewed & revised by WG6 in January The revised draft was immediately submitted to the Minister. During the meeting 25 March the Minister advised he supports the RD but asked that the Governance Advisor /WG6 consider revisions to ensure consistency with the Water Law. This is now underway and likely to be completed in early April 2014, after which the Minister will make a decision regarding submission for CoM consideration. Estimated Compliance: uncertain, unlikely before Q (at least ~3 mth slippage since Dec 13 Mission). It was agreed during the May 2013 Mid- term Review (MTR) to make an assessment as to whether the coordination & cooperation policy is still needed, given that all of these entities are now headed by the Minister MOWRAM. No recent action taken; the assessment is considered lower priority than the more critical T2 condition. Estimated Compliance: Q MTR agreed that this condition would be replaced by preparation and adoption of a National Water Status Report (NWSR) as a precursor to a full NWRP. Preparation of the draft NWSR is making good progress and a draft for circulation to stakeholders will be ready by June The subsequent inter- ministerial review & approval process is expected to take 6 months. Estimated Compliance: end Q on track, no major issues. #5. Establish Stung Sen* river basin committee (RBC). [*Note: MTR agreed the CDTA would switch to Stung Sreng instead, since the Tonle Sap Authority (TSA) has taken over this There has been good progress with S. Sreng RB work. A Water Resource Profile Report on the Basin was completed in March There have been 2 rounds of consultations with provincial stakeholders that generated strong interest, particularly on concerns about water resource sharing. The first meeting of the S. Sreng RBC is scheduled for 3 April 2014 chaired by NPD, with the 3 provincial Governors also attending. Note the RBC cannot be formally established until the RB sub- decree is passed and is therefore proceeding as a pilot on the basis of 2

33 Program Tranche 2 (T2) Condition (annotated) role in Stung Sen in corporation with French Water Agencies.] #6. Prepare and approve a national water resources profile #7. Mainstream IWRM climate change adaption #8. Develop technical skills at Institute of Technology of Cambodia (ITC) #9. Adopt guidelines for legal status of irrigation works, including rights /responsibilities of FWUCs #10. Strengthen MOWRAM s internal linkages between line departments Brief Description of Progress in Q / Revised Estimate of Compliance stakeholder consensus. To facilitate knowledge sharing /coordination of all ongoing RB work, the CDTA lead the establishment of a Donor WG covering S. Sen & Sreng + 6 others being supported by JICA. Estimated Compliance: Q on track, no major issues. Profile Report has been circulated for wider review and completed based on feedback. The CDTA is undertaking a final review and expect to submit it to MOWRAM for final approval in early April Estimated Compliance: April Assessment of climate change vulnerability is completed and toolkit /procedures for MoE & MOWRAM staff to use are prepared. Ratification of these by WG6 was confirmed in February 2014, (as per MTR agreement), and staff training was also completed, thus fulfilling the conditions for compliance agreed during the MTR. Complied February 2014 With ADB s concurrence, scholarships for degree courses commenced with 2 intakes (2011 & 2012), each of 30 students. They are to be funded from the CDTA, but no fund flow mechanism is in place as yet. ITC opted not to formalize an intake in 2013, but will select students when funding is confirmed. In the meantime the students themselves are pre- funding the promised scholarships. A contract was signed in Feb 2013 between MOWRAM and ITC which outlines the activities and costs involved. It was originally meant to be the basis for flow of CDTA funds, but the contract could not be endorsed by ADB. Subsequently ADB proposed to fund the work via a Letter of Agreement (LoA). At the Dec 2013 mission, ADB undertook to conclude the LoA by 31 January 2014, but since this is still pending, it remains uncertain whether an appropriate solutions can be concluded. Estimated Compliance: uncertain, pending ADB clearance of the LoA Delay in approval of the FWUC sub- decree is a set back to establishing a legal basis for rights and responsibilities. However, there are existing guidelines that are being followed, including in the Project Area, for activating FWUCs in the management of their systems. Recent initiatives that are getting underway to improve O&M of irrigation schemes (see #11 below) are closely linked; they will improve service delivery through building capacity of PDWRAMs and providing assured funding for routine and periodic O&M. With a more reliable service, FWUCs will be motivated to function effectively. Estimated Compliance: Q4 2014, but some uncertainty pending passage of the FWUC sub- decree The CDTA has completed a review of staff resources in MOWRAM. It is proposed that the CDTA will make an assessment of MOWRAM s organizational structure later in 2014 through consultations with relevant staff. Recommended changes will be submitted to WG5 for consideration. There has been no recent action. Estimated Compliance: Q

