KATHMANDU, May 22: The ongoing political wrangling has thrown the enactment of the annual national budget into uncertainty even as the constitutionally-defined date for budget announcement, May 29, is just a week away.
On Friday midnight, embattled Prime Minister KP Oli dissolved parliament and announced midterm elections of the lower house of federal parliament for November. The absence of the federal parliament will affect the enactment of the budget for 2021/22.
Experts said that the new political scenario has left the country with only one choice - to get the annual budget through an ordinance. According to them, the budget enforced through this process has a large number of limitations to ensure social welfare and economic development of the country, provided the existing government maintains some ethical ground to respect the law.
“While the budget enforced through an ordinance cannot alter the rate of taxation, the programs such as launching new projects and revising the social security schemes, among others, which create notable financial liabilities to the state, cannot be taken forward,” Keshab Acharya, former economic advisor to the Ministry of Finance (MoF), told Republica. “The budget now has to focus largely on managing recurrent expenditure along with the funds required to tackle the ongoing crisis of pandemic,” he said.
The political mess created in the country in the past few months has already overlooked the routine works necessary for budget preparation. Although the MoF has been reiterating to have done almost all related work for drafting the budget, the government has failed to fulfill the main components of the budget --pre-budget discussion in the parliamentary Finance Committee and presentation of Principles and Priorities of the Appropriation Bill and the government’s Policies and Programs.
Despite having sufficient time to work on these aspects, the government was engaged in political issues leaving the country’s main financial manifesto in a limbo, Acharya opined.
Economist Dipendra Bahadur Chhetri said the budget now will be simply a ‘financial report’ published by a government agency. “As the government itself set the expenditure priorities based on the sources of revenue, without seeking any validity from the people’s representatives and inputs from experts, it will barely be accountable for the welfare of the state,” Chhetri said.
The National Planning Commission has set a ceiling of around Rs 1.80 trillion for next year’s budget. Although the government ministries have already forwarded their ambitious programs to the MoF, they will not be getting any space in the new budget, according to Chhetri.