Govt starts reallocation of financial resources
Kathmandu, April 15
The government, which is under pressure to manage the funds amid low revenue collection, has started reallocating financial resources prioritising to combat the spread of coronavirus and tackle the unfavourable conditions caused by the pandemic.
As a result of complications arising due to the coronavirus pandemic, the government has missed its revenue collection target as of mid-April by Rs 198 billion.
The government had set the target to collect Rs 798 billion in revenue in the first nine months of the ongoing fiscal year, while it was able to collect only Rs 600 billion.
Following resource shortfall, the government has started transferring unutilised budget from different funds to use them to tackle the ongoing crisis situation.
The government today decided to reallocate Rs 16 billion from Rural Telecommunication Development Fund (RTDF) and use the money to combat the pandemic.
The Nepal Telecommunications Authority (NTA) maintains RTDF for development of telecommunication infrastructure, especially in rural parts of the country. The fund currently has almost Rs 24 billion, as per NTA.
Telecommunication service providers are required to contribute two per cent of their annual income to the fund.
“Reallocation of resources is necessary as the government is currently under pressure to manage funds to combat the coronavirus and other unforeseen situations resulting from the pandemic,” said an official at the Ministry of Finance (MoF) seeking anonymity, adding that the government will reallocate resources from other funds, projects and programmes if deemed necessary.
This is not the first time that the government has reallocated resources from RTDF. As the fund often has a sizeable amount of money, the government often uses the resources collected in the fund amid revenue shortage.
A few days ago, the government had also sought support from donor agencies to bridge the resource deficit.
Finance Minister Yubaraj Khatiwada had appealed with the donor agencies for additional funding, including with the World Bank, Asian Development Bank, Asian Infrastructure Investment Bank, International Monetary Fund and International Finance Corporation, among others, to bridge the resource gap and support Nepal to combat the spread of coronavirus.
Similarly, the MoF has already barred government agencies from haphazard spending and expenditure on low priority projects and programmes.
MoF has halted budget spending under 14 different headings, including purchasing vehicles, machinery equipment, furniture, consultancy services, land acquisition, software development and purchase, staff training, skill development and awareness activities and other programmes of low priority.
MoF plans to use the budget allocated for such comparatively less important programmes for containing the spread of coronavirus.
A version of this article appears in e-paper on April 16, 2020 of The Himalayan Times.