KATHMANDU: The Ministry of Federal Affairs and General Administration has decided to facilitate local governments in resolving issues through on-site discussions, aiming for the prompt approval and implementation of their budgets and programs.

Acting on the directive of Federal Affairs and General Administration Minister Bhagwati Neupane, the ministry has assigned joint secretaries and heads of three divisions—Kaliprasad Parajuli, Prakash Dahal, and Rudra Singh Tamang—to lead facilitation teams for this purpose.

To create a conducive environment for this process, the ministry has decided to deploy three separate teams starting from August 6, in coordination with the National Association of Rural Municipalities Nepal, Municipal Association of Nepal, and relevant officials of the District Coordination Committees, as mentioned in a press release.

In a federal system, economic autonomy and financial discipline are key pillars for the empowerment of local governments.

Articles 59 and 60 of Nepal’s Constitution ensure economic rights and the authority to manage revenue sources, granting local bodies financial autonomy.

Article 230 of the Constitution mandates that village and municipal executive bodies must present estimated revenue and expenditure for each fiscal year to their respective assemblies for approval, ensuring financial discipline at the local level.

Similarly, Section 27 of the Inter-Governmental Fiscal Arrangement Act, 2017 requires local bodies to allocate funds from their consolidated fund in the budget, and only spend after it is approved by the assembly.

Moreover, Section 71 of the Local Government Operation Act, 2017 specifies that budgets approved by the executive must be tabled in the assembly by June 24 and passed by mid-July.

Despite these constitutional and legal provisions mandating timely budget approval to ensure good governance and effective service delivery, it has been observed that some sub-metropolitan cities, municipalities, and rural municipalities have yet to approve and implement their annual budgets and programs for the current fiscal year.

According to the Government of Nepal (Allocation of Business) Rules, the Ministry of Federal Affairs and General Administration is responsible for coordination and liaison between federal, provincial, and local governments.

The ministry has stated that it is taking the issue seriously and will facilitate discussions to resolve problems faced by local governments that have failed to approve and implement their budgets on time.