Finance Ministry gives clarity on provincial government grants
Provincial governments that have allocated budget for constituency development programme can use funds provided by the centre except resources allocated under conditional grant, the Finance Ministry has said.
Provincial governments that have allocated budget for constituency development programme can use funds provided by the centre except resources allocated under conditional grant, the Finance Ministry has said.
The federal government has allocated Rs 6.6 billion to 165 constituencies with each receiving Rs40 million.
Some people had doubts whether provincial governments could use funds allocated by the centre or use their own to fund constituency development projects.
Except provinces 3 and 4, other five provinces have allocated budget under the constituency development. A combined amount allocated by five provincial governments adds to Rs3.98 billion.
The centre allocates funds to provincial governments under four headings - fiscal equalisation grant, conditional grant, complementary grant and special grant.
Finance Ministry Budget Division Chief Nirmal Hari Adhikari said provincial governments may use funds from three headings except conditional grant that has a caveat that it should be spent for specific purposes.
“Except conditional grant, the provincial governments are free to use the grants provided by the federal government and resources generated by the provincial governments as per their wish,” said Adhikari.
Of the total budget of Rs206.77 billion announced by seven provincial governments for the fiscal year 2018-19, the centre has allocated Rs113.43 billion, excluding complementary grant and special grant.
The central government has sought to mobilize the resources for constituency development by the centre and provincial governments in an integrated manner with financial contributions from local governments.
Following the three-tier governments, the federal government has named the programme as ‘Local Infrastructure Development Partnership Programme.
Federal, provincial and locally elected representatives would implement the programmes, as stipulated by the budget.
The project will be selected and monitored by a committee comprising Federal Parliament member of that particular constituency, members of provincial assembly and heads of local level shall select and monitor the project. A directly elected member of Representative Assembly shall co-ordinate the project.
This programme stipulates a maximum of five projects related to road, potable water, irrigation and river control in one constituency.
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