KATHMANDU, May 5: Finance Minister Barshaman Pun has reiterated his stance of announcing the budget for the upcoming fiscal year within the ceiling provided by the National Planning Commission (NPC), but Prime Minister Pushpa Kamal Dahal seems to be on the side of breaching the threshold given by the NPC.
Speaking at a meeting of the Development, Economic Affairs and Good Governance Committee under the National Assembly on Friday, Finance Minister Pun said the government will not cross the budget ceiling of Rs 1.8 trillion fixed by the NPC. “The government cannot cross the limit given by the NPC,” said Pun, replying to a number of lawmakers, who argued for increasing the budget on specific areas.
Just a day after Pun expressed his views on the budget, Prime Minister Dahal said the government is preparing to introduce a budget of Rs 1.9 trillion for the next fiscal year. Speaking at a parliamentary party meeting of CPN-Maoist Center on Saturday, Dahal said the government is introducing a large budget. “We are increasing the earmarked funds with the objective of bringing a people-oriented budget,” said a party member quoting Prime Minister Dahal.
Revised interest rate corridor system introduced
The government is preparing to announce the budget for the fiscal year 2024/25 on May 28 this year. The government is under pressure to curtail unproductive expenditure due to a crunch in financial resources caused by inadequate revenue collection.
For the current fiscal year 2023/24, the government had allocated a budget of Rs 1.751 trillion. However, citing the low revenue collection, the government downsized the budget by 12.62 percent to Rs 1.530 trillion through the mid-term review of the budget.
With almost 10 months of the current fiscal year having passed, the government has achieved only 55.43 percent of the revenue collection target as of Friday. The revenue collection during the period stood at only Rs 788.47 billion against the government set target of Rs 1.422 trillion.
Due to the excessive expenditure compared to the slow revenue collection, the public debt burden has increased massively in the current fiscal year. According to the statistics of the Public Debt Management Office, Nepal’s public debt surged to Rs 2.388 trillion by mid-March, with an additional loan of Rs 218.86 billion in the first eight months.
However, the government is still not cautious about checking its unproductive expenses. Prime Minister Dahal during Saturday’s meeting reiterated the government’s plan to implement a ‘result-oriented’ budget next year.
On the other hand, Finance Minister Pun directed the government officials to put forth their programs only based on the budget ceiling given to the ministries concerned. “As we all have to abide by the budget ceiling, do not ask for crossing the limit, rather improve your efficiency to effectively utilize the given budget,” Pun said.
