JANAKPURDHAM: Financial irregularities are rising annually in the Madhesh Province Government as ministries and their subordinate offices fail to maintain financial discipline in public expenditure. In an analysis based on audited amounts, Madhesh Province has recorded the highest amount of financial irregularities among all provinces.

The Auditor General’s Eighth Annual Report, prepared by covering the operations and activities carried out in the fiscal year 2024/25, shows that irregularities have escalated significantly due to weak financial discipline in the expenditures made by the Madhesh Province Government.

Section 2 of the Economic Procedures and Financial Accountability Act, 2019 , and the province’s related laws define irregularities as transactions identified or determined during auditing to have been conducted without fulfilling due processes in accordance with prevailing laws, where accounts were not maintained, or financial transactions were carried out in an irregular or inappropriate manner.

According to the Auditor General’s report for the fiscal year 2024/25, the audit of the ministries and subordinate bodies of the Madhesh Province Government revealed financial irregularities worth Rs. 1.87 billion. This irregularity is the highest on a province-wise basis.

According to the 63rd Annual Report of the Auditor General, the amount of financial irregularities has increased in all seven provinces due to weak financial discipline in government spending. After Madhesh, the irregularity amounts are consecutively higher in Koshi, Lumbini, Gandaki, and Sudurpashchim. Among the provinces, Bagmati has the lowest irregularity amount at Rs. 693.79 million.

Province Ministry of Home Affairs, Communications and Law.

Among the irregularity amounts of Madhesh Province, Rs. 56.03 million needs to be recovered, Rs. 1.37 billion needs to be regularized, and Rs. 449.99 million remains to be cleared as advanced mobilization funds.

The audit of Rs. 49.69 billion has been completed across 150 entities, including provincial ministries, other institutions, and committees. Out of this, irregularities worth Rs. 1.87 billion have been found, as mentioned in the Auditor General’s report. While cumulative irregularities until last year stood at Rs. 9.11 billion, the addition of this year’s figures brings the total outstanding irregularities to Rs. 10.98 billion.

Irregularities are also rising because of the government’s tendency to transfer funds to various projects at the final hours of the fiscal year and spend them in a rush. Section 17 of the Provincial Economic Procedures Act, 2018, stipulates that if funds are insufficient under one budget sub-heading, the secretary of the concerned ministry within the specified limit, and the Ministry of Finance in the case of others, can transfer funds to another budget sub-heading. However, while a budget of Rs. 43.89 billion was approved in the fiscal year 2024/25, a budget transfer of Rs. 1.35 billion took place in July 2025.

Manju Thapa Magar, Chairperson of the Public Accounts Committee of the Madhesh Provincial Assembly, states that irregularities are visible because employees do not pay attention to financial responsibilities. She says, “The tendency to hold unallocated funds and transfer them towards the end of the fiscal year has also increased irregularities. Even though secretaries are held accountable, their attention does not seem to reach this issue. A lack of responsibility is also observed among ministers.”

Ministry of Finance, Madhesh Province

Shailendra Sah, former Finance Minister of Madhesh Province, states that irregularities are seen due to a shortage of employees in the province and a lack of efficiency among the existing staff. “With irregularities continuously rising, this province is on the verge of being discredited,” he says, “Employees do not come here fully skilled; they come and learn on the job. This is what has caused irregularities to rise.”

Which ministry has how much irregularity?

Among the ministries and entities, the Ministry of Physical Infrastructure Development accounts for the highest share of the total irregularities. The irregularity rate of this ministry stands at 59.31 percent.

Following this, the Ministry of Health and Population accounts for 12.37 percent; the Ministry of Home Affairs, Communications and Law accounts for 9.98 percent; the Ministry of Energy, Irrigation and Water Supply accounts for 7.67 percent; and the Ministry of Industry, Commerce and Tourism accounts for 4.13 percent. The irregularities of the remaining other entities stand at 6.55 percent.

Since most documents of the fiscal year 2024/25 were burned and destroyed during the arson that occurred during the Gen Z protests, certain amounts belonging to the Madhesh Provincial Assembly and other entities could not be audited. Among these, the Provincial Assembly stated that records and documents worth Rs. 392.18 million—comprising Rs. 376.75 million in allocation, Rs. 1.19 million in revenue, and Rs. 4.24 million in deposits—were damaged, so that amount could not be audited.

Similarly, due to the burning of records and related documents of the Office of the Chief Minister and Council of Ministers, an audit was not conducted for Rs. 591.40 million—comprising Rs. 86.22 million, Rs. 13.17 million in revenue, Rs. 50.54 million in deposits, and Rs. 441.46 million in other transactions.

After providing the preliminary report showing irregularities of Rs. 1.06 billion in the Ministry of Physical Infrastructure Development and its subordinate bodies, Rs. 12.33 million was cleared, but with an addition of Rs. 5.47 million, the irregularities stand at Rs. 1.05 billion. Out of that, Rs. 422.02 million remains as overdue advances, as mentioned in the Auditor General’s report.

Similarly, after irregularities of Rs. 75.16 million were seen in the Ministry of Industry, Commerce and Tourism and its subordinate bodies, Rs. 1.74 million was cleared through processes following the provision of the preliminary report, but with an addition of Rs. Rs. 30,000, Rs. 73.45 million remains. Out of that, Rs. 100,000 remains as overdue advances.

After irregularities of Rs. 21.85 million were seen in the Ministry of Forests and Environment and its subordinate bodies, Rs. 174,000 was cleared through processes after the preliminary report, leaving a remainder of Rs. 21.59 million. Out of this, Rs. 8.94 million remains as overdue advances.