Obscure sources cause NRA fund to go unspent

Kathmandu, Dec. 27

The National Reconstruction Authority (NRA) has continuously failed to utilise the budget allocated for the post-quake reconstruction owing to the lack of clarity in securing the money from the specified sources.

It has utilised only 57.5 per cent of the total budget allocated for reconstruction in the last four years.

Rs. 483.6 billion was allocated to the NRA from the fiscal year 2015/16 to 2018/19, but the reconstruction body could use up only Rs. 276.39 billion during the same period.

FY 2017/18 witnessed the highest use of budget with 78.65 per cent. It spent Rs. 114.7 billion from Rs. 145.9 billion budget.

The NRA said that the Ministry of Finance had allocated budget to post-quake rebuilding without resource assurance which raised the questions about the performance of the reconstruction body.

"In reality, it was not the inefficiency of the NRA, but the unavailability of the budget," said Shiva Hari Sharma, Secretary of the NRA. "Initial two years were spent in preparation of various policies, procedures and modalities. However, the reconstruction took speed from 2017/18."

The large part of the reconstruction is covered by the rebuilding of the private houses. The government provided Rs. 300,000 in grant to each family that lost their house in the 2015 earthquake.

About 482,323 houses damaged in the were rebuilt while more than 189,000 are under construction, and 69,973 houses were retrofitted.

"We are in a sort of technical trap since the MoF has done its job by announcing the budget while we failed not get the money since it is from the difficult sources," said Sharma.

While the NRA's tenure is coming to end in December next year, it has abundance of works to perform in the current fiscal year so it has demanded the Ministry of Finance to ensure the availability of funds as per the budget allocation. Finance Minister Dr. Yuba Raj Khatiwada had allocated Rs. 141 billion to reconstruction for the current fiscal.

Of the Rs. 141 billion budget, source of about Rs. 38 billion is not ensured. The money which is not going to the NRA includes Rs. 34 billion from the Indian Exim Bank announced as the line of credit during the International Conference on Nepal's reconstruction in 2015, Rs. 5 billion from the Opec Fund for International Development and Rs. 2 billion from the World Bank.

The Indian funds can't be used due to its condition of spending in projects larger than Rs. 1 billion, using Indian contractor and construction materials since the reconstruction involves many small-size projects such as schools and health facilities while the OFID and WB cancelled their pledges.

However, the MoF said that it was trying to manage funds for reconstruction from other possible sources.

Budget allocation and Utilisation (Rs. in billion)

Fiscal Year	Allocated Budget	Budget Utilisation
2015/16	74.0	22.47
2016/17	112.58	49.69
2017/18	145.93	114.78
2018/19	151.08	89.43
2019/20	141.0	16.86
Total	624.60	293.25

Source: NRA

Published in The Rising Nepal daily on 28 December 2019.