KATHMANDU, March 10: Government officials have said inadequate planning of development projects was one of the reasons behind low capital expenditure.
Speaking at an interaction organized by the Society of Economic Journalists-Nepal (SEJON) in Kathmandu on Tuesday, they said lack of coordination between ministries and line agencies, flaws in project selection process, budget allocation without making any preparatory works, lack of ethics among contractors, and complex authorization process are the other reasons behind low public spending.
Expediting Capital Expenditure
“Budget is allocated for projects even without completing basic preparatory works. In some cases, the project is cleared despite lack of clarity on its modality,” Baikuntha Aryal, joint secretary at Ministry of Finance (MoF), said. “Going for the process of contract without completing preparatory works only leads to cost and time overrun. This leads to dispute with contractors and the project gets delayed. Sikta Irrigation Project is an example of this case.”
According to MoF, the performance of big ministries in terms of capital spending is poor. Capital expenditure stands at 19.87 percent of the allocated Rs 116 billion as of Monday, data shows. Ministry of Energy is the worst performer in terms of public spending with its expenditure standing at mere 7.76 percent of the budget allocated to it. Similarly, Ministry of Urban Development spent only 19.31 percent of the allocated budget in the review period. Capital expenditure of Ministry of Irrigation and Ministry of Physical Infrastructure and Transport (MoPIT) stands at 22.54 percent and 24.07 percent, respectively.
“The prevalent practice of 'finance first and program preparation later' should be ended,” added Aryal.
Speaking at the program, Tanka Mani Sharma, secretary of Public Procurement Monitoring Office (PPMO), took exception over the accusation of tendency to find fault at the public procurement laws for the failure to meet development expenditure target. “Public Procurement Monitoring Office has not stopped development activities. We skip various steps of project management and pass blame on PPMO," Sharma argued. "The ministries and the concerned agencies should be able to scrap contracts and seek alternatives if the contractors are at fault.”
Similarly, Tulasi Prasad Sitaula, secretary of MoPIT, said the tendency to focus on projects 'propping up from the pockets' was the main obstacle for development. “Despite knowing that the project is not feasible, we introduce it in the budget either for regional balance or just because some leaders want it,” he added.
Chandramani Adhikari, member of National Planning Commission (NPC), vowed to include only the viable projects in the upcoming budget. “Only the demand-driven and feasible projects will be included in the budget,” he added.
Speaking at the interaction, Rabindra Adhikari, chairman of Development Committee of the legislature-parliament, said projects should not be moved ahead without completing 80 percent of preparatory works.
