MoF floats plan for full-fledged budget

KATHMANDU, Aug 22: As the uncertainty on possible date for a new budget for the ongoing fiscal year lengthens further along with deepening political crisis, Ministry of Finance (MoF) has floated a proposal for political consensus for a specific date of budget announcement.



A MoF official told Republica that Finance Minister Surendra Pandey floated the proposal with Speaker Subas Nembang and urged the latter to initiate a concrete step for forging all-party consensus for bringing a full-fledged by the interim government itself.[break]



We have proposed all the political parties to jointly work to announce a full-fledged budget during the third week of September, specifically between 13 and 16, as the present ´installment budget´ has started adversely effecting all major sectors of the economy, said the official. "Our attempt is focused on insulating the economy from possible negative impacts of deepening political uncertainty," the official added.



The MoF has proposed forming an all-party special committee led by the present finance minister to formulate and finalize a new budget and a full-fledged government for the ongoing fiscal year. “We have also proposed that the new government that comes to power after that announcement of the budget can bring changes if it deems so," said the official.



As per the proposal, the MoF is planning to endorse the budget by October 7 and release budgeted amount to concerned agencies before Dashain, Nepal´s greatest festival that begins on 14 October, the official said.



An official with the Budget Division of MoF told Republica that the financial arrangements made through the introduction of a special budget will not be enough to meet recurrent expenditure of the present month.  “Since we have to distribute Dashain bonus that is equivalent to one month´s salary to government employees, the present budget earmarked for recurrent expenditure will be enough for only one more month.” he added.



The lack of full-fledged budget has not only frozen entire development activities of the country but is also eroding confidence of private sector, said the official. "In the lack of clear cut excise and customs polices and rates, even the imports of raw materials and essential commodities and production of various goods have been affected," said Keshab Acharya, economic advisor at the Ministry of Finance.



Meanwhile, Speaker Nembang organized a meeting of major political parties on Tuesday and briefed the leaders about the looming economic consequences if full-fledged budget is not brought soon. The meeting was attended by top leaders of UCPN (Maoist), Nepali Congress, CPN (UML) and four Madhes-based parties.

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