Finance Minister Dr Ram Saran Mahat presented a Rs 143.91 billion budget for the fiscal year 2006/07 on Wednesday.
Reading out the budget at the House of Representatives, Mahat said the budget is focused on institutionalising democracy, establishing peace, election to constituent assembly and reconstruction and resettlement.
He announced to increase the Rs 0.5 million annual grant provided to each Village Development Committee to Rs 1 million and earmarked Rs 1.25 billion for election to constituent assembly. Mahat told the parliament that citizenship certificates would be distributed to Terai people, who have been deprived of citizenships, before the constituent assembly election.
Against the backdrop that the Maoists have been demanding immediate dissolution of the parliament, the Finance Minister proposed to give continuity to Election Constituency Development Programme as per which certain amount would provided to MPs to spent on development programmes in their respective constituencies.
Of the total Rs 143.9 billion, Rs 79.64 billion has been allocated for regular expenditure and Rs 64.276 billion for development programmes. “The estimate of expenditure is higher by 21.3 percent, 56.2 percent, 6.8 percent in capital expenditure, recurrent expenditure and repayment of principal amount respectively and the total expenditure is higher by 28.4 percent as compared to revised estimate of Fiscal Year 2005/06,” the budget paper stated.
Out of the estimated expenditure, Rs 80.825 billion will be borne from the current source of revenue, Rs 23.73 billion from foreign grant and Rs 16.97 billion from foreign loan. There will be a deficit of Rs 22.45 billion.
The government has downsized the annual expenditure of the Royal Palace by 45.8 percent, limiting it to Rs 219.6 million from Rs 405 million last year. The palace had received an extra amount of Rs 340 million last year from the previous government, according to the Finance Minister.
The government has allocated a total of Rs 52 billion for the social sector including Rs 22.66 billion for education, Rs 9.3 billion for health, Rs 6.19 billion for drinking water, Rs 8.81 billion for the overall power sector, Rs 4 billion for irrigation and water-induced disaster prevention programs. Similarly, Rs 7.71 billion has been earmarked for road construction and maintenance, Rs 3.96 billion for agricultural development and Rs 920 billion for judicial sector. Programmes worth Rs 100 million will be initiated for empowerment of women.
The government said the defence expenditure “cannot be decreased unless the number of Nepal Army cadres, which has been increasing for the last four years, is reduced to a given level”. The vacant positions would be made redundant automatically so that the cost comes down, the budget paper said.
The government offered 10 percent dearness allowances to civil servants and increased the monthly allowance for elderly to Rs 200 from Rs 150.
A sum of Rs 1.25 billion have been allocated to Poverty Alleviation Fund in the next fiscal year. The sum will be spent for 667 income generating programs, 369 community infrastructure development programs and some 1700 ‘creative programs’ in 1200 VDCs of 25 districts including 7 districts of far-western and 10 districts in mid-western districts.
The Finance Minister also proposed development and employment-generating plans for the backward Karnali region and allocated Rs 1.1 billion for reconstruction of destroyed physical structures and for assistance to the families of those killed during the 10-year armed conflict.
He said that after the successful conclusion of ongoing talks between the government and the CPN (Maoist), a large number of Maoist cadres would have to be assimilated into the national mainstream for which special programs for rehabilitation and income-generation would be launched.
The Finance Minister said the budget was formulated as per the aspirations of the people and suggestions of the political parties but there were limitations in addressing the aspirations and suggestions to the fullest due to resource crunch.
Reading out the budget at the House of Representatives, Mahat said the budget is focused on institutionalising democracy, establishing peace, election to constituent assembly and reconstruction and resettlement.
He announced to increase the Rs 0.5 million annual grant provided to each Village Development Committee to Rs 1 million and earmarked Rs 1.25 billion for election to constituent assembly. Mahat told the parliament that citizenship certificates would be distributed to Terai people, who have been deprived of citizenships, before the constituent assembly election.
Against the backdrop that the Maoists have been demanding immediate dissolution of the parliament, the Finance Minister proposed to give continuity to Election Constituency Development Programme as per which certain amount would provided to MPs to spent on development programmes in their respective constituencies.
Of the total Rs 143.9 billion, Rs 79.64 billion has been allocated for regular expenditure and Rs 64.276 billion for development programmes. “The estimate of expenditure is higher by 21.3 percent, 56.2 percent, 6.8 percent in capital expenditure, recurrent expenditure and repayment of principal amount respectively and the total expenditure is higher by 28.4 percent as compared to revised estimate of Fiscal Year 2005/06,” the budget paper stated.
Out of the estimated expenditure, Rs 80.825 billion will be borne from the current source of revenue, Rs 23.73 billion from foreign grant and Rs 16.97 billion from foreign loan. There will be a deficit of Rs 22.45 billion.
The government has downsized the annual expenditure of the Royal Palace by 45.8 percent, limiting it to Rs 219.6 million from Rs 405 million last year. The palace had received an extra amount of Rs 340 million last year from the previous government, according to the Finance Minister.
The government has allocated a total of Rs 52 billion for the social sector including Rs 22.66 billion for education, Rs 9.3 billion for health, Rs 6.19 billion for drinking water, Rs 8.81 billion for the overall power sector, Rs 4 billion for irrigation and water-induced disaster prevention programs. Similarly, Rs 7.71 billion has been earmarked for road construction and maintenance, Rs 3.96 billion for agricultural development and Rs 920 billion for judicial sector. Programmes worth Rs 100 million will be initiated for empowerment of women.
The government said the defence expenditure “cannot be decreased unless the number of Nepal Army cadres, which has been increasing for the last four years, is reduced to a given level”. The vacant positions would be made redundant automatically so that the cost comes down, the budget paper said.
The government offered 10 percent dearness allowances to civil servants and increased the monthly allowance for elderly to Rs 200 from Rs 150.
A sum of Rs 1.25 billion have been allocated to Poverty Alleviation Fund in the next fiscal year. The sum will be spent for 667 income generating programs, 369 community infrastructure development programs and some 1700 ‘creative programs’ in 1200 VDCs of 25 districts including 7 districts of far-western and 10 districts in mid-western districts.
The Finance Minister also proposed development and employment-generating plans for the backward Karnali region and allocated Rs 1.1 billion for reconstruction of destroyed physical structures and for assistance to the families of those killed during the 10-year armed conflict.
He said that after the successful conclusion of ongoing talks between the government and the CPN (Maoist), a large number of Maoist cadres would have to be assimilated into the national mainstream for which special programs for rehabilitation and income-generation would be launched.
The Finance Minister said the budget was formulated as per the aspirations of the people and suggestions of the political parties but there were limitations in addressing the aspirations and suggestions to the fullest due to resource crunch.
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