Increasing arrears concerning in view of economic discipline: Speaker Ghimire

Kathmandu: The Public Account Committee, the House of Representatives has said that a growing size of arrears is not only about the absence of proper utilization  of the State coffers but also serves as a way of decreasing civic trust towards public entities.

During a national workshop on arrears organised by the Committee here today, it has been concluded that controlling expenditures that are carried out in violation of the law is one of the significant aspect of national economy. “The rising arrears pose a significant question to nation’s economic good governance,” it was said, underlining the essentiality of proper management of public resources.

It may be noted that the 62nd annual report of the Auditor of General has calculated the arrears until fiscal year 208-81 BS at over Rs 733 billion. The updated figure of arrears is more by 9.34 percent compared to the previous year.

During the event, Committee President Rhishikesh Pokhrel said the existing size of arrears which is around 12 percent in ratio of the Gross Domestic Product is concerning.  This is not just a number, instead it is significantly related with good governance and fiscal discipline, he said, underling the need of policy reforms and the effective implementation of law with the use of information technology and coordinated efforts among the bodies concerned to address the situation.

Addressing the event, Speaker Devraj Ghimire stressed the need of a systematic way of expenditures with a systematic and transparent record keeping system. ”

Accounting system of State’s income and expenditures carries a significant meaning during the operation of the State, he said, underlining the need of harmony and coordinated efforts among the three-tier people’s representatives to ensure that every record keeping of the State’s income and expenditure is well-managed, transparent and effective.

Taking reference of the 62nd annual report of the OAG, the Speaker said a rise in arrears’ figure is concerning in view of economic good governance.

Deputy Speaker Indira Rana stressed the need of integrity, honesty and transparency on part of all bodies concerned in the operation of the State coffers. She also echoed the need of economic discipline in all aspects of the operation of the State resources including its record keeping and auditing.

Auditor General Toyam Raya stated that while arrears suggest a lack of financial discipline not all arrears necessarily involve unlawful expenditure.

In the last fiscal year, the Office of the Auditor General (OAG) audited 5,700 offices and identified arrears amounting to Rs 733 billion. These arrears include amounts to be recovered, regularized, or supported with proper documentation, as well as issues related to unverified procurements, unassigned responsibilities, pending reimbursements, and outstanding advances.

Raya added that auditors are instructed to maintain financial discipline and, wherever possible, to stay in government accommodations during field assignments. He further clarified that it is a misconception to assume that every instance of arrears implies irregularities or corruption.

As per Article 294 of the Constitution, the OAG, being a constitutional body, is required to submit its annual report to the President. The President, in turn, presents the report to the Federal Legislature through the Prime Minister. The report is then reviewed and discussed by the Public Accounts Committee (PAC).

PAC Secretary Eakram Giri stated that the Committee is actively working to promote transparency and accountability in public spending. He added that the Committee’s focus is to identify the underlying nature of arrears and recommend effective measures for their control.