September 8: Altogether 51 local units across the country have not yet been able to come up with their budget for the current fiscal year (FY) 2023/24. According to the Inter-Governmental Fiscal Arrangement Act 2074, the local bodies across the country must unveil the budget for the next fiscal year by June 25. The Ministry of Federal Affairs and General Administration has informed that 51 local levels out of 753 across the country have not yet announced the budget.

The local government cannot spend budget from the accumulated funds without endorsing the budget. Auditor General will raise questions if spending is done without passing budget. The National Natural Resources and Fiscal Commission also cuts the subsidy of the local level that does not bring the budget on time.

According to the ministry, there are four municipalities in Koshi province, 36 in Madhesh Province, 3 in Bagmati Province, 2 in Gandaki Province, 3 in Lumbini Province, 1 in Karnali Province and 2 in Far West Province that have not yet unveiled their budgets.

Most of the local levels that have failed to unveil the budget for the current fiscal year within the constitutional deadline fall in Madhes Province.

There is no consensus in forming the budget especially when the mayor of a particular local body belongs to one political party and the other parties have majority in the executive body.

Purushottam Ghimire, chief administrative officer of Kanchanrup Municipality of Saptari, said that the budget has not been announced due to lack of consensus.

“The people’s representatives have not been able to reach an understanding to announce the budget. Efforts are being made to reach an agreement," he said.

Rajviraj and Hanumannagar Kankalini municipalities of Saptari and Chinnamasta, Mahadeva, Rupni and Balan-Bihul Rural Municipality are also unable to bring the budget due to internal disputes among the people’s representatives.

Sirah has a similar problem. Kalyanpur Municipality of Siraha and Aurhi, Navrajpur and Bhagwanpur Rural Municipality have not announced their budget. Kamala Municipality of Dhanusha, Dhanauji Rural Municipality and Sonama Rural Municipality of Mahottari have not announced their budget as well. Sarlahi's Balra, Hariwan and Haripurwa municipalities and Chandranagar Rural Municipality have not announced their budget either. It has raised questions about the responsibility and good governance of the local level.

The local governments cannot spend money from the accumulated fund until the budget is passed by the Municipal Council. It is illegal for the local level to spend the budget without passing the budget. Joint secretary of the federal affairs ministry, Kamal Prasad Bhattarai, says that the local level is not serious about this arrangement.

According to him, if the budget is not brought on time, the local government will not be able to spend the budget. As the local governments are autonomous, the federal government cannot legally punish those who do not announce the budget on time. In this case, the program implemented by the local government is affected.