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| Kathmandu, Saturday February 22, 2003 Falgun 10, 2059. |
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Govt mulling special packages
to boost development expenses
By Prem Khanal
KATHMANDU, Feb 21 : Beset by the record-low
half-yearly development expenditures, the government is preparing to initiate special
packages to boost its expenditures through especially designed programmes.
The government has been compelled to draft such
programmes after the mid-term budget evaluation reckoned that the actual development
expenditure was far less than the allocated amount.
A high-level government source informed The
Kathmandu Post that the government is mulling to bring some changes in the allocated
development expenditures by shortening the current budget release channels and simplifying
the procedures.
Dr Shankar Sharma, vice-chairman of the National
Planning Commission (NPC) confirmed the preparation and added that the proposed packages
expected to be completed next week, would lay special focus in the quick release of
budgets that have been frozen due to security reasons.
The mid-term budget evaluation that the Ministry
of Finance (MoF) is about to complete, has painted a bleak picture, as the aggregate
development expenditures have been just around Rs 7 billion, which is less than 20 per
cent of the total allocation of Rs 38 billion.
Of the total expenditures, the government has
contributed just Rs 2 billion, while the rest came from the donors funding. Analysing the
current trend, the evaluation has also revised the estimated total development expenditure
for the current year to Rs 31 billion.
The latest plunge of almost Rs 7 billion in the
development expenditures has come against the repeated assurance from Finance Minister
Badri Prasad Shrestha that the government would do everything to ensure full expenditures
of the development budget.
Apart from the districts that have serious
security problems, the level of expenditures is even below the expectation even in the
districts with less security problems. Not only the development activities, but also the
infrastructure established by development agencies have been badly affected due to the
frail security condition. "The necessity of the special programmes is the need of the
hour to kick start the almost frozen rural development activities," Dr Sharma added.
The evaluation has also underlined the need of
special attention to boost the development expenditures to explore the opportunity
emanated from the cease-fire. A high-level source of the Ministry of Finance said that the
total expenditures could scale up to Rs 31 billion, if the government takes appropriate
and immediate measures. The optimistic amount, however, is Rs 2 billion more than NPC’s
estimation.
Despite all difficulties, the government is
committed for full expenditures to ensure priority-one projects, categorised under Medium
Term Expenditure Framework (MTEF). The government for the current fiscal year has
identified 184 projects that have the direct link with the anti-poverty programmes.
Apart from identifying the current problems, the
mid-term evaluation has also made a number of suggestions to contain rising regular
expenditures and to raise targeted revenue. Prior to the declaration of cease-fire,
Ministry of Defence had demanded Rs 2.43 billion while public enterprises have been asking
for around Rs 1 billion of extra non-budget.
Dragged down by the low revenue mobilisation,
the evaluation has also downgraded the budgetary target of Rs 57 billion to Rs 54 billion,
but knowledgeable persons said that even the revised target seems difficult to achieve
given the continuing wonky economic condition.
Despite the low revenue mobilisation, the
regular expenditure has shown no sign of lowering. During the period, the regular
expenditure has swelled and touched Rs 26 billion and it could easily touch the allocated
regular expenditures.
Breaker
The mid-term budget evaluation has downgraded
estimated economic growth rate to 2.5 per cent against the budgetary target of 4.3 per
cent. Pessimistic performance of major exportable industries and record-low development
expenditures are among the major factors that forced the government to lower the growth
rate. Shattered by escalating Maoist violence and global economic downturn, the economy
had recorded a negative growth rate of 0.63 per cent.
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