This year, the budget preparation process in Koshi Province began only 10 days later than scheduled due to the delay in sending the budget limit by the federal government.
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The budget preparation process has finally begun in Koshi Province after receiving the budget ceiling 10 days late from the federal government.
The provincial government was supposed to start the process by Chaitra 15. However, this time, the process is finally starting after the third week of Chaitra has passed since the ceiling was received from the federal government. ‘The process will move forward after receiving the ceiling 10 days late,’ said Sushil Bastola, spokesperson for the Ministry of Economic Affairs and Planning of Koshi Province.
The provincial government’s budget preparation process usually starts from mid-December. In the first phase, the provincial government submits its estimated income and expenditure details to the Ministry of Finance and the Finance Commission. At the same time, a medium-term expenditure structure is prepared, which projects the potential income for the next three years. When preparing the budget for 2082/083, an estimate of how much income can be generated in 083/084 and 084/085 is made in the medium-term expenditure structure.
According to Bastola, spokesperson of the ministry, after this initial process is completed, the budget cycle will move forward. In the month of Magh, project proposals for supplementary and special grants are sought from the federal government. After the federal government issues a notice, the proposal is submitted along with the necessary documents, the final decision of which is made by the federal council of ministers.
Similarly, the provincial government also moves forward the process of distributing grants to the local levels under various headings. In Falgun, notices are called for supplementary and equalization grants and local levels register proposals. At this time, the Revenue Advisory Committee meets and various thematic committees are formed.
‘These committees study how much revenue can be collected from tourism, transport, land revenue and other sectors and in which areas taxes can be imposed,’ says Bastola. ‘The Revenue Advisory Committee, chaired by the Finance Secretary, coordinates the overall work and there is a provision to submit a report by Baisakh 15.’
According to him, the important phase of budget preparation begins in the month of Chaitra. During this period, decisions are made on the equalization grant, revenue sharing, and share of vehicle tax to be given to the local level. The province keeps 60 percent of the vehicle tax collected and distributes the rest to the local level.
Bastola says, ‘A meeting of the Resource Estimate and Expenditure Limit Determination Committee should be held to determine the equalization grant. The committee assesses the overall economic situation and determines the limit of how much budget can be allocated.’ The ministry then submits a proposal to the Council of Ministers and only after approval is it sent to the Finance Commission.’ He said that the commission will also finalize the budget to be given to the local level. This entire process should be completed by mid-Chaitu, said spokesperson Bastola.
The Resource Estimate and Expenditure Limit Determination Committee sets the final limit based on federal grants and internal revenue and sends it to the ministries. Then the ministries enter their budgets through the ‘Province Ministry Budget Information System’.
