By Our Reporter
Capital budget mobilisation has been poor in the past several years, and it was no different this fiscal year as well.
The utilisation of the budget allocated for the development works for this Fiscal Year 2023/24 was 52.2 per cent as of Sunday, according to the Financial Comptroller General Office (FCGO).
Then Finance Minister Dr. Prakash Sharan Mahat had announced a budget of Rs. 1751.3 billion with a capital allocation of Rs. 302 billion. But the government could spend only Rs. 157.7 billion eight days before the fiscal year was to end.
The government has spent Rs. 240.9 billion in financing which is 78.36 per cent of the total allocation. Total expenditure from the treasury is 1322.6 billion, 75.52 per cent of the total budget.
The trend of the capital budget spending has remained pathetic in the past three years as well with the total mobilisation remaining below 56 per cent of the actual allocation.
In the last FY 2022/23, the government could spend 55.22 per cent of the allocation of Rs. 380.3 billion during the same period. Because of the COVID-19 pandemic, the FY 2021/22 witnessed the worst performance in the development works and the government ended up with just 46 per cent capital budget utilisation. In 2020/21, about 53.6 per cent of the development budget was used.
Every finance minister announced and implemented policies to make the budget mobilisation effective and expedite the development works but none of them could make a nudge.
Frequent changes in government and replacement of the ministers are blamed for the poor expenditure. Obviously, the instability in the leadership of the key ministries including the Finance Ministry was the major reason behind the poor fiscal performance.
Likewise, the planning process has multiple weaknesses. The NPC has mandated that the project could be included in the budget only after completing the Detailed Project Report (DPR) but powerful leaders and ministers break this rule and include the project as per their interest.
The Ministry of Finance sometimes delays the disbursement of the required budget to the projects and programmes due to the poor revenue collection and this delay has long been impacting the construction entrepreneurs. As a result, the progress of the development projects has been disturbed.
Not only in the centre but also in the provinces, the scenario is no different. For example, the Bagmati Provincial Government has spent only about 73 per cent of the allocated budget in the current fiscal year.
Of the total budget of Rs. 62.70 billion only Rs. 45.67 billion was spent by July 8.
According to the Provincial Treasury Comptroller Office, Bagmati Province, Hetauda, about 79.47 per cent (Rs. 28.54 billion) of the total allocation under the capital budget heading has been spent while 65.14 per cent (Rs.17.12 billion) of the total allocation under the recurrent expenditure heading has been spent by July 8, the day of closure of the expenditure system of the provincial government.
For the current fiscal year, a budget of Rs. 26.42 billion was allocated for recurrent expenditure, Rs. 35.78 billion for capital expenditure and Rs. 500 million for financial management.
Worst, no budget allocated by the provincial government to the financial management was spent. The provincial government has set aside Rs. 500 million for the financial management in the current fiscal year but not a single penny was spent from this heading.
Login to add a comment