Deliberations on the finance committee’s report on the annual budget 2017-18 continued yesterday in the National Assembly with a focus on the sector-wise budget allocation.

According to the budget report, the government has allocated the “economic and public services” sector about 34 percent of the total budget of Nu 60.77 billion (B).  About Nu 20.7B has been allocated for the sector.

The energy sector receives only about one percent of the total budget. During the financial year, the energy sector aims to accelerate hydropower development and enhance energy security, diversify and promote alternate renewable energy.

To achieve these objectives Nu 455 million (M) has been allocated.

Presenting the committee’s report on May 23, Wamrong MP Karma Tenzin said the budget is adequate to complete all the on-going activities within the 11th Plan period that ends in June next year.

“Allocations have been made keeping in mind the country’s economic situation and the developmental needs of the country,” he said.

Opposition Leader (Dr) Pema Gyamