KATHMANDU, June 27: A total of 71 local governments have failed to announce their budgets on time this year despite the constitutional provisions that require these sub-national governments to introduce their annual budgets by June 24 (Asadh 10) every year.
An intergovernmental finance management law has set June 24/25 as the deadline to announce the budget at the local level. As per the records of National Association of Rural Municipalities (NARM) and Municipal Association of Nepal, 30 municipalities and 41 rural municipalities have failed to announce their budgets within the prescribed deadline.
This has been a perennial problem ever since Nepal adopted the federal system. Last year, only 40 percent out of 753 local governments presented their annual budgets on time. Similarly in 2019/20, 72 local governments failed to announce their budgets by the given deadline while 21 of them could not bring their budgets even until the first half of the fiscal year.
Hom Narayan Shrestha, chairman of the NARM, attributed the ongoing floods and landslides to the delay in the budget announcement. According to him, many high ranking officials of the local bodies staying in home isolation with the risk of COVID-19 has also affected the preparation of their financial plans, affecting the budget presentation.
Officials at the Ministry of Federal Affairs and General Administration (MoFAGA) said most of the local bodies are facing internal conflicts related to allocation of budget and lack of trained manpower to formulate the budget. According to the MoFAGA, the first tranche of the budget is automatically sent to their respective accounts after the fiscal year begins. If any local body is unable to present its budget, its budgetary expenses will be put under the heading of arrears.