4 key ministries show low capital spending

- RAJESH KHANAL, Kathmandu

Mar 19, 2015-

Four key ministries that have been allocated hefty budgets have been poor performers in terms of expenditure. As of the first eight months of the fiscal year, they have been able to spend only Rs 20.51 billion out of their combined budget allocation of Rs 91.43 billion.

The funds set aside for these ministries, namely the Physical Infrastructure and Transport, Urban Development, Federal Affairs and Local Development and Irrigation ministries, represent 78.3

percent of the total capital expenditure of Rs 116.76 billion allocated for development projects for this fiscal year.

Impatient with their slow pace of spending, the parliamentary Public Accounts Committee (PAC) on Thursday summoned the secretaries of the four ministries and demanded an explanation.

The government had allocated a budget of Rs 35.31 billion for the Ministry of Physical Infrastructure and Transport. However, it has been able to spend only 25.61 percent of the amount as of mid-March. Similarly, the Ministry of Urban Development has spent 20.88 percent out of the Rs 25.97 billion it was allocated.

Likewise, the Federal Affairs and Local Development Ministry has been able to spend a meagre 16.39 percent of the Rs 15.20 billion it received and the Ministry of Irrigation has spent 23.84 percent of its budget of Rs 14.95 billion.

Percentage-wise, the performance of the Ministry of Science Technology and Environment has been the poorest among the 15 ministries in terms of capital spending. The ministry has spent a mere 2.22 percent out of its Rs 1.07 billion budget during the review period. The Ministry of Home Affairs has spent the largest amount, 46.26 percent, of the budget allocation.

Providing an explanation to PAC, Chief Secretary Leela Mani Paudyal blamed the low capital expenditure on policy, procedural and coordination flaws.

“Along with the provisions in the Public Procurement Act, the slow process of land acquisition, poor preparation before the project implementation and disruptions in the supply of construction materials, among others, have led to low spending,” he told the lawmakers.

He added that the government was planning to devise a separate assessment mechanism to monitor the performance of its ministries. “We are also developing separate measuring indices for different ministries to evaluate their performance.”

Paudyal said that the government had also been receiving complaints about the quality of the construction on a daily basis. “At a time when the ministries are experiencing low capital expenditure, the quality of the infrastructures constructed and the construction materials are often questioned by stakeholders,” Paudyal said.

According to him, the government has also been developing a system to test the quality of the construction. He added that the government would control the trend of disbursing budgetary funds without completing the necessary process towards the end of the fiscal year to ensure the quality of the construction work.   

Similarly, Auditor General Bhanu Prasad Acharya attributed the low capital expenditure to lack of preparatory work before launching development projects. “We have been issuing payment only after receiving a pre-audit report besides strengthening the audit system at the local level to enhance the quality of development projects,” he said.

Meanwhile, the lawmakers blamed corruption in government offices, political intervention, lack of efficient government officials, flaws in government policies and government laxity with regard to policy implementation for the low capital expenditure.

The government was able to spend only Rs 25 billion (21.41 percent) of the capital budget as of mid-March. Meanwhile, total expenditure amounted to 38.23 percent of the country’s Rs 618.10 billion budget during the same period.

According to the National Planning Commission, 93 out of the 339 first priority projects observed more than 80 percent progress, while 80 projects achieved less than 50 percent progress in the first eight months of the current fiscal year.

Published: 20-03-2015 10:00

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