At
a time, when there is no legitimate oversight agency that can check and balance
the government's expenses, the current fiscal year's budget is looking at a
whopping surplus of over Rs 82 billion.
The UCPN-Maoist led government's inability to spend development expenditures till the 11th month has swollen the central bank's treasury by Rs 52 billion and by the end of the current fiscal year — within July 15 — the government is mobilising above Rs 30 billion in the revenue, making a total of over Rs 82 billion surplus.
The economists, however, suspect 'gross financial indiscipline' that will not only hike prices but also add fuel to the informal economy — that is already as big as formal economy — hurting the country.
"Since there is no legitimate agency to check and balance the government expenditure, the huge surplus will be misused by the government," said former vice chair of National Planning Commission Dr Jagadish Chandra Pokharel.
The government had allocated Rs 72.61 billion for the capital expenditures and Rs 266.61 billion for the recurrent expenditures in the current fiscal year's budget of Rs 384.90 billion. But the government has revised the capital expenditure downwards to Rs 65 billion during the mid-term budgetary evaluation due to slow performances of the development projects and government's inability to spend.
The recurrent expenditures are the regular administrative expenses and salaries, whereas the capital expenditures is spending on development works that could have created employment and economic activities in the local level.
"By the end of the 11th month (mid-June), the government has been able to spend only Rs 31.76 billion on cash basis," according to finance secretary Krishna Hari Baskota. "If the commodity grants and direct payment from the donors of Rs 8.59 billion is also added to the capital expenditure, it will add up to Rs 40.35 billion that is 56 per cent of the total capital expenditure," he said, adding that the Finance Ministry has, however, recalculated the expenses to zoom up by the end of 12th month as the ministries have yet to submit the detail expenses.
"The budget will be spent according to the government's estimation," Baskota claimed.
But Pokharel suspected that the government's motive. "Like in the last fiscal years, the ministries arbitrarily distribute the budget in unproductive way, apart from non-budgetary expenses in the last month," he said, adding that the current government that has already announced election claiming to get two-third majority has more chances to misuse the surplus budget to gain the votes.
In absence of the parliament and parliamentary committees like Public Accounts Committee (PAC), the UCPN-Maoist led government will misuse the surplus budget by distributing to the party cadres," said senior economist Prof Dr Bishwhambher Pyakuryal.
"The financial indiscipline will cost the country heavily as it will fuel inflation," he said, adding that the government's move to distribute its resources will also add fuel to the informal economy.
Despite the surplus, the government has recently borrowed some Rs 9 billion domestically squeezing the resources for private sector that will find it hard to get loan, the senior economist said, the private sector's low borrowing capacity will again hit the economy.
The UCPN-Maoist led government's inability to spend development expenditures till the 11th month has swollen the central bank's treasury by Rs 52 billion and by the end of the current fiscal year — within July 15 — the government is mobilising above Rs 30 billion in the revenue, making a total of over Rs 82 billion surplus.
The economists, however, suspect 'gross financial indiscipline' that will not only hike prices but also add fuel to the informal economy — that is already as big as formal economy — hurting the country.
"Since there is no legitimate agency to check and balance the government expenditure, the huge surplus will be misused by the government," said former vice chair of National Planning Commission Dr Jagadish Chandra Pokharel.
The government had allocated Rs 72.61 billion for the capital expenditures and Rs 266.61 billion for the recurrent expenditures in the current fiscal year's budget of Rs 384.90 billion. But the government has revised the capital expenditure downwards to Rs 65 billion during the mid-term budgetary evaluation due to slow performances of the development projects and government's inability to spend.
The recurrent expenditures are the regular administrative expenses and salaries, whereas the capital expenditures is spending on development works that could have created employment and economic activities in the local level.
"By the end of the 11th month (mid-June), the government has been able to spend only Rs 31.76 billion on cash basis," according to finance secretary Krishna Hari Baskota. "If the commodity grants and direct payment from the donors of Rs 8.59 billion is also added to the capital expenditure, it will add up to Rs 40.35 billion that is 56 per cent of the total capital expenditure," he said, adding that the Finance Ministry has, however, recalculated the expenses to zoom up by the end of 12th month as the ministries have yet to submit the detail expenses.
"The budget will be spent according to the government's estimation," Baskota claimed.
But Pokharel suspected that the government's motive. "Like in the last fiscal years, the ministries arbitrarily distribute the budget in unproductive way, apart from non-budgetary expenses in the last month," he said, adding that the current government that has already announced election claiming to get two-third majority has more chances to misuse the surplus budget to gain the votes.
In absence of the parliament and parliamentary committees like Public Accounts Committee (PAC), the UCPN-Maoist led government will misuse the surplus budget by distributing to the party cadres," said senior economist Prof Dr Bishwhambher Pyakuryal.
"The financial indiscipline will cost the country heavily as it will fuel inflation," he said, adding that the government's move to distribute its resources will also add fuel to the informal economy.
Despite the surplus, the government has recently borrowed some Rs 9 billion domestically squeezing the resources for private sector that will find it hard to get loan, the senior economist said, the private sector's low borrowing capacity will again hit the economy.
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