Finance Minister instructs ministries to spend money

KATHMANDU:

The government identified the site for second international airport in Nijgad in 2007. But even after seven years, it has not been able to decide whether to build the project under build-own-operate-transfer (BOOT), public-private-partnership (PPP) or other models.

To link this airport with Kathmandu Valley, the government officially floated the idea of building a fast track five years ago. But the project has not been able to take off either.

Similar is the case with mid-hill and postal highways, east-west electric railway link and Melamchi Drinking Water Project, whose construction works are moving ahead at snail’s pace.

These are few physical infrastructure projects prioritised by the government — although list of such projects is quite long. But implementation of almost every project handled by government seems to be lagging.

The reason for weak project implementation, surprisingly, is not lack of funds.

The government allocated Rs 116.75 billion for capital expenditure this fiscal year, which began in mid-July. But as of November 20, only Rs 6.59 billion, or 5.64 per cent of the allocated amount, was spent.

As a result, around Rs 69 billion was sitting idle in government coffers as of last week.

Such a huge saving does not bode well for countries like Nepal, which is facing huge infrastructure gap and only indicates government’s inability to make timely use of funds. This, in turn, affects job creation process and lowers demand for credit in the private sector.

In this regard, Finance Minister Ram Sharan Mahat today instructed secretaries of various ministries to act fast and deliver results.

“Don’t shirk responsibilities. Development activities do not move forward without making efforts,” a statement issued by the Ministry of Finance (MoF) quotes Minister Mahat as telling the secretaries.

He further said: “Mega multi-year projects do not need clearance from government bodies for implementation. And if they are lacking funds, we are willing to earmark additional budget. But don’t make excuses.”

He also said the MoF was willing to transfer funds from projects that have not made any progress to those that are in need of money. “So, please inform the ministry about projects that cannot be implemented soon.”

While government ministries fail to make use of available funds in the first half of fiscal years, they suddenly go on spending binge towards end of the fiscal, raising questions over quality of such expenditure.

Last fiscal, for instance, 37.8 per cent of capital budget was spent in the last month and 58.8 per cent in last three months.

Source: THT