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Execution of budget 2019/20 pathetic despite ⅔ majority govt’s repeated commitments to improve

July 17, 2020

My Republica, July 17, 2020

KATHMANDU: The government appeared pathetic in the execution of the budget announced for fiscal year 2019/20 which ended on Wednesday, spending less than 50% of the amount earmarked for development projects while falling short by 30% also in revenue collection.

The records of the Financial Comptroller General Office (FCGO) show that the government’s revenue collection stood at Rs 793.78 billion - just 71.38% of the targeted amount of Rs 1.11 trillion. The revenue collection was not up to the mark even with the second time revision of the earmarked amount. Citing the lockdown and threat of coronavirus, the government in mid-June reduced the revenue target to Rs 860 billion.  

Similarly, the capital expenditure in the last fiscal year remained at Rs 191.76 billion - only 47% of the targeted Rs 408 billion. The government may blame it on the impact of coronavirus but it reveals the inefficiency of the government mechanism to provide development fruits to the general people, according to some experts.

They said that the government is using the pandemic that hit almost every nation as a mere excuse. But if one is to consider the government statistics of the past five years, the spending on development projects was dismal almost every year. During the period of 2014/15 and 2018/19, the government spent 72 percent of the capital budget on average. In the fiscal year 2018/19, the government spent 73.4 percent of the development budget, which was Rs 230.4 billion out of the allocated Rs 313.99 billion, according to the FCGO.

For the past three years, the government has been publishing the budget statement at the end of May, almost one and a half months before the start of the new fiscal year, to provide adequate time for planning and ensure that the allocated funds are spent.

Last December, the government amended the Public Procurement Regulation 2007 for the fourth time in order to simplify the provisions. The new regulation made it mandatory for bidders to be technically and financially qualified to get government contracts. In a recent move, the government is in the process of amending the existing Public Procurement Act, the main tool for the government officials to play the blame game for the slow capital expenditure.

Nonetheless, the two-thirds majority government reiterates to have put into efforts to make notable spending on the development projects. Last October, Uttar Kumar Khatri, spokesperson for the Ministry of Finance, told Republica that the ministry was formulating new work guidelines, amending the existing work guidelines and tender documents, and selecting contractors for their projects which might not hamper the timely execution of the projects. But the ministry officials said that the working styles haven’t changed at all. 

Source: https://myrepublica.nagariknetwork.com/news/execution-of-budget-2019-20-pathetic-despite-2-3-majority-govt-s-repeated-commitments-to-improve/