34 Program Tranche 2 (T2) Condition (annotated) #11. Strengthen MOWRAM s O&M planning processes #12. Develop technical skills (vocational training) Brief Description of Progress in Q / Revised Estimate of Compliance Funding and capacity to deliver routine or periodic O&M services is extremely low. However, there have been recent important initiatives to rectify this, all well- supported supported in MEF and MOWRAM. A draft strategy for completing irrigation systems was prepared; a 2- day national workshop on Sustainable O&M was successfully held in Jan 2014; MEF and MOWRAM are in the process of establishing a Inter- Ministerial Committee on Infrastructure Investment and O&M for Irrigation Schemes; an O&M Policy & Implementation Manual is under preparation; an O&M Budget Strategic Plan is being prepared at the request of MEF /MOWRAM. The CDTA has been asked to take a lead role in assisting with this evolving work. Activities are supported through the WG7 work plan for which MEF approval is pending. Estimated Completion: Q on track. Training needs and plans have been prepared and courses for climate change, gender, CISIS, and IWRM have been prepared for MOWRAM, 5 PDWRAMs, and 33 FWUCs. The CDTA will work in consultation with TSC and JICA to prepare draft contracts with a view to commencing training by about mid 2014, subject to acceptance & approvals. Estimated Compliance: Q (when training contracts are commenced). CoM = Council of Ministers; NCWRM = National Council for Water Resources Management (to be established) 4. Schedule for Compliance of T2 conditions: The assessment summarized in Table 1 shows that only 2 of the 12 conditions are (or are close to) complying. Of the remaining 10 conditions, 6 are so far proceeding according to expectations and likely to achieve compliance by the end of 2014 in line with compliance dates estimated during the ADB review mission in December For the remaining 4 conditions (#1, #2, #8 and #9), developments during Q have caused uncertainty on the likely compliance schedule. Three of these involve legislation and hence depend on high- level decision- making, and therefore working level staff have limited control on progress. It is concerning that there has been slippage in meeting target dates set during the December 2013 Mission. Actions need to be quickly reactivated to achieve substantial compliance by the end of Passage of Sub- decrees & Royal Decree: Despite uncertainties that have crept in over the last few weeks, the meeting with the Minister on 25 March 2014 indicates that passage of the 4 sub- decrees and the Royal Decree are still well supported by MOWRAM. Nevertheless it is acknowledged that there may be difficulties with at least 2 of the sub- decrees due to political sensitivities (Attachment 1). It is worth noting that events in the last couple of months have once again highlight the challenges associated with legislative reforms, with decisions and related activities dictated at high level of the Government. For example, the draft FWUC sub- decree has been under constant discussion for about 7 years, and the CoM considered it on 4 occasions during 2012 without passing it. The decision to withdraw it from the CoM agenda in February 2014 has cast further doubt on whether it is likely to be passed anytime soon. On the River Basin sub- decree, with WG4 given the opportunity to review and revise it, the time and 4

35 concerted effort that all concerned staff have contributed to this task (involving only a revision of 1 sub- decree) since January 2014 is testament to the enormity of the task involved to reach compliance of just T2 condition #1 and #2. C. Key Issues & Proposed Action 6. FWUC Sub- decree: Since February 2014 progress has been stalled. However, following discussions with the Minister (Minutes Attachment 1), it is hoped that WG4 and others will be given the opportunity to review the current draft, particularly Article 35 which is the formula for the Irrigation Service Fee (ISF). This would present the opportunity to explore the practicalities of a more flexible approach. Every irrigation system is different, and every FWUC is different, so it would beneficial, if for example, an "O&M Sharing Arrangement" (instead of ISF) for each scheme could be worked out through consultation and mutual agreement of MOWRAM /PDWRAM and the FWUC. This would allow FWUCs to have a say, have ownership of the arrangements, and avoid the risk of the FWUCs losing interest by having a formula imposed on them that might not be well suited to needs. There is the added advantage of moving away from the politically sensitive notion of a "fee" being imposed on poor farmers, and that O&M does indeed require a team effort. There is ample evidence that farmers will readily pay their share if there is good service (eg, private schemes already operating in Cambodia). If practical revisions of the sub- decree along these lines can be developed, it has the potential to enhance the effectiveness, as well as reducing risk of delayed passage. 7. Revised Water Policy & National Water Plan: Under T2 condition #4, it was agreed during the MTR that it is realistic to complete of the National Water Status Report (NWSR) by the end of 2014 to trigger compliance with condition #4. The NWSR is considered a necessary precursor for a review and updating of the Water Policy, and then the preparation of a full National Water Plan. Both of these activities would be lead by MOWRAM, but will require comprehensive consultations with all agencies involved in the water sector. It would be preferable if the work follows on immediately after the NWSR is finalized (beginning in 2015), but at this stage there is no confirmed funding. To avoid a hiatus and the risk of this important work loosing momentum, it is recommended that ADB in consultation with MOWRAM consider the possibility of utilizing CDTA funds that are currently unallocated. It is suggested that the CDTA team should prepare a schedule and an estimate of resources needed to undertake the work so this can be considered later in 2014 along with other priorities for follow- on work that might be funded under the CDTA. 8. Hydrological Data: Preparation of the NWSR and the Stung Sreng Water Resources Profile has highlighted the lack of hydrological data throughout Cambodia. While there are reasonable rainfall records generally spanning 20 years or so, there is very little river gauging records to accurately quantify surface water. Estimates have been made, although it is understood that these are extrapolated from very sparse stream flow data using the available rainfall records. It means that there is low confidence in the current estimates of available surface water. As demand and investments increases, comprehensive and accurate water availability data is crucial for optimizing water and river basin management. In addition, good 5

