MoFAGA writes to local governments to immediately put into effect the austerity measures

Published On: February 5, 2023 09:00 AM NPT By: Republica | @RepublicaNepal

KATHMANDU, Feb 5: The Ministry of Federal Affairs and General Administration (MoFAGA) on Friday wrote to the district coordination committee and the local governments to implement the government-announced austerity measures.

According to the MoFAGA officials, all the ministries and related government offices will have to take into immediate effect the proposed 20 percent reduction on the allocated budget that has remained after these government bodies spent in the past six months of the current fiscal year. “The offices will have to submit the revised details in the Line Ministry Budget Information System,” reads the circular.

The MoFAGA has also asked the line ministries to forward details on originally approved and amended programs along with related expenses on the headings prescribed for the austerity measures to the Ministry of Finance (MoF).

The government has decided to cut down unnecessary expenses to maintain a fiscal balance that has become vulnerable due to the gap in government expenditure and income. The government in this regard announced to enforce measures on Tuesday.

The government has decided to slash 20 percent budget approved for various headings such as fuel, maintenance, stationery and office materials, newspapers, printing and publication of information, service and consultancy incurred by all the ministries and agencies of the federal government.

Likewise, budget approved for information system and software operation, travel and other allowances, program cost, monitoring and evaluation cost, staff training, workshop and seminar, sundry expenses, machinery and equipment, furniture and fixtures and structural improvement of the buildings are also reduced by 20 percent. Through the efforts, the government has estimated to save Rs 24.50 billion.

The MoF has decided to stop execution of budgetary projects and programs which are yet to start and not to create extra burden of payment in the current fiscal year. Under the plan, the province and local governments are also expected to reduce expenditure, excluding mandatory obligations under the recurrent heading by 20 percent.