KATHMANDU, July 11: While the budget for the country’s development falls short, the government has failed to spend even the allocated funds, with one week remaining in the current fiscal year. In the current fiscal year, 2023/24, the government could not spend Rs 129.44 billion of the amount allocated for development expenditure (capital expenditure). According to the Financial Comptroller General Office (FCGO), a capital budget of Rs 302 billion has been allocated for the current fiscal year 2023/24. However, only Rs 172.9 billion has been spent till Tuesday (July 9). This is only 57.15 percent of the allocated capital expenditure. This means, the government has failed to spend some 43 percent of the development budget.
At a time when the people want to see development take place in the country, it is unfortunate that the government is unable to spend the development budget. Although the total budget expenditure of the government in the current fiscal year as of Tuesday is 77.51 percent, the situation of capital expenditure is very poor.
Omprasad Rijal, information officer of the FCGO, said that due to the lack of necessary preparation for budget spending, it could not be spent. Rijal said, “It seems that the agencies under the ministries responsible for development need to enhance their efficiency. As the funds were allocated without a plan to send, the funds remained unspent.” The budget has not been spent as expected also due to the employees’ indifference, delay in the land acquisition process for development projects, and the delays made by the construction companies.
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Due to the government’s inability to spend, other areas such as revenue collection have been affected. Additionally, the share of capital budget in the total budget is around 18 percent. Development and construction have also been affected as the funds allocated for various projects could not be spent.
Even though the capital expenditure is weak, the recurrent expenditure is 81.86 percent. This year, the payment from government funds has been halted from the night of July 8. According to the Office of Auditor General, government accounts have been closed for non-essential purposes since midnight.
Despite the government having brought a budget of Rs 1.75131 trillion for the current fiscal year, a revised estimated expenditure of Rs 1.53035 trillion was projected during the half-yearly review of the budget.
The government has also failed to collect the revenue as per the target. In the budget of the current fiscal year, the government had set a target of collecting Rs 1.42254 trillion in revenue. With one week remaining in the current year, only Rs 998.97 billion has been collected in revenue by July 9. Similarly, Rs 896.86 billion has been collected under tax revenue while Rs 102 billion has been collected under non-tax revenue.
It seems that there's a shortfall of Rs 400 billion in revenue collection based on the data.The government had set a revised estimated target of Rs 1.25372 trillion for revenue collection through the half-yearly review of the current fiscal year. It seems that the revised estimate will also not be met. This shows that the government determines revenue collection and expenditure targets on the basis of negligence rather than effective implementation. Likewise, revised estimates of foreign grants worth Rs 34.34 billion and foreign loans worth Rs 145.44 billion are expected to be mobilized.
The government has also failed to receive grants from foreign donors as expected and there is a shortage of resources for the development of the country. The government has set a target of receiving foreign grants worth Rs 49.94 billion in the current fiscal year. However, only Rs 2.75 billion has been received, in the 12 months (till Tuesday) of the current fiscal year. The government has not been able to receive foreign grants, due to delays in development works, procedural complications, poor ability to spend, and ambitious goals.
Furthermore, experts said that the grants did not come as expected because the development projects were not completed on time. When the government prepares the budget, revenue, internal debt, foreign debt and foreign grants are considered as sources. The government seeks foreign grants as well as loans. A revised estimate of foreign loans worth Rs 145.44 billion is expected to be mobilized in the current year.
