Element 1: Procurement

1.a

Corruption and fraud in the procurement process:

• Collusion during bidding process 
• Biased bid evaluation 
• Suppliers/contractors offering incentives for favorable treatment

The Project will strictly apply the Government’s Standard Operating Procedures (SOP) and Procurement Manual (PM) mandated on 26 February 2007, both of which are in line with ADB guidelines.

Ministry of Labor and Vocational Training (MOLVT) with ADB approval

Throughout project duration.

1.b

Procedures and thresholds

The Project will strictly follow SOP/PM and procurement instructions stated under the implementation arrangement paragraphs 66-71 of Report and Recommendation of the President (RRP)

The Project will strengthen in the Project Administration Manual (PAM) to detail project administration procedures, including implementation arrangements, implementation schedule, procurement, disbursement procedures, monitoring and evaluation, reporting requirements, auditing requirements, assurances, key persons involved in the Project, and anticorruption.

MOLVT with ADB approval

 MOLVT with ADB approval

Throughout project duration.

 

Inception mission.

1.c

Weak procurement capacity

A procurement capacity assessment was undertaken as part of the project preparation technical assistance for preparation of the Project. The assessment found that DGTVET is experienced in the procurement of goods but less experienced in procuring works, services and consultants, and site management and monitoring of civil works.

Training and mentoring will be provided to strengthen capacity, specifically in the preparation of bid documents for civil works, bid evaluation and preparation of bid evaluation reports for civil works, training of PCU staff and Procurement Review Committees on procurement regulations and ADB Guidelines, preparation of detailed lists and technical specifications of equipment, and selection and contracting of consulting services.

The Project will be monitored, and where necessary, additional measures will be incorporated to improve procurement procedures.

As procurement process is beyond the award of contract, the Project will organize frequent monitoring visits to work sites in order to ensure that the construction works will meet quality standards in line with desired specification.

The Project will recruit a national civil works and procurement specialist (48 months) to build capacity of MOLVT staff in designing, managing, and the evaluation of the civil works and procurement plan. 

MOLVT with ADB approval

Throughout project duration.

1.d

Inadequate or delayed procurement plans

The Project will prepare a procurement plan as guided by ADB's Procurement Guideline and SOP/PM.

The Project will prepare an annual Procurement Plan tied to the annual work plan and budget.

MOLVT and ADB

MOLVT with ADB approval

First year plan completed by appraisal mission.

In October/November 2010, and annually thereafter.

1.e

Informal payments by contractors, suppliers and consultants

All contractors, suppliers and consultants—firms or individuals, national and international—bidding for contracts under the Project shall sign the Declaration on Ethical Conduct and Fraud and Corruption in the SOP/PM, and be subject to the sanctions specified in the ADB’s Procurement Guidelines.

MOLVT with ADB approval

Throughout project duration.

1.f

Potential project staff-contractor collusion over volumes and build quality

The Project will strengthen project monitoring and introduce technical audit and the midterm- review to clarify structures, authorities, and effectiveness of project management.

MOLVT with ADB approval

Inception mission.

Element 2: Financial Management (FM)

2.a

Weak internal controls

The Government will strengthen the financial management system and internal audit function of MOLVT, and provide capacity development through the extension of the PFM reform program to MOLVT.

The Project will apply internal control procedures specified in SOP and Financial Management Manual (FMM), both of which are consistent with ADB guidelines, including in the areas of: 

• financial policies and standards;
• elements of internal control;
• financial accounting system, ledgers, journals;
• bank accounts and credit/grant withdrawals;
• project expenditure, payroll, petty cash, advances; and
• financial management reports, audit, counterpart funds withdrawals.

MOLVT and Ministry of Economy and Finance (MEF)

Throughout project duration.

2.b

Cash transactions

The Project will ensure that payments to contractors, suppliers and consultants – firms, individuals, national and international – are made by cheque or transfer to bank accounts, and will retain evidence for audit and donor supervision missions.

MOLVT

Throughout project duration

2.c

Inconsistent allowances paid to Government staff attending training, workshops and study tours

The Project will follow MEF’s Instruction Letter No. 2000 dated 23 April 2007 on standard daily subsistence and travel allowances.

The Project will establish an Annual Training and Workshop Plan.

The Project will set eligibility rules for attending training, workshops and study tours. Attendees must: 

• be engaged in work relevant to the training
• be competent in the language used
• after return, report on and share their experiences for the benefit of the project

The Project will ensure that training, workshops, study tours and other similar activities:

• are in line with project aims and objectives
• meet identified needs within the sub component plans
• have budget in line with planned expenditure approved by MOLVT. Project to seek MOLVT prior approval if any significant changes or departures.

The Project will set cost guidelines for selected training/workshop activities:

• venue rental with refreshments/meals
• sound and projection equipment hire
• stationery/hand-outs
• project-specific training and workshop materials
• simultaneous translators
• photocopying, reproduction, translation.

