Govt issues guidelines to public offices to improve capital spending

KATHMANDU: The government has sent budget implementation guidelines for the fiscal year 2024/25 to all ministries, and provincial and local governments.

The Ministry of Finance issued a circular on Tuesday, providing instructions to government offices on adopting austerity measures in budget expenditure and increasing spending effectiveness and efficiency.

The guidelines cover topics such as spending authority, program approval and budget allocation, program/project transfer and implementation, budget expenditure, budget reallocation, program amendment and reporting, financial transparency, accountability, and monitoring arrangements.

According to the guidelines, if an agency has been allocated funds from more than one source, the head of that agency must provide a source-wise breakdown of the allocated amount to the spending agency, along with the expected results and achievements, by mid-October. This information should be shared with the Ministry of Finance and the relevant Financial Comptroller General Office.

Similarly, procedures for implementing plans and programs that have received budget for the current fiscal year must be prepared by the end of the first month of the fiscal year i.e. mid-August. “Procedures necessary for implementing programs included in the approved annual program and allocated funds must be prepared by mid-August,” the guidelines state.

These procedures must be posted on the website within seven days of approval.

The circular also requires offices to obtain approval from the Ministry of Finance when creating procedures that generate additional financial liabilities or long-term obligations.

Similarly, the guidelines have instructed offices overseeing national pride projects to work in two shifts. It states that project chiefs should be selected based on internal competition to effectively implement projects and complete them on time. “A criterion should be prepared and implemented to not transfer project chiefs during the project period unless they fail to achieve the minimum score set in the performance agreement,” it added.

The directive also instructs government offices not to proceed with the implementation process for programs and projects not included in the budget for the current fiscal year.

The ministry has also facilitated public offices for the payment of liabilities created in the previous fiscal year through these guidelines.

“For liabilities created in the previous fiscal year 2023/24 in the construction of roads, bridges, irrigation and sanitation infrastructure, drinking water projects and other public construction works and certified by the Financial Comptroller General Office, payments can be made from the allocated amount in any quarter of the relevant project or program,” the guidelines state.

This provision has paved the way for public offices to release payments to construction entrepreneurs for completed works.
Construction workers say the government owes construction companies more than Rs 25 billion for public works completed in the previous fiscal year.