EDITORIAL: Federal finance

Provincial governments since have to start from scratch, they need to be equipped with laws, resources,expertise and staff

The National Natural Resource and Fiscal Commission (NNRFC) has urged provincial and local governments to prioritise delivery of basic services to the people and properly allocate resources for the implementation of the projects “transferred to them from the federal government”. The NNFRFC, a constitutional body for implementing the mechanism of inter-governmental fiscal transfers, has said provincial and local governments should follow the provisions set out by the Intergovernmental Fiscal Management Act. As per law, provincial and local governments have to prioritise public service delivery, continuity of the projects transferred from the federal government and salary/allowances of the staffers. However, the local governments have sought additional resources in the current fiscal from the federal government to manage their committed liabilities due to lack of proper allocation on priority basis.

According to NNRFC Joint Secretary Ram Prasad Ghimire, local and provincial governments are autonomous bodies and can formulate their own budget from the grant transferred by the federal government and their internal revenue. The Intergovernmental Fiscal Management Act envisages modalities for fiscal transfers, including establishment of a separate treasury for each level of government and fixes the onus of collecting various taxes and the mode of the distribution to different tiers of government. The NNFRFC call to abide by the rules laid down by the Act stems from the fact that local governments were spending the budget for development and construction, overlooking their need for recurrent expenses.

At this point, what provincial and local governments have been asked regarding their budget seems to be ad-hoc measures and justifiable given the new federal path the country is embarking on. Provincial governments at this time neither have laws nor budget. Provincial governments have to present their budget two weeks after the federal budget, which will be presented on May 28. Local governments have to submit their budget to the respective provincial assemblies 20 days ahead of the fiscal year calendar. Provincial governments since have to start from scratch, as the country is exercising the federal set-up for the first time, they need to be equipped with laws, resources, institutions, expertise, staff and infrastructure. The case is no different with local levels. Even though there were some mechanisms in place, local bodies also lack institutional capacity, for they have remained dysfunctional for years. It will take some time for the provincial and local governments to set up and enhance institutional capacities. One of the main issues the chief ministers from all seven provinces had raised during their meeting with Prime Minister KP Oli was lack of laws. The chief ministers had informed PM Oli that their hands were tied when it came to taking development projects forward because they did not have required laws and regulations. As per the constitution, provincial governments can draft laws related to as many as 21 issues. The federal government must pay attention to these facts. Fiscal federalism is certainly going to be the most challenging issue in coming days.

Curable disease

The World Tuberculosis Day was marked on Saturday with the theme “Wanted: Leaders for a TB-free world”. As per the Sustainable Development Goals, Nepal has to eradicate TB by 2030. However, the new cases of multi-drug resistance TB have turned out to be a major challenge in achieving the SDGs. It is estimated around 1,000 new TB cases are detected in Nepal every year. Out of the 1,000 new patients of TB, 400 receive treatment through DOTS centres.

Multi-drug resistant tuberculosis is a form of TB infection caused by bacteria that are resistant to treatment with at least two of the most powerful first-line anti-TB medications. Irregular medication among TB patients leads to resistance to the first-line anti-TB medications. The World Health Organisation estimates that there surfaced 600,000 new cases worldwide with resistant to rifampicin, the most effective first-line drug. TB is one of the top 20 causes of death worldwide, according to the WHO. Foundation stone for a 300-bed National Chest Disease Hospital was laid at National Tuberculosis Centre, Bhaktapur on Saturday to provide timely treatment to TB patients. TB is curable and preventable provided that patients take medicines regularly.