First Business News Portal in English from Nepal
KATHMANDU: In an alarming display of fiscal mismanagement, the government has exhausted a staggering Rs 125.07 billion in just three weeks, breaching financial norms and jeopardizing budget discipline.
The Financial Comptroller General Office (FCGO) reported that the government had spent a modest Rs 153.08 billion in the first 11 months of the current fiscal year, but the expense figure skyrocketed to Rs 1.316 trillion as of the latest update.
To counter this worrisome trend, the FCGO recently issued a directive prohibiting unnecessary expenditures by all three tiers of government during the final week of the fiscal year. However, the Ministry of Finance went against this cautionary measure by releasing a substantial amount of funds to government agencies just before the FCGO’s prescribed deadline.
Within the three-week period, an additional Rs 31.4 billion was disbursed, underscoring the government’s inclination to haphazardly utilize funds intended for development projects. Despite having allocated a budget of Rs 1.793 trillion for the current fiscal year, only 73.41 percent of the total amount has been spent thus far.
This pattern of last-minute spending and the subsequent breach of financial discipline has become a recurring issue, as highlighted by the annual reports of the FCGO. Regardless of the ruling political party, the government persistently engages in such practices, ultimately striving to avoid freezing the allocated budget.
During the previous fiscal year, an astounding 21 percent of the total budget was spent in a single month, spanning from mid-June to mid-July. Out of the allocated amount of Rs 1.647 trillion, a staggering Rs 209.75 billion was expended solely in the final month of the fiscal year 2021/22.
Frequently, the government resorts to last-minute budget transfers as a mechanism to allocate funds at the eleventh hour of the fiscal year.
Last year alone, budget transfers amounted to Rs 196.41 billion, constituting around 12 percent of the allocated budget. Within the final month of FY 2021/22, Rs 82.80 billion was transferred, with an additional Rs 27 billion transferred in the last week.
These repeated instances of careless expenditure underscore the urgent need for the government to prioritize responsible financial management and break free from this detrimental cycle of fiscal indiscipline.
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