Closed government books are an embarrassment to the country and its citizens. How open budget books are is directly proportional to public engagement in decision-making in resource management. It is the government’s responsibility to routinely report to citizens on spending, revenue collection and borrowing during the budget year. The more open budget documents are, the more the citizens’ attention to public money management. Thus it is important that the government produce and publish budget documents to ensure ‘public availability and accessibility’. The documents should be comprehensive and in the right format and language so that people can inform themselves on public finance and question the expenditure of every rupee of public money. Since greater openness leads to better participation, accountability and less corruption, it is up to the Ministry of Finance, which is responsible for producing the budgetary document, to make it happen.
Budget information is defined as publicly available citizens and their representatives are able to obtain it through request to public authorities issuing the document, in a timely manner and at no or nominal cost. The public has the right to access comprehensive, timely, useful and accessible budget information, namely the eight key budget documents: Pre-Budget Statement, Executive’s Budget Proposal, Enacted Budget, Citizen Budget, In-Year Reports, Mid-Year Review, Year-end Report and Audit Report. [break]
Assessing the availability of the key budget documents for the fiscal year 2011-12 (last time when the budget was presented to the parliament), Nepal produced and published Budget Speech and Budget Details for FY 2011-12 (Red Book) as an Executive Budget Proposal and its supporting documents including the Profile of Technical Assistance and INGOs, Medium-Term Expenditure Framework for fiscal year 2011/12- 2013/14 and Economic Survey, 2010-11. But these documents lacked information on fiscal activities such as extra-budgetary fund and contingent and future liabilities, among others, that can impact government policy.
The budget for the fiscal year 2011-12 was enacted on September 20, 2011 without any modifications in the budget proposal unveiled by the Finance Ministry for the first time since the Constituent Assembly (CA) elections in 2008. The practice of enacting the executive budget proposal without thorough discussion and possible changes undermines the parliament. The budget oversight provided by the Nepal’s Legislature-Parliament was weak since neither did it amend the Executive Budget Proposal nor hold open budget discussions.
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Ironically, Nepal does not produce Pre-Budget Statement and Citizen Budget, which are two instrumental budget documents that increase public participation during the four stages of budget process: formulation, approval, execution and audit. The Pre-Budget Statement should be made public at least a month before the budget is unveiled in the parliament. The goal is to allow citizens to get timely information on government policy, budget and its broad parameters and facilitate public engagement in the process. Similarly, the citizen budget, which the government should produce and publish at a time the executive’s budget proposal is enacted to demystify the jargon-laden technical aspects of the budget, is yet to come into practice.
To ensure that administrative units (ministries, departments and agencies) are held accountable for their expenditure, the In-Year Reports, which are to be issued on a monthly basis according to the OECD-stipulated best practice, should show actual expenditures by each administrative unit. As an In-Year Report, the central bank of Nepal produced Quarterly Economic Bulletin-2011 with the aggregated data of government budgetary operations. It is necessary to conduct a comprehensive review of the implementation of the budget every six months to ensure that programs are being implemented effectively and to identify any emerging problems. The Mid-Term Evaluation Report of the budget-2010/11 was brought out as a Mid-Year Review which failed to cover economic outlook, implementation status and economic scenario, among other important issues.
The Year-End Report as the key accountability document consolidates information on the expenditures of administrative units, revenue sections and debt and should cover all the items included in the budget as well as non-financial performance information, according to the International Budget Partnership (IBP), an undertaking which collaborates with CSOs across the globe to analyze and influence public budgets. The Financial Comptroller General Office (FCGO) had produced and published the Consolidated Financial Report 2009-10 and submitted to Office of Auditor General (OAG) within four months after the year-end. The document was up to the international standard. Audit Report is an independent evaluation of the government’s accounts by the Supreme Audit Institution, i.e. Office of the Auditor General. The OAG audits annual expenditures of national entities within six months of the end of the fiscal year, albeit only budgetary funds.
At a time when the government has initiated discussions on budget for the next fiscal, availability of budget documents as well as comprehensive data could greatly reform the budget system. Though there will be no parliament in the country when the next fiscal year budget is unveiled, the incumbent government with former bureaucrats with vast knowledge and experience of working in areas of critical national interests can pave the way for greater budget openness. It would do the country and citizens great justice if the Chief Justice-led government could deliver on this.
The author is IBP-implemented Open Budget Initiative’s Researcher for Nepal
sangreela@gmail.co
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