Karnali Province Faces Growing Financial Irregularities and Unresolved Audit Arrears

Surkhet. The Public Accounts Committee under the Karnali Provincial Assembly has been actively working for the past two years to control the provincial government's audit arrears (beruju). As arrears continue to rise annually, the committee is conducting extensive discussions to minimize them.

Committee Chairman Bindaman Bista stated that the committee is currently discussing the arrears pointed out by the Office of the Auditor General's seventh report across various ministries. 'We have created a schedule for discussions on the seventh annual report of the Auditor General with the ministries and agencies of Karnali Province,' he said. 'The discussions on ministry arrears, which began on Sunday, will continue until Baisakh 13.'

He mentioned that discussions on the arrears of other subordinate bodies will follow. On Monday, the arrears of the Ministry of Industry, Tourism, Forest, and Environment were discussed. 'We are also calling the relevant ministers and secretaries to the discussions,' he added.

According to the seventh report, in the fiscal year 080/081 alone, arrears of 459.482 million rupees have been identified. In that year, the Ministry of Physical Infrastructure and Urban Development showed the highest arrears of 182.12 million rupees.

Similarly, the Ministry of Social Development has arrears of 124.005 million rupees, and the Ministry of Water Resources and Energy Development has 54.658 million rupees.

The former Ministry of Internal Affairs and Law had 41.096 million rupees in arrears, and the Ministry of Industry, Tourism, Forest, and Environment had 26.617 million rupees. The Ministry of Law has now been merged into the Office of the Chief Minister.

Likewise, the Ministry of Land Management, Agriculture, and Cooperatives has 15.607 million rupees, the Ministry of Economic Affairs and Planning has 13.149 million rupees, and the Office of the Chief Minister and Council of Ministers has only 2.23 million rupees in arrears.

• Karnali, a province of arrears: How much for which agency?

Due to government apathy, financial indiscipline has increased, leading to a pile-up of arrears. From the fiscal year 074/075 up to the seventh report of the Auditor General, the total arrears of the Karnali government have reached 4.120584 billion rupees.

The arrears have increased further as the ministries and agencies responsible for maintaining financial discipline remain defiant. Of the total arrears to date, the Ministry of Physical Infrastructure and Urban Development alone accounts for nearly 2 billion rupees.

(Table of updated arrears of Karnali Province ministries/agencies to date)

• Defiant government - ignores committee directives

Following repeated directives from the Accounts Committee, 1.379 billion rupees were recovered last year, which is somewhat routine.

Along with that, the government had 3.948355 billion rupees in arrears. Subsequently, after 296.844 million rupees were cleared through audit settlement, an additional 9.692 million rupees in arrears were added.

While the net remaining arrears from previous years stood at 3.661102 billion rupees, with the addition of 459.482 million rupees in the seventh report (080/081), the total arrears of the Karnali government stand at 4.120584 billion rupees.

The Auditor General defines arrears as amounts spent without following legal procedures, failing to maintain required accounts, or conducting financial transactions in an irregular or inappropriate manner.

If the government and its agencies had paid attention to the activity and directives of the Accounts Committee, the 'graph' of arrears would have been much lower. However, Committee Chairman Bista says that no matter how many directives the committee issues, the government continues to ignore them.

According to him, the committee, which held 27 meetings in the last year, issued 203 directives focusing on the sixth annual report of the Auditor General. The committee's conclusion is that the government has not even followed the directives from previous reports.

'If those directives had been followed, there would not have been an additional 460 million rupees in arrears in the seventh report of the Auditor General,' says an employee working in the Accounts Committee. 'Also, the past arrears would have been much lower; the government itself is defiant, what is the point of just giving directives?'

Even with repeated warnings from the committee, the government is not paying attention. Some ministries have been issued directives up to 17 times. Every ministry and agency has been issued repeat directives between 4 and 18 times.

Therefore, the committee is now also working on discussing the implementation of previous reports and issued directives, said Netra Karki, the committee's member secretary.

Chief Minister Yamlal Kandel is repeatedly directing the relevant agencies to pay attention to controlling arrears. He has introduced and implemented procedures related to project banks and project selection to maintain financial discipline. It is expected that this will reduce financial indiscipline in the coming days.

The current remaining arrears date back to the inception of the province. Previously, neither the government nor the committee had paid attention.

Accounts Committee Chairman Bindaman Bista says the government has not prioritized the settlement of arrears and financial governance. The committee has given clear directives to work by creating necessary acts, rules, and procedures, to regularize irregularities, and to recover amounts that need to be collected.

According to him, the government does not seem to have taken these directives seriously. He says, 'Now the committee will increase its activity to force the government to implement the directives by constantly prodding them.'