Government Issues New Criteria for Multi-Year Project Source Consensus to Enhance Budget Discipline

Kathmandu. The government has issued the Criteria for Source Consensus of Multi-Year Projects, 2082, to maintain budget discipline and further streamline the implementation process of development projects. The Ministry of Finance has implemented the new regulation, superseding the previous Criteria, 2081.

The new criteria set a deadline for source consensus for multi-year projects. Under the new criteria, the National Planning Commission must evaluate the received project proposals and recommend suitable projects to the Ministry of Finance for consensus by Mangsir 15. Previously, this recommendation could be made until the end of Mangsir.

The ministry or agency implementing the project must submit the proposal to the Planning Commission by the end of Kartik. Following the Commission's recommendation, the Ministry of Finance is required to make a decision regarding source consensus and inform the concerned agency by Poush 15.

For multi-year source consensus, the total estimated cost must be at least more than NPR 500 million. However, in the case of government building construction or service procurement projects, source consensus can be sought if the cost exceeds NPR 200 million.

According to the new criteria, when seeking source consensus, a minimum of one-fourth (25 percent) of the project's total estimated cost must have been allocated. The Planning Commission, while recommending, can only recommend up to four times the initial allocation, although this limit will not apply to motorable bridges and suspension bridges.

The duration of the source consensus will be a maximum of three fiscal years. However, for National Pride Projects, consensus can be granted for the entire duration of the contract. The criteria stipulate that if the procurement process does not advance within the fiscal year for which source consensus was obtained, such consensus will automatically become inactive.

A special arrangement has been made for the fiscal year 2082/83. Accordingly, ministries can submit proposals to the Commission by the end of Poush, the Commission must recommend by Magh 15, and the Ministry of Finance must provide consensus by the end of Magh.

The responsibility for project implementation lies with the concerned ministry or agency, and its details must be updated in the National Project Bank and the Ministry-wise Budget Information System.

The Ministry of Finance believes that this new arrangement will discourage the tendency to award contracts hastily at the end of the fiscal year and strengthen the pre-preparation of projects.