‘Budgetary reform need of the hour’
Himalayan News Service
Kathmandu, January 7:
Following a change in budgetary system from the current fiscal year making current and capital expenditure from regular and development expenditure, experts and economists have commented that the timely budgetary reform is the need of the hour to effectively manage spendings. According to a report prepared by Centre for Economic and Development Administration (CEDA) and International Economic Society of Nepal (IESON), budgetary reform has to be expedited in a changed context.
Various experts in the paper have suggested to make the budget considering the changed economic environment. Dr Bimal Koirala, chief secretary was quoted as saying in the report that some projects need ten million rupees for their accomplishment but just hundred thousand rupees per year is allocated which is an irony. And the project also does not get ‘accomplished’ in time.
With the introduction of the Medium Term Expenditure Framework (MTEF), the size of the project has gone down and funding for the prioritised project has gone up which has been termed as the significant achievement in the budgetary management. Despite the budgetary reform initiated about half decade ago, the results have been not very fruitful, thanks to very disastrous and very adverse situation in the country, states the report.
The major objective of budgetary reform is to bring ‘allocative and operation’ efficiencies. The report asked, there is a need to look for allocative efficiency aspects on ‘how could we get the best value for money?’ Expenditure checking system, public and fiscal audit system should also be introduced though they are in a initial stage, states the report.
Experts opined that the reform process will certainly pave the way towards productive utilisation of resources. It is all affected by non-economic factors that need improvement.
Mahesh Agrawal, former president of Nepal Chamber of Commerce (NCC) has commented in the report that government raised tax for increasing development activities but is spent on regular expenditure.
He suggested that development oriented budget should be formulated in such a way that the taxpayers can be convinced the tax amount they paid is used in the development activities. He was of the opinion that it is better to impose ‘accumulated tax’ instead of various taxes such as agriculture taxes, security taxes and sport taxes.