The Project will define evidence to be submitted by attendees for reimbursement of expenses which may include: 

• proof of attendance for period claimed with signed statement by the workshop, training or study tour organizer or host;
• proof of travel by air-ticket stubs, travel agent’s receipt, airline boarding passes, airport taxes;
• receipted hotel bills (for proof of stay);
• receipts for incidental traveling expenses;
• receipted invoices for venue rental, food and beverage, sound/projection equipment, hire of simultaneous translator, stationery and handouts, use of photocopying facilities.

The Project will reimburse against receipts except where covered by fixed allowances in MEF’s Letter No. 2000.

The Project to retain evidence of payment of attendees’ per diem and allowances.

MOLVT with ADB approval

 
MOLVT

 
MOLVT

MOLVT with ADB approval

MOLVT, MEF with ADB approval.

MOLVT, MEF with ADB approval

The Project financial officers

The Project financial officers

Throughout project duration

Throughout project duration as per annual work plan.

Throughout project duration as per annual work plan.

Throughout project duration as per annual work plan.

Throughout project duration as per annual work plan.

Throughout project duration as per annual work plan.

Each occasion

Each occasion

2.d

Delayed or non-existent reconciliation of advances for operating costs and expenses

The Project will reconcile advances of operating expenses of staff or field offices within one week of the end of each month.

The Project to ensure that no further advances are paid until previous advance reconciled and cleared against documentary evidence.

The Project financial officers

The Project financial officers

Each occasion

Throughout project duration

Element 3 : Disclosure

3.a

Conflict of interest among project staff

The Project will minimize conflict of interest through disclosing of private and public affiliations or personal interest before becoming involved in any project related transaction such as contract award.

MOLVT

Throughout project duration.

3.b

Enhance transparency through greater public disclosure of project information

The Project will disclose on MOLVT's website, with hard copies available for public inspection if requested, at a minimum:

• project name, objectives, original and revised amount, sources of funding, effectiveness date, number of extensions, name and address of MOLVT, name of ADB officers in charge, list of Project Steering Committee (PSC) members and contact information in the MEF-ADB unit, contact information for ADB office in Cambodia, and contact information and mandate of ADB's Office of Anticorruption and Integrity;
• details of project components, percentage completion, data on performance indicators;
• annual Work Program and Procurement Plan, identifying contracts to be procured in the next 12 months, nature of each contract, cost estimate, location, method of procurement, means of advertisement, bidding period, location where bidding documents and RFP’s can be inspected, expected date of availability, and cost of bidding documents;
• consultant long and short lists;
• bidding documents and RFP’s to be available for inspection;
• bid closing dates, names of bidders and their bid prices at opening;
• list and details of contracts awarded, names of losing bidders and, if their bid prices were lower than the winning bidder, the reason for their rejection;
• six month progress reports;
• planned and actual disbursements by sub component;
• annual financial statements and audit opinion;
• other specific reports prepared by the Project
• complaints remedies and mechanism;
• criteria and procedure for selection of candidates for scholarships; and
• code of ethical conduct once signed by all staff.

MOLVT and ADB to agree final list

Agreed at grant negotiation.

Element 4: Complaints and Remedies Mechanism

4.a

Inadequate complaints and remedies mechanisms

The Project will prepare a remedy mechanism to address complaints, including establishment of a grievance redress mechanism at Project Coordination Unit (PCU), Provincial Training Centers (PTC), and Regional Training Center (RTC) to receive complaints/grievances from communities, contractors, etc.

Procedures regarding procurement complaints are to follow process set out in the Grant Agreement and SOP/PM

MOLVT with ADB approval

MOLVT and MEF

Inception mission

Throughout project duration

Element 5: Code of Ethical Conduct

5.a

Poor enforcement of the Code of Conduct for civil servants

The Project will provide copies of the relevant laws and articles on Code of Conducts for civil servant to all Project staff, including contracted staff. Project will maintain signed declaration of receipt of these documents by all Project staff, including contracted staff.

MOLVT

Inception mission or to be incorporated in PAM

Element 6: Sanctions

6.a

Inadequate sanctions for fraudulent and corrupt activity by project staff, contracts, suppliers and consultants.

The Project will identify and apply sanctions available under current law and regulations of Cambodia.

Sanctions for individuals may include transfer of duties, retaining, suspension, dismissal, re-grading, prosecution under Cambodian Law. Sanctions for firms may include: termination of contract, debarment, blacklisting, and prosecution under Cambodian Law.

MOLVT 

Throughout project duration

Element 7: Project Specific Elements

7.a

Risk of low quality construction and supervision.

The Project will recruit a national civil works and procurement specialist (48 months) to assist the project staff in preparing and costing a design for civil works package; monitoring procurement connected with civil works; supervising the construction and renovation of PTCs and RTCs.

See also 1 f. above.

MOLVT and ADB approval

Throughout project duration

7.b

Risk in abuse in resettlements of affected people over appropriate compensation

The Project to ensure that no rehabilitation or construction of facilities for PTCs, RTCs and hostels will involve involuntary resettlement according to ADB’s Policy on Involuntary Resettlement (1995) and the relevant Government regulations. Ensure that monitoring of the implementation of any Resettlement Plan is done by External Monitor.

MOLVT, Inter-Ministerial Resettlement Committee, NGOs, and ADB approval

Agreed at grant negotiation

Before issuance of civil work contracts