Kathmandu, December 3

The National Planning Commission (NPC) — the country’s apex planning body — will begin cost estimation of the programmes that have been submitted by the ministries for next three fiscal years to frame the medium term expenditure framework (MTEF) from next week.

As the ministries have already submitted the details of the programmes going to be executed in the next three fiscals through the different layers of administration — federal, provincial and local — to the apex planning body, the NPC will start homework on planning the budget of the programmes. MTEF is a foundation on which the government will plan the budget for the next three fiscal years. The NPC has been expediting the works to develop the MTEF as Section 17 of Intergovernmental Fiscal Transfer Act has a mandatory provision for MTEF.

The NPC will come up with the required budget estimation to execute the projects/programmes going to be implemented from the different layers of the government. The provincial and local level administrations will get the consolidated grant from the central government to execute the programmes. While submitting the programmes/projects for next three fiscals, the ministries have segregated them according to the different layers of the government through which programmes will be implemented.

“We will have a tentative idea on the needs of resources for provincial and local governments for next three years after analysing programmes submitted by ministries,” said Khom Raj Koirala, joint secretary of NPC.

Though the Natural Resources and Fiscal Commission is responsible to allocate the grant amount for the provincial and local level, the NPC will be allocating the resources for next fiscal budget based on the programmes proposed by the ministries for lower level administration in the absence of the commission. It is reported that the new government, which will be formed after election, will set up the commission.

The apex planning body has said that it will examine the gravity of the projects based on the scorecard designed by the NPC and classify them as top priority (P1), P2 and P3 projects, according to Koirala. NPC is authorised to set priority only for national level projects or projects going to be implemented by the central government. Likewise, provincial and local units have authority for planning and budgeting and the programmes will have to be endorsed from the provincial parliaments and local level assemblies, respectively.

The NPC will also interact with ministries while finalising the projects, especially with those which mobilise a large chunk of the development budget, as per Koirala. After developing the MTEF, the NPC will have real budget planning of next fiscal and tentative budget breakdown for next two fiscals.

After developing MTEF by the end of December, the NPC will give the ceiling for the ministries and the ministries will have to enter the programmes  of next fiscal to the Line Ministry Budget Information System (LMBIS). LMBIS is a web-based system developed by the Ministry of Finance for the line ministries to prepare annual budget and procurement plan.  The NPC, Ministry of Finance and the line ministries will sit for talks to finalise the projects/programmes proposed by the ministries and the programmes and procurement plan entered in LMBIS will be finalised through tripartite discussions between March 5- 29, as per NPC.

The MoF can further work on scheduling and rescheduling projects from March-end till first week of May. As per the mandatory provision of the constitution, government has to present budget for next fiscal to Parliament by May 29 next year.