Karnali struggles to spend budget

SURKHET: Karnali has been unable to fully utilize its allocated budget since the formation of the provincial government in 2017.

According to the Province Financial Comptroller Office, Surkhet, the province government has managed to spend only about two-thirds of its total budget in average. In the fiscal year 2019/20, the government spent 49.14% of its budget. Likewise, in 2020/21, only Rs 22.1 billion, or 65.52%, of the allocated Rs 33.74 billion was expended.

The province government could spend only 62.37% of the allocated budget in 2021/22. Out of the total budget of Rs 36.54 billion – Rs 14.89 billion for recurrent expenses and Rs 21.16 billion for capital expenditures, only Rs 24 billion was spent.

The trend continues in subsequent years. In 2022/23, the government spent 67.89% of its budget. Likewise, in 2023/24, only 60.34%, or Rs 20.15 billion out of the allocated Rs 33.4 billion, was utilized.

The current fiscal year has shown no significant improvement in budget implementation as only 6%, or Rs 2.22 billion, of the allocated Rs 31.41 billion has been spent in the first quarter which ended in mid-September.

Recurrent Expenditure Rising

Data shows a growing trend of recurrent expenses in Karnali. This increase has been attributed to the luxurious lifestyle of public representatives, unnecessary spending, office maintenance, and a growing number of employees.

The recurrent budget of the province government has grown from Rs 6.21 billion in 2018/19 to NPR 13.69 billion in 2019/20, and Rs 14.67 billion in 2020/21. The province government has allocated Rs 14.89 billion in 2021/22, Rs 13.12 billion in 2022/23, Rs 13.80 billion in 2023/24 and Rs 13.84 billion in the current fiscal year as recurrent expenditure.

Why Isn’t the Budget Being Spent?

Economic experts attribute the budget implementation challenges to several factors. They point out a tendency to propose low budgets for confirmed projects while increasing the number of new projects.

Bala Kumar BK, an economics teacher based in Surkhet, highlighted the lack of timely procedures, guidelines and standards as key obstacles. “First, there must be clarity on budget allocation. Currently, the budget seems to be allocated to unproductive sectors which hinders implementation,” BK explained.

He suggests that the province government focus on production-oriented plans and monitoring to improve budget execution.

Likewise, Dr Sudip Thakuri, Dean of the Science Faculty at Midwestern University, attributed low spending to a lack of spending capacity. “The province lacks the capacity to effectively spend its budget,” he said. “The tendency to create budgets based on arbitrary decisions further affects budget implementation.”

(Translated from RSS)