Fiscal Nepal
First Business News Portal in English from Nepal
KATHMANDU: In the face of significant revenue shortfalls and declining treasury balances, the federal government and seven provincial governments have designated a total of Rs 17.35 billion for various projects proposed by lawmakers, raising concerns about unproductive expenditures.
For the fiscal year 2023/24, the federal government plans to distribute Rs 8.25 billion, allocating Rs 50 million to each Member of Parliament (MP). Simultaneously, the seven provincial governments have earmarked over Rs 9 billion for this controversial program.
Under this initiative, lawmakers in each province will receive funding ranging from Rs 12.5 million to Rs 46.66 million for their selected projects. The provincial governments recently announced their budget allocations for the upcoming fiscal year.
The Finance Minister, Prakash Sharan Mahat, has reintroduced the contentious parliamentary development fund under the name of ‘Parliamentary Infrastructure Development Program.’ The fund was previously removed from the budget for the Fiscal Year 2022/23 by the former Finance Minister, Bishnu Paudel.
Minister Mahat has allocated Rs 8.25 billion for the 165 MPs at the federal level, with each MP able to choose a project with an investment cap of Rs 10 million. At the provincial level, the 365 MPs will have the freedom to select projects according to their preferences.
Although the allocated budget is intended for infrastructure projects related to roads, irrigation, drinking water, education, health, tourism, sports, and socioeconomic development, there is a lack of clear guidelines on how the funds will be meaningfully utilized.
Among the provinces, Koshi Province will provide Rs 26.78 million to each of its 56 MPs, Madhesh Province has allocated Rs 36.71 million to each of its 64 MPs, and Bagmati Province has set aside Rs 23.33 million for each of its 66 MPs.
Likewise, Gandaki Province will allocate Rs 20 million to each of its 36 MPs, Lumbini Province will distribute Rs 12.50 million to 52 MPs elected through the electoral system, and Rs 7.5 million to each of the 35 MPs elected through the proportional representation system.
Karnali Province will grant Rs 46.66 million to each of its 24 MPs, while Sudurpashchim Province will provide Rs 30 million to each of its 32 MPs.
The concept of the ‘Infrastructure Development Fund’ originated during the tenure of the late Nepali Congress leader, Sushil Koirala, when he was the prime minister.
The fund was subsequently renamed as the ‘Parliamentary Development Fund’ and the ‘Local Infrastructure Development Partnership Program.’
Under this program, the budget is directly allocated to individual lawmakers of the House of Representatives (HoR) elected through the First Past the Post (FPTP) electoral system.
However, there is growing concern about the distribution of the budget to party workers under the guise of development, raising questions about misuse.
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