Kathmandu. The Ministry of Finance has asked all ministries, departments, commissions, provincial and local level bodies to prepare necessary work procedures, guidelines, standards, directives and guidelines for the effective implementation of the budget for the current fiscal year 2083/84.

The budget implementation guidelines issued by the Ministry of Finance on July 15 states that the necessary working procedures and guidelines for the implementation of the programmes included in the approved annual program should be prepared on time and made public on the websites of the bodies concerned within seven days of the approval. If such procedures create additional financial liability, prior approval of the Ministry of Finance is mandatory.

As per the guidelines, the temporary posts required for the operation of approved projects and programs should be approved by the Council of Ministers within mid-July with the consent of the Ministry of Finance. Likewise, directives have been issued to forward the procurement process of projects and programs that create multi-year liability only within the limits of medium-term expenditure structure.

The Ministry of Finance has clarified that the foreign resources allocated for such projects and the government’s ‘matching fund’ expenditure will be withheld on the basis of the headline until the foreign loan and grant agreement becomes effective. In the case of projects with retroactive financing agreement, payment can be made with the consent of the ministry.

If the amount allocated for the budget assistance is not received on time, the account will be adjusted temporarily from the source of the Government of Nepal. In case of new projects and programmes, directives have been issued to spend only after the financial agreement is ascertained effective.

The project management office has to compulsorily send the details of reimbursement to the Office of Auditor General and Public Debt Management Office to demand reimbursement on a regular basis for the foreign-aided projects.

If the reimbursement process is not started within the stipulated time, the release of the next quarter will be stopped and action will be taken against the project chief and account chief for not demanding reimbursement on time, as per the Economic Procedures and Financial Accountability Act, 2076.

The Ministry of Finance has asked the government to run the programmes only within the limits of the allocated budget and not to create any additional financial liability without the consent of the Ministry. Except in case of a disaster, a special decision of the Council of Ministers or an extraordinary situation, additional budget allocation cannot be sought in the first quarter.

According to the Economic Procedures and Financial Accountability Act, 2076, the Accounts Responsible Officer will have the right to transfer the amount under the head of current expenditure within a single grant signal. Provision has also been made by the concerned account responsible officer to make necessary amount transfer and revision activities under the heading of various expenses including employee remuneration, office bearer facilities, social security.

The Ministry of Finance has directed not to take counseling services except in cases where it cannot be completed through the regular structure. Apart from big and complex projects, the services of supervisory consultants have also been asked not to be taken. The consultancy service cannot be used even for the preparation of draft of Act, Rules, Policy, Procedures or Standards. Emphasis has been laid on adopting maximum austerity in water, electricity, communication tariff, fuel, office materials, visits, training, seminars and other administrative expenses and making public expenditure effective.

Prior approval of the Ministry of Finance has been obtained before purchasing new four-wheelers from the allocated budget. Prior approval from the ministry has also been made mandatory for foreign travel.

Directives have been directed to give priority to government buildings that are vacant for the operation of government offices and to rent buildings with minimum facilities outside the main business centres only if government buildings are not available.

All the agencies have been asked to prepare a monthly cash plan for the effective utilization of the government fund and send it to the Ministry of Finance. If the payment of more than one billion rupees is to be made, it should be informed to the Ministry seven days in advance.

It is stated in the budget implementation guidelines that the unspent grant amount should be returned on time by completing the payment process at least seven days before the end of the fiscal year.

It has also directed the government to regularly monitor and review the implementation of the budget and send the progress report along with achievement indicators, implementation problems and measures to resolve the issues to the National Planning Commission and the Ministry of Finance. They have also been asked to compulsorily participate in the budget implementation review meeting to be held every two months.

Likewise, the Ministry has also stressed on adopting measures to reduce the risks by assessing the financial risks that might arise in course of the implementation of projects and programmes, to ensure the effective implementation of large infrastructure projects and to give priority to capital expenditure reform.