The government has been spending around 73.4 percent of the development budget in the fiscal year 2018-19 as the new fiscal year is about to begin.
As per the statistics maintained by the Financial Comptroller General Office (FCGO), the government has been able to spend Rs 230.4 billion during the fiscal year or 73.4 percent of the Rs 313.99 billion development budget allocated for 2018-19.
Though the government has claimed to have simplified the public procurement process and other policies to boost spending on development works, the inability of the government to spend more than 26 percent of the allocated capital expenditure has reflected problems in government spending and the sluggish progress in development works throughout the fiscal year.
The Ministry of Finance (MoF) had revised the capital budget for the ongoing fiscal year to Rs 265.20 billion through the mid-term review report of the budget for the fiscal year 2018-19 following the government’s failure to expedite project development and enhance its spending capacity.
However, the government’s total budget spending in the fiscal year 2018-19 is at 82.34 percent of the total budget of Rs 1.31 trillion.
The government has been able to spend Rs 711.3 billion as recurrent expenditure of the total allocated Rs 845.45 billion during the review period.
Similarly, the government has spent around Rs 141 billion on financing in 2018-19, out of the total allocated budget of Rs 155.72 billion for the ongoing fiscal.
Looking at the rising pressure to spend a huge amount of the budget at the end of the fiscal year will promote haphazard spending and also affect project development, experts have suggested the government to improve the bureaucratic and contracting mechanisms in Nepal to ensure effective capital budget expenditure.
They have also stressed on the necessity to focus on project planning and policy execution to accelerate projects and improve the spending of the government. “The government should invest in enhancing the capacity of Nepali bureaucrats and also contractors. Lessons should be learned to ensure effective spending in the new fiscal year and thereafter,” said Bishwo Poudel, an economist.