Actual use of capital budget stands at 70.6 per cent

Kathmandu, June 9

 The government has implemented development works worth Rs. 187.3 billion so far this fiscal year.

The Office of the Comptroller General (OAG)'s daily budgetary statistics put the total capital expenditure till Saturday at about 46.11 per cent while the government has a liability of Rs. 65 billion to the contractors for the projects completed.

It puts the total capital expenditure size at 70.63 per cent, though about 24.5 per cent of the money is yet to be paid to the contractors.

"Bills worth Rs. 65 billion of about 4,000 construction companies are pending at various line ministries and government offices," said Roshan Dahal, Secretary General of the Federation of Contractors Association of Nepal (FCAN).

It means that the government needs to spend about Rs. 2.05 billion per day contrary to the media reports that it had to spend about Rs. 3.17 billion per day. However, in terms of the liabilities of the government the figure may stand at Rs. 3.17 billion per day.

Finance Minister Dr. Yuba Raj Khatiwada had unveiled the budget of Rs. 1.315 trillion for the current fiscal and allocated Rs. 313.99 billion for capital expenditure. But during the mid-term review of the budget he revised the targets of the budget and lowered the development budget expenditure target by 15.5 per cent to 265.26 billion.

The implementation of federalism and the programmes handed over to the states and local bodies from the federal government through the budget of the current fiscal year 2018/19 had created confusion in the sub-national governments and delayed the payment of the development projects.

"There was a confusion among the different level of governments about implementing and making payments of the development construction which delayed the money disbursement. The money in pending is primarily of the projects that were handed over to the states from the federal government," said Dahal.

Ministry of Finance (MoF) also said that initially there was some confusion about the programme execution.

However, MoF Spokesperson Uttar Kumar Khatri said that the ministry was not aware about the size of the amount the government needed to pay to the contractors.

"Although there have been the cases of delayed payment due to the failure in submitting receipts in time, we do not have consolidated data. Since the development projects are executed by the line ministries and their agencies at the federal and state levels, the MoF does not have the information about the pending bills," he said.

Dinesh Regmi, Information Officer at the OAG, said that the office also did not have the information about the pending bills. "Our database is created on cash-basis not accrual-basis. Therefore, we only have the information about expenditure when it is paid," he said.

Govt. expenditure status (as of June 8, in Rs. millions)

Budget	Target	Expenditure	Percentage
Total	1,315,161	787,936	59.94
Recurrent	845,447	586,194	69.38
Capital	313,998	144,785	46.11
Financing	155,716	56,956	36.58

Source: OAG

Published in The Rising Nepal daily on 10 June 2019.