Development budget spending slackened by NPC

Wednesday, 09 August 2017 02:51 Written by  Heart of Asia Read 183 times

While the third quarter of the current fiscal year is nearing its end, the independent budgetary institutions have spent only 24 percent of their development budgets on average. 


Although the underspending of development budget is a major issue since the last several years, economic pundits described the National Procurement Commission (NPC) as one the major factors for it during the President Ghani-led National Unity Government (NUG). 

Muhebullah Sharif, an economic expert, said if the issue of transparency in National Procurement Commission (NPC) was put aside, and special attention was to be paid to time, the NPC lacked the capacity to assess and approve thousands of projects in a week. 

“Chaired by the president, the NPC convenes only once a week, and if it approves even ten projects every week, it is still less so that is why, the level of development budget has dropped, with hundreds of projects pending approval,” Sharif revealed to The Heart of Asia. 

He said unemployment, poverty and stagnant economy were the fallouts of development budget underspending. 

Nonetheless, Akbar Stanikzai, a member of the Financial Budgetary Affairs Committee of Wolesi Jirga, said there were three major reasons for the low spending of development budget, for which he blamed the government. 

The National Procurement Commission, the continued work of caretakers, and disagreements between the president and his chief executive officer over state institutions were the factors that have slowed down the use of development budget, Stanikzai explained, adding that "the NPC has taken control of all projects of the country, and it cannot review and approve them on time, contributing to the underspending of development budget”.

According to him, another major reason for budget underspending is the presidential decree issued at the beginning of the current fiscal year, which handed over the control of construction projects of all ministries to the Ministry of Urban Development Affairs (MUDA). 

He said a lion’s share of the development budget of each institution is spent on its construction projects; however, the president handed over the control of those projects MUDA, a move that was greeted with opposition by lawmakers, and whose fate was presently unclear. 

He believed the decree had either halted or hindered the work of many construction projects because not only MUDH could not handle all the construction projects of the country, but the decree was also illegal. 

Meanwhile, the Ministry of Finance (MoF) says the development budget spending target for the current year is 80 percent; however, 24 percent of budget has been spent on average so far by 57 independent budgetary institutions. 

Ajmal Abdul Rahimzai, the MoF spokesman, told The Heart of Asia the MoF has provided all facilities related to budget spending, and even the execution of budget allocation now took a few hours, stressing that government institutions which have underspent their budget should provide explanations. 

According to him, most institutions may not hit the development budget spending target set by the Ministry of Finance.