103 Local Bodies Fail to Meet Budget Deadline, Impacting Fiscal Year Operations

As of September, 103 out of Nepal’s 753 local bodies have yet to present their budgets for the fiscal year 2024/25, missing the June 25 deadline set by the Intergovernmental Fiscal Arrangement Act 2017. This deadline requires federal budgets to be submitted by May 28, provincial budgets by June 15, and local budgets by June 25.

The Ministry of Federal Affairs and General Administration reports that no municipality across the seven provinces has fully presented its budget. In Madhesh Province, 47 out of 136 municipalities are still pending. Koshi Province has 123 out of 137, Bagmati Province has 103 out of 119, Gandaki Province has 82 out of 85, Lumbini Province has 95 out of 109, Karnali Province has 74 out of 79, and Sudurpashchim Province has 84 out of 88 municipalities yet to finalize their budgets.

Gandaki Province has the highest completion rate at 96.5%, while Madhesh Province is lagging at 65.4%. The delays have disrupted administrative functions and financial management, as municipalities struggle with operational and budgetary challenges.

The National Natural Resources and Fiscal Commission requires municipalities that fail to approve their budgets to submit a provisional one. However, many have not yet complied with this requirement, leading to interruptions in their annual programs and day-to-day operations.