Political infighting, administrative vacancies stall budgets in 13 local units

A governance crisis is unfolding in Nepal as 13 local governments struggle to present their annual budgets, missing the constitutional deadline that marked the start of the new fiscal year. Eight of these local units have not tabled any budget, while five others submitted proposals but failed to secure endorsement or complete necessary administrative entries.

Officials from the Ministry of Land Management, Cooperatives, Federal Affairs and General Administration attribute these significant delays to a combination of factors. Political disputes among elected representatives, prolonged vacancies in the crucial chief administrative officer positions, and various technical and procedural challenges are cited as primary reasons. The problem is most acute in Madhesh province, where 10 of the affected local governments are located, with others in Koshi and Lumbini provinces.

Missing the mid-July deadline plunges these local units into a 'budget holiday.' This leaves them without the legal authority to collect taxes or disburse public funds until their budgets are formally approved. The disruption has stalled routine government work and impacted essential services. For instance, the Chair of Chandranagar Rural Municipality traveled to the capital seeking ministerial intervention to resolve the budget impasse that has plagued his municipality for years due to administrative paralysis.

In stark contrast, local governments in Bagmati, Gandaki, Karnali, and Sudurpashchim provinces successfully completed their budget processes on time. The ministry's data indicates that most local governments in Madhesh and Koshi provinces also managed to endorse their budgets, highlighting the localized nature of this governance challenge.