New austerity standard in public spending


The government issued the ‘Standard for Maintaining Austerity Measures in Public Expenditure’ with a view to revitalise the economy hit by the COVID-19 pandemic, increase expenditure for coronavirus infection prevention, control and treatment, and continue under-construction projects.

As per the standard published in the Nepal Gazette on November 23, public entities shall take consent of the Ministry of Finance while tabling a proposal to the Council of Ministers on matters that are not included in the approved annual programmes which impose financial liabilities on the government.

“Public entities and persons holding office shall spend the budget on office goods, stationery, water, electricity and fuel for official purpose in such a way that austerity measures are maintained,” the standard says.

It also requires public bodies to publish their report on their website instead of printing them. “There shall be no duplication of programmes or projects to be co-financed by or operated in partnership with the federal, provincial and local governments.

If there is duplication in the operation of such programme or projects, the MoF shall withhold them immediately,” it reads.

The standard prohibits the purchase of furniture, fixtures and other equipment for existing offices. However, they may be purchased for new offices. Likewise, public entities are required to organise training, symposium, discussion, meetings and interactions online. If it is necessary to hold such progammes in-person, the public entity concerned shall use its own meeting hall or public assembly hall. “Residential training, symposium or workshop shall not be held at the expense of government resources or foreign loans,” it says.

According to the standard, public entities cannot depute a team of more than three employees or office-bearers for monitoring visits. It also stipulates a provision for restructuring or dissolving development boards, commissions, corporations, authorities, enterprises, centres, councils and companies at the provincial and local levels as per necessity.

“No employee, except office assistants and drivers, shall be appointed or hired on contract or daily-wage basis. Public entities shall not be allowed to nominate any employee for training visits or study in foreign countries at the expense of government coffers or foreign loans. However, if it is necessary for public entities to nominate employees to participate in bilateral or multilateral talks and at meetings held by international organisations, they shall take the consent of the MoF prior to nomination,” the standard states.

Similarly, officials using government or his/her private residence shall not be entitled to accommodation expense. The standard has also discontinued uniform expenses, dearness allowance, overtime allowance, hazard allowance, special allowance and lunch or food allowance for officer-bearers and employees, except for health workers and doctors working on the frontline for prevention and treatment of COVID-19.

No vehicle shall be purchased with government resources or foreign loans. However, if it is very essential to purchase a vehicle, the public entity concerned shall obtain the consent of the MoF. The vehicle may not be used outside the jurisdiction of the office concerned, without the permission of a competent authority.

There shall be a six-member high-level monitoring committee led by the chief secretary to carry out monitoring of adherence to the standard. Its other members include secretary at the Office of the Prime Minister and Council of Ministers, secretary at the MoF, secretary at the Ministry of Federal Affairs and General Administration, Financial Comptroller General and secretary at the Public Procurement Monitoring Office.