36 data is an essential precursor to optimizing the economic efficiency of investments, and hence should be regarded as an important national asset. Since there is currently limited investment in a national hydrological monitoring system, it would be worthwhile to explore opportunities when planning future projects. 1 For example, this might be considered for inclusion in future ADB- funded projects in the pipeline. 9. Irrigation O&M: There is still a lot to be done to establish sustainable O&M in Cambodia; until now MOWRAM has allocated almost no resources for this, and PDWRAMs have limited capacity, so it is starting from a low base. On the other hand there has been encouraging developments over the last 3-4 month that appear to be well supported by MOWRAM and MEF (see Table 1, #11). The recent study tour of MEF and MOWRAM staff to Australia sponsored by the Australian Government without doubt has contributed to the current levels of enthusiasm. 10. WG7 was newly constituted in December 2013 is now very active and taking a strong lead in the reforms. It has established a close working relationship with the CDTA specialists, and ramped up the intensity of technical support it seeks from them. The CDTA is currently assisting WG7 to prepare an O&M Budget Strategic Plan that is of particular importance and urgency. This will be followed by a range of much needed activities, such as development of an expenditure management system for O&M, plans for staffing needs, funding for FWUC, etc. It is hugely encouraging that the momentum for policy reforms in irrigation O&M is finally commencing. Hence there is now the opportunity to build on this momentum, but at the same recognizing that these types of reforms take years to implement. In consultation with WG7, the CDTA has assisted to prepare a detailed implementation schedule covering to the end of It is therefore recommended that continuation of support for this work under the CDTA during 2015 also be considered as a priority. 11. Irrigation Development: MOWRAM s Strategic Development Plan ( ) provides details of the investment budget. It shows that the confirmed budget is about $250- $300 million per year for the next 5 years (see summary illustration in Attachment 3). Most of it (83%) is for irrigation, and dams (13%). Only 12% is national funding, with the remainder provided by development partners. The People s Republic of China provides about half, and Korea about a quarter, and the remainder from a number of other development partners. This sizable investment means that substantial areas of new and rehabilitated irrigation areas will be coming on line in the coming years, and highlights need to ramp up the effectiveness of O&M. The Economics of O&M of Irrigation Systems Report (February 2014) prepared by the CDTA clearly illustrates that if adequate attention is not given to scheme management and O&M, there is high risk that economic benefits will be small or even negative. As mentioned in para 9, current capacity and funding for O&M is still low, and implementation of more effective procedures are still at an early stage. This therefore signals for some degree of caution in running ahead too quickly with new and rehabilitation irrigation areas without provision of 1 UNDP is scheduled to commence a $5 million program to Strengthening climate information and early warning systems in Cambodia to support climate resilience which includes strengthen hydrological monitoring. 6

37 robust O&M. Such investments need to be balanced with additional resources for recurrent scheme management and O&M. D. Concluding Comments 12. At the conclusion of the WRM Advisor s mission, there is cautious optimism for continuing progress towards substantial compliance of T2 conditions of the Program Loan. Following the meeting with the Minister MOWRAM on 25 March 2014, it is encouraging to note that conditions #1 and #2 involving the sub- decrees and Royal Decree for NCWRM are still well supported by MOWRAM. Achieving passage of these through the CoM will depend heavily on the continued strong support of the Minister, but even then, it is recognized these types of legislative reforms are open to political sensitivities and therefore have potential for delays and obstacles. 13. As agreed during the MTR, the Program Loan has been extended by 2 years to June 2015 to allow 6 months to process the tranche release after compliance is achieved at the end of So with 9 months remaining, it is reasonable to say that substantial compliance of T2 conditions by the end of 2014 is still possible. Of the 12 conditions, at least 8 appear to be on track, but as reflected in Table 1, there is persisting uncertainty with 4 of the conditions (#1, #2, #8 and #9). Unless there is clear- cut positive progress on these during the next 3 to 4 months, we are facing the prospect of a either a further loan extension, or possibly the risk of ADB cancelling the loan if there is reluctance to an extension. 7

38 Attachment 2: Notes on Key Meetings HE Veng Sakhon, National Program Director (NPD) with P Logan (PL) and Ian Wood (IW) Tuesday 18 March 2014 Firstly it was clarified that the schedule for PL and Pech Sokhem (PS) to meet Minister MOWRAM is awaiting confirmation, but tentatively scheduled for 20 March. On T2 condition #1, the FWUC sub- decree, NPD confirmed that at the request of the Council of Ministers (CoM), the draft FWUC sub- decree (the same version that was submitted to the Minister in 2012) was on the agenda for discussion by a full meeting of the CoM on 21 February. However, it was withdrawn by MOWRAM at the last minute. The reason is understood to be a result of political sensitivities relating to imposing the burden of fees for irrigation on farmers. There has been no subsequent action on the FWUC sub- decree since then, awaiting guidance from the Minister. It was suggested that this issue could be raised by PL during the proposed meeting on 20 March. On the other 3x sub- decrees under T2 condition #1 (River Basin, Licensing, Water Quality) in January 2014, the Minister requested the responsible Working Group 4 (WG4) to review the existing drafts. WG4 is actively undertaking a detailed review of the River Basin sub- decree (ongoing, 6 half day meetings to date), but it is understood that WG4 has decided that changes to the other 2 are not necessary at this stage. NPD was uncertain about possible schedules for these 3 sub- decrees to be submitted to CoM for consideration (hence another agenda item for the meeting with Minister). On T2 condition #2, it was confirmed that during January 2014, the draft Royal Degree (RD) for creation of the National Council for Water Resources Management (NCWRM) was reviewed and revised by WG6. It was then submitted to the Minister by NPD, but there has been no feedback since, and it is not clear if there is any schedule or intention for the RD to be submitted for CoM consideration in the near future (hence another item for PL to raise with Minister) Advance Payment Facility (APF); the related request for MOWRAM s authority to open an account was submitted to MEF about one month ago, but is pending. NPD indicated the delay is most likely logistical (rather than conceptual) due to departmental restructuring with MEF at the moment. It is expected this will be resolved shortly. HE Nei Lorn, U/SS, Chair of WG4 (for sub- decrees under T2 condition #1) PL and CDTA team 19 March 2014 In Dec 2013 MOWRAM requested the CoM to schedule consideration of the FWUC sub- decree in a full meeting of the CoM; on 18 Feb 2014, CoM confirmed it was on the agenda for 21 February However, after an official communication with the Prime Minister, it was withdrawn before hand, apparently due to political sensitivities. Since then there has been no further guidance from the Minister regarding next steps. HE Nei Lorn confirmed that the current draft of the FWUC sub- decree is the same as the one that was considered by the technical group of CoM in December Although that group recommended modifying Article 35 of the draft (relating to the formula for charging irrigation service fees to FWUCs), the Minister MOWRAM at the time considered it necessary to retain the clause as is. Accordingly, further consideration of the sub- decree was deferred until after the National Elections. However, it appears that Article 35 remains politically sensitive. Hence, it was 9

39 suggested that PL discuss with the Minister the possibility of authorizing WG4 to undertake a review of the current draft with a view to incorporating revisions that would be more politically acceptable without significant compromise to the effectiveness of the sub- decree. River Basin sub- decree; WG4 have now had 6 intensive meetings (1 x ½ day, 1 full day) to discuss and refine it. A revised draft is expected to be reported to Minister by the end of March 2014, and if found generally acceptable a draft could be ready for submission for CoM consideration during May Licensing & Water Quality sub- decrees; confirmed that WG4 has decided that the current drafts do not need revision, and these will be submitted back to the Minister as is with the revised RB sub- decree. 10

40 Attachment 3 27/03/14 MOWRAM Strategic Development Plan MOWRAM Strategic Development Plan Note: includes projects in process and agreed 1

