Over 40 local bodies fail to meet budget announcement deadline

KATHMANDU: A total of 42 local governments have missed the deadline of June 25 (Asadh 10) to announce their budgets for the upcoming fiscal year.

According to the records of the National Association of Rural Municipalities in Nepal and Municipal Association of Nepal, out of 753 local governments, only 711 have successfully announced their annual financial plans within the specified timeframe. The Intergovernmental Fiscal Management Act 2017 requires sub-national governments to introduce their annual budgets by June 25 each year.

Among the local governments that have not fulfilled their responsibilities, 29 are rural municipalities, and 13 are municipalities. Madhesh Province has the highest number of local governments in this category, with 13 rural municipalities and 10 municipalities yet to announce their budgets. Madhesh Province has a total of 59 rural municipalities and 77 municipalities.

While 94 percent of the 460 rural municipalities across the country have announced their budgets, 29 were unable to do so.

Among the provinces, Koshi Province has three out of 88 rural municipalities, Gandaki Province has two out of 58 rural municipalities, Bagmati Province has three out of 74 rural municipalities, Lumbini Province has four out of 73 rural municipalities, and Karnali Province has four out of 54 rural municipalities that have not announced their annual budgets.

However, all 54 rural municipalities in Sudurpashchim Province have accomplished their duties within the given deadline.

Similarly, out of 293 municipalities, only 280 have fulfilled their duty within the prescribed time. Two out of 27 municipalities in Gandaki Province and one out of 25 municipalities in Karnali Province did not complete their task.

On the other hand, all the municipalities in Koshi, Bagmati, Lumbini, and Sudurpashchim provinces announced their budgets by the specified date of June 25.

The Ministry of Federal Affairs and General Administration (MoFAGA) stated that local governments breaching the state law will face action from the federal government.

Kamal Bhattarai, joint-secretary of the ministry, explained that these local governments will receive a deduction of two marks in their work appraisal and will not receive grants from the federal government until they announce the budget for the fiscal year.

Bhattarai also mentioned that the MoFAGA has sent letters to all local bodies, instructing them to upload their financial plans on the ministry’s portal. However, as of now, only 155 local units have submitted their plans, while 598 have failed to do so.

The delay in budget announcements has been a recurring issue since Nepal adopted the federal system. In the previous fiscal year, 71 out of 753 local governments were unable to present their annual budgets within the designated timeframe.

Additionally, five local governments had not unveiled their budgets even in the first half of the current fiscal year.

This delay at the local levels is mainly attributed to political differences among local leaders. Furthermore, insufficient manpower and inadequate preparation have also been identified as contributing factors in some local bodies, leading to missed deadlines.