Nepal’s Public Accounts Committee (PAC) has raised red flags over the country’s swelling arrears, warning that the problem goes far beyond financial mismanagement — it’s eroding public trust and challenging the very notion of economic good governance.
Speaking at a national workshop on arrears, PAC members emphasized that the mounting arrears are not just accounting lapses but indicators of deep-rooted flaws in fiscal discipline. The latest Auditor General’s 62nd Annual Report revealed arrears have climbed to Rs 733 billion, a 9.34% rise from the previous year — now accounting for nearly 12% of Nepal’s GDP.
“This is not just a number,” said PAC Chair Rhishikesh Pokhrel, “but a serious governance issue.” He called for policy reform, digitization, and cross-institutional coordination to rein in fiscal indiscipline.
Speaker Devraj Ghimire and Deputy Speaker Indira Rana echoed the urgency, underscoring the need for systematic expenditure, transparent recordkeeping, and a culture of accountability across all tiers of government. “The way we track income and spending is the backbone of a functioning state,” said Ghimire.
Auditor General Toyam Raya clarified that not all arrears signal wrongdoing. Many arise from unverified procurements, pending reimbursements, or lack of documentation, though some may still reflect questionable practices. In FY 2080/81, his office audited 5,700 public entities, revealing the vast scale of the challenge.
PAC Secretary Eakram Giri added that the Committee is committed to digging into the root causes of arrears, not just numbers, and driving measurable reforms in public financial management.
As mandated by Article 294 of the Constitution, the annual audit report moves from the Auditor General to the President, then to Parliament — where the PAC plays a crucial role in scrutiny and follow-up.
With public trust and financial integrity on the line, Nepal’s growing arrears are now at the center of the national accountability debate — not just a fiscal headache, but a litmus test for the State’s commitment to good governance.