41 Attachment B Minutes of Meeting with HE Lim Kean Hor, Minister of MOWRAM, 25 March 2014

42 Water Resources Management Sector Development Program (WRMSDP) ADB Loan 2673-CAM and TA 7610-CAM MINUTES OF MEETING (Draft) Subject: Progress toward compliance with Loan 2 nd Tranche Conditions Date /Location: 9.00 am, 25 March 2014, MOWRAM Conference Room Attended by: H.E. Lim Kean Hor, Minister, MOWRAM HE. Bun Hean, Secretary of State, MOWRAM HE. Ponh Sachak, Director General, MOWRAM HE. Chan Youtha, Auditor General, Director of Cabinet of Minister, MOWRAM Chief of Cabinet of Minister, MOWRAM Dr. Pech Sokhem, Governance Advisor to TA7610 Peter Logan, Water Resources Management Advisor to TA7610 The meeting was requested to discuss compliance progress of 2 nd Tranche (T2) Conditions under the Program Loan 2673, and seek HE Minister s guidance regarding the appropriate next steps. The meeting focused on T2 condition #1 involving 4 sub-decrees, and condition #2 involving a Royal Decree to establish a National Council for Water Resources Management (NCWRM), all requiring consideration and passage through the Council of Ministers (CoM). The key discussion points and decisions of the meeting are: 1. FWUC sub-decree: HE Minister explained that after consulting the Prime Minister, it was withdrawn in February 2014 from the agenda of CoM meeting because some aspects of the current draft were considered politically sensitive. The main issue is Article 35 relating to the detailed formula for Irrigation Service Fees cost sharing. If left as it is, the Minister indicated it might be at least 2015 before it would be possible to consider resubmitting the draft sub-decree to the CoM for consideration. Agreement: To avoid delays, HE Minister agreed to request Working Group 4 (WG4) to revisit Article 35 and determine if appropriate revision could be introduced that would be acceptable in the current political climate, without compromising the effectiveness of the sub-decree. Any revisions proposed by WG4 would need to be carefully considered before making a decision on whether the sub-decree could be resubmitted to the CoM in the near future. 2. River Basin, Water Quality, and Licensing Sub-decrees: It was acknowledged that WG4 has worked very hard since January 2014 to review these 3 sub-decrees. As a result, the River Basin sub-decree is being revised through extensive discussions; revisions are almost completed. It was decided the current drafts of the other 2 sub-decrees did not need to be revised. WG4 will report the outcome of the review to HE Minister by the end March Agreement: As soon as WG4 reports, HE Minister agreed to lead an internal review and finalization of the 3 sub-decrees, and submit them for consideration of the CoM by end May It was acknowledged that the Licensing Sub-decree may prove to be sensitive, so passage through the CoM might be more problematic than for the other 2 sub-decrees. 3. NCWRM (through Royal Decree): HE Minister advised that he has reviewed the draft Royal Decree for establishment of the NCWRM submitted after WG6 review in January 2014, and supports this in principle. However, with reference to the Water Law Articles 4 & 5, HE raised concerns about consistency and indicated that some refinements need to be considered. Agreement: HE Minister agreed that Governance Advisor (Dr Pech Sokhem) should review and recommend appropriate modifications to address the concerns and discuss these with WG6. The draft Royal Decree should be refined accordingly and resubmitted to HE Minister for consideration. 1

43 Attachment C Cambodian National Water Reform Pathway

44 Cambodian National Water Reform pathway National Water Status Report (Baseline) National Water Resource Policy NWRP Implementation Plan NWRP Investment Plan Key areas: Key aspects: Key aspects: Key aspects: Water Resources Surface water, groundwater, water quality Key issues (~10) Water Services Rural and urban water supply and sanitation, flooding, navigation Key issues (~10) Water for Production Industrial, hydropower, irrigation, fisheries and aquaculture Key issues (~10) Water for Environment Assets, water requirements, services Key issues (~10) Summary (~40-50 key findings) Long-term vision (20-25 yrs) High-level water reform objectives Achieved within 10 years ~10-15 objectives High-level actions ~5-10 for each objective Process High level inter-ministerial committee chaired by PM/Minister Senior-executive (Direct General/Director) interministerial sub-committees Instruments Background papers Concepts Examples of successful application Examples of processes used for rolling out reform Study tours - to show what successful reforms looks like High-level work plan For each objective/action - Timelines Roles and responsibilities 5 year review period Gov s business plan for water reform, in-line with national budget cycles Identifies and prioritises programs/projects to address NWRP objectives Using - Various economic, social and environmental appraisals Influence by - Donor s objectives Politics Budget