Mid-term budget review: Government expenditure contracts in first half

KATHMANDU, FEB 22 -

Government expenditure contracted in the first half of the current fiscal year as ministries and other government authorities delayed authorising their subordinate agencies to spend the budget , according to the mid-term review of the budget for the current fiscal year.

Government authorities are yet to authorise their subordinate implementing agencies to spend 55.66 percent of the budget , the report said. As a result, government expenditure shrank to Rs 104 billion as of first half of the fiscal year from Rs 111 billion in the same period a year ago.

As far as the capital expenditure is concerned, it stood at just Rs 7.66 billion down over the six-month period — down from Rs 9.56 billion a year ago.

The Finance Ministry said it authorised ministries and other agencies to spend the budget after the President endorsed budget ordinances. The President had endorsed two budget ordinances — first on July 16, 2012, authorising spending of the one-third of the last fiscal year’s budget , and second on November 22, 2012, for two-third budget spending.

According to the budget review report, the Finance Ministry authorised ministries and other government agencies to spend a total of Rs 267 billion. But the latter only authorised their subordinate agencies to spend just Rs 119 billion — 44.34 percent of the amount authorised to be spent.

Even several development programmes and projects are yet to get approval from the agencies concerned. First priority (P1) projects require the National Planning Commission’s (NPC) approval for implementation, while second and third priority projects are to be endorsed by the line ministries.

According to the mid-term review report, a majority of programmes and projects under the Ministry of Urban Development, Ministry of Education and Ministry of Irrigation were not the approved until mid-January. “A majority of the ministries have been found failing to get endorsed their programmes,” read the report. “This shows that ministries failed to comply with authorisation too.”

The finance ministry had asked ministries and government agencies to get their programmes and projects approved by the NPC or by line ministries — whichever mode is applicable.

During the review period, expenditure in foreign-aided projects has come down by 80.58 percent compared to the figure during the same period last year, according to the report.

Source: The Kathmandu Post