The federal government’s budget formulation process for the upcoming fiscal year 2082/83 BS in Nepal has encountered significant challenges due to delays in amending critical laws and procedures. The situation is marked by uncertainty and procedural setbacks, which have hindered progress in both planning and implementation.
The National Planning Commission (NPC) has postponed seeking plans and programs from provincial and local governments because the Federal Supplementary and Special Grants Work Procedure has not been amended. The Ministry of Finance is similarly facing confusion, as the Financial Procedure and Fiscal Responsibility (First Amendment) Bill, 2081 BS, remains stuck in parliament, leaving uncertainty about the framework and timeline for budget preparation.
Existing regulations require the NPC to request proposals for grant-related projects by mid-December, with submissions due by mid-January. However, these timelines have been disrupted due to pending revisions. The 53rd meeting of the National Development Problem Solving Committee, chaired by the Prime Minister, directed the NPC to prepare amendments to the supplementary and special grants procedures, aiming to make the process more equitable and inclusive. The NPC has indicated that while delays are inevitable, the revised procedures will ensure fairer distribution of grants, emphasizing socio-economic equality and support for marginalized communities.
In addition, the lack of clarity regarding the budget calendar further complicates the process. Efforts to streamline the budget formulation process, such as the Financial Procedure and Fiscal Responsibility (First Amendment) Ordinance, 2080 BS, have failed to yield long-term solutions. The ordinance, which introduced a new timeline for presenting budget principles and priorities, was repealed after it could not secure parliamentary approval. Although the government has introduced a new bill to amend the budget calendar, it remains under consideration, leaving ambiguity about whether the upcoming budget will follow the provisions of the existing Act, the repealed ordinance, or the proposed bill.
These delays and legislative bottlenecks have significant implications. Administrative inefficiencies risk further postponing development projects and service delivery. The proposed amendments aim to promote equity, inclusion, and balanced development, but achieving these goals depends on timely legislative action. The uncertainty around the budget calendar also undermines transparency and accountability in financial planning.
To address these challenges, the government needs to expedite legislative processes to finalize the amendments and the budget calendar bill. In the interim, clear guidelines should be issued to ensure continuity in planning and development. Additionally, enhanced parliamentary engagement and public discussion on budget priorities are essential to foster transparency and align legislative actions with administrative deadlines. Only through coordinated and decisive action can the government ensure equitable resource allocation and effective governance.
