Outstanding reimbursements down in last fiscal year
KATHMANDU, FEB 07 -
There has been a little improvement in the tardiness of donor-funded projects in getting timely reimbursement from donors. Outstanding reimbursements as of the last fiscal year 2011-12 amount to Rs 22.15 billion, slightly down from Rs 24.60 billion in the previous fiscal 2010-11. In fiscal 2009-10, the outstanding amount was Rs 32 billion.
It is a common practice in development projects to spend the budget allocated under donors’ heading and claim reimbursement from them after submitting paperwork of the expenditure. Slowness in claiming reimbursement has also been a common practice, resulting in repayment being delayed.
According to the Financial Comptroller General Office (FCGO), the amount to be reimbursed as of fiscal 2011-12 stands at Rs 16.08 billion from grant and Rs 6.06 billion from loan categories.
“A large amount remains to be reimbursed as expenditure is made towards the end of the fiscal year,” said an FCGO official. “Whatever progress has been made in reducing the size of the outstanding refunds is due to our continued efforts to conduct early reporting.”
In order to ensure timely reimbursement from donors, the government has continued the policy of not releasing further budget funding in case of failure to demand timely reimbursement. FCGO officials said that the policy has been implemented strictly with a few exceptions where the Finance Ministry has recommended releasing the budget.
The FCGO has issued working procedures for sanctioning of the budget under the reimbursement heading this fiscal year. As the first trimester has already passed, the FCGO has said that any office seeking resources for the second trimester would have to get the entire reimbursement of the spent budget in fiscal year 2011-12. “Otherwise, a recommendation of the Finance Ministry must be submitted to get the budget released,” it added. In order to get the budget released for the third trimester, the projects concerned should have already got reimbursement of the spent budget in the first quarter of the current fiscal year.
FCGO officials said that the situation would improve further next year as all the district treasury offices would come under the treasury single account (TSA) under which the budget would be released from a single account of the district treasury office.
The TSA enables the FCGO to monitor the status of the expenditure of any project instantly. “We are confident that we can bring down the size of the amount to be reimbursed to below Rs 18 billion in the next fiscal,” said an FCGO official.
However, he said that if the budget is spent early in the fiscal year, reimbursement can be sought which will ultimately reduce the size of the amount to be reimbursed at the end of the fiscal year. Timely reimbursement is also important for the country to ensure a better balance of payments condition.
Projects under ministries getting greater donor funding have a higher amount outstanding to be reimbursed.
The Ministry of Education has been continuously topping the chart for the last few years with regard to getting higher reimbursement from donors.
As of the last fiscal year, the Education Ministry has a total of Rs 6.33 billion to be reimbursed from donors followed by the Health Ministry with Rs 4.94 billion.
Other ministries in the top five in terms of outstanding amounts to be reimbursed are the ministries of Federal Affairs and Local Development and the Physical Planning, Works and Transport Management and the Prime Minister’s Office, particularly the Poverty Alleviation Fund.
The agencies having the least amount to be reimbursed are the Ministry of Tourism and Civil Aviation with Rs 8.8 million, National Planning Commission, Ministry of Energy, Ministry of Forest and Soil Conservation and Ministry of Information and Communication.
Source: Republica
