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Grants hiked‚ MoFALD to monitor local bodies

  Aims to bring improvement in governance system and performance


KATHMANDU: The Ministry of Federal Affairs and Local Development has started monitoring the local bodies with the aim to improve the governance system and performance at the local level.

“Not a single penny will be allocated nor will any plan be enforced from the centre for the local bodies from this year as per the spirit of the Local Governance Act 2055 BS,” said Shanta Bahadur Shrestha, Secretary at the MoFALD, adding, “This year onwards, the budget will be sent to the local bodies without mentioning any plan.”

“The local bodies will select the plans themselves and distribute the budget accordingly. So, we need to strictly monitor the local bodies being handled by the government officials in the absence of elected representatives,” he said.

Corruption and fiduciary risks are very high in the local bodies, according to the MoFALD officials. The procedures for periodical plans in DDCs, municipalities and VDCs, fiduciary risk management, local governance and transparency are in the pipeline.

“We will focus on making the local level work transparent and will practise decentralisation policy properly in the local bodies,” said Shrestha, who is now in on-field monitoring. “That’s why we have begun to monitor and facilitate the local bodies early this fiscal year in a bid to improve performance,” he added.

In the past, local development minister could directly allocate Rs 500 million from the centre in the name of people’s participatory programmes, according to the MoFALD. Moreover, Rs 100 million and Rs 200 million allocated by the centre used to be distributed in the Tarai and Karnali regions.

The ministry used to distribute budget from the centre for programmes such as agricultural roads, irrigation, drinking water and sanitation. Of the total cost of the programme, the ministry used to provide 60 per cent of the budget to the local bodies as grant and 40 per cent after allocating programmes from the centre.

The government has allocated Rs 46.5 billion to the local bodies in the current fiscal year. Since the local bodies have been running without elected representatives for more than a decade, the government has increased the grants provided to the local bodies.

Each of the VDC will receive Rs 1.5 million as minimum grants while each DDC and municipality will get Rs 4 million and Rs 3 million as minimum grants, respectively. The additional grants will depend on certain indicators such as population. Each VDC will get up to Rs 4.6 million — Rs 1.6 more than in earlier years — in the current fiscal year.

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