A total of 42 local governments have failed to announce their budget for the next fiscal year in the given deadline of June 25 (Asadh 10).
According to the records of the National Association of Rural Municipalities in Nepal and Municipal Association of Nepal, out of 753 local governments, only 711 local governments announced their annual financial plans within the prescribed time. The Intergovernmental Fiscal Management Act 2017 has made it mandatory for the sub-national governments to introduce their annual budgets by June 25 every year.
Of the 42 local governments not fulfilling their responsibilities, 29 are rural municipalities and 13 are municipalities. Madhesh Province records the largest number in the row. The province’s 13 rural municipalities and 10 municipalities have not announced their annual budget. Madhesh Province has 59 rural municipalities and 77 municipalities in total.
While 94 percent of 460 rural municipalities across the country have announced budgets, 29 could not complete their task. Three out of 88 rural municipalities of Koshi Province, two out of 58 rural municipalities of Gandaki Province, three out of 74 of Bagmati Province, four out of 73 rural municipalities of Lumbini Province and four out of 54 rural municipalities of Karnali Province have not announced their annual budget. All the 54 rural municipalities of Sudurpashchim Province accomplished their duties in the given deadline.
Similarly, only 280 out of 293 municipalities have fulfilled their duty in the prescribed time. Two out of 27 municipalities of Gandaki Province and one out of 25 municipalities of Karnali Province did not accomplish their task. All the municipalities of Koshi, Bagmati, Lumbini and Sudurpashchim provinces announced their budget by the given date of June 25.
According to the Ministry of Federal Affairs and General Administration (MoFAGA), the local governments that have breached the state law will face action from the federal government. Kamal Bhattarai, joint-secretary of the ministry, said these local governments will lose two marks in their work appraisal. In addition, these local governments will not be getting the grants from the federal government until they announce the budget for the given fiscal year.
Bhattarai said the MoFAGA on Monday has sent letters to all the local bodies to upload their financial plans in the ministry’s portal. As of now, only 155 local units submitted their plans in the system, but 598 have failed to do so.
The delay in budget announcement has been a perennial problem ever since Nepal adopted the federal system. In 2021/22, 71 out of 753 local governments could not present their annual budgets within the prescribed time. Likewise, five local governments had not unveiled their budget even in the first half of the current fiscal year.
This sort of problem at the local levels has mainly been attributed to the political differences among the local leaders. In addition, lack of manpower and poor workout in preparation are also among the reasons seen in some of the local bodies, which made them miss the deadline.
