The problem surfaced mainly because the government, in course of its struggles over the new budget, announced the budget amount without working out the spending programs for all the ministries. [break]Rather, it allotted a lump-sum budget for each ministry and asked them to identify their programs and allocate the spendings themselves.
“Ministries have not yet forwarded their programs and spending plans. So, we are still unaware how much they (ministries) are spending and for which purposes. In such a situation, how can we authorize the financial comptrollers to issue checks for payments?” said a source at MoF.
Till last year, the government used to make public its Estimates of Expenditure, also termed the Red Book, simultaneously with the budget announcement. As this document contains all the details of allocations for each and every program that the government is implementing, the ministries and agencies under them would easily know how much budget has been allocated for which program, what the priority of a given program is, from where the budget is being sourced and how much has been allocated for recurrent and development expenditures, among other things.
“But owing to the unique situation this time, we could not carry out these steps, and allotted a lump sum budget for each ministry,” said Lok Darshan Regmi, chief of Budget Division at MoF.
He said MoF has already written to the ministries to work out how much they are to spend for their respective programs and forward the expenditure breakdowns (under heads such as salary, procurement of stationery, fuel and other daily requirements) as soon as possible.
Unless the ministries completed this task speedily, officials said government offices might not be able to carry out regulation functions and pay salaries to staff.
“The earlier the ministries forward their programs and spending breakdowns the earlier will the impediment end. Everything rests on how fast they complete this task,” Joint Financial Comptroller Suresh Pradhan told Republica.
However, officials said the ministries are in a mess because they are not used to such work and have trouble performing it.
Moreover, the mess has been compounded because the government, regardless of what it said while announcing the budget, has not even allotted to the ministries amounts equal to what they actually spent last year.
“The budget allotted to the ministries is less than last year´s actual spending by 12 to 28 percent. This has created difficulties for us in continuing even the programs iniated last year,” said a senior accountant at a ministry, requesting anonymity.
Regmi denies such a situation, but sources involved in budget-making confirmed what the senior accountant said. Citing an example, they said the government has allocated Rs 30 billion to the Ministry of Local Development for 2012/13, whereas it had received Rs 45 billion in 2011/12 and actually spent Rs 34 billion.
“Such cuts have happened for all the ministries because we had to set aside Rs 3 billion for fresh elections and another 3 billion for army integration, among other things,” said the source. “A bulky amount has also been set aside for implementation of the load-shedding reduction program,” the source elaborated.
Worse still, such a situation has created a lacuna whereby ministries can now reshuffle priorities and make imprudent allocations. “This is certain to hit genuine development projects,” said the MoF source.
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