Nepali Times Asian Paints
ARTHA BEED
Strictly Business
Present continuous tense


ARTHA BEED


Last year the Beed had given the budget the benefit of the doubt ('Making the grade', #155). However, now thoughts are similar to a column in this space a year before that ('Who needs a budget?', #102). The budget has again become an isolated document taken up each year that harps on and on in the present continuous tense of "will do" or "shall do".

This year, transparency of election funding, the Beed's favourite item last year, has disappeared. Propagating private-public infrastructure partnerships gets lip service, as it did last year and probably will in the years to come. Clearly, making some changes in this yearly budget ritual is essential.

The April Fool's Day announcement of the new Income Tax Act proved that if the government or the donor community wants, major policies can be pushed even outside the framework of the budget. Similarly, as security expenditure takes top priority, budgetary control mechanisms are neglected. How can budgets be meaningful if the state pumps money into parasitic parastatals? In many state-owned enterprises, audits have been pending for years. And when the government is clueless about the country's future, debt servicing obligations and the total multilateral and bilateral contributions for development, how can the budget be a true reflection of the treasury's cash flow?

In fact, why even bother with this annual ritual, when every budget announcement sees a conference hall full of bored bureaucrats and nodding diplomats all listening to what sounds more like an election manifesto than a policy document? Unfortunately, the Nepali media is responsible for encouraging this farce by analysing the pie charts to death. Since private companies don't take the budget seriously, can we expect the government to do so?

The system of budgetary control, like the National Planning Commission (NPC), needs to be revisited. We have economy and business-related ministries dispersed over several portfolios, but then the Finance Ministry also has solo access to the budget. Money from agreements with donors or from unilateral donor assistance, of course, never adds up in the budget. Dovetailing all that into yet another five-year plan is a nightmare and does not happen.

The time has come to take an out-of-the-box approach. Everyone should help the government get away from this outdated, embarrassing ritual. There should be a document of policy pronouncement that states the broader economic policies along with the plan for the year ahead, and a more serious, technical approach to accounting. There are many ways to make this process more meaningful, but the current system of budgetary control defeats the very definition that books have laid down.


LATEST ISSUE
638
(11 JAN 2013 - 17 JAN 2013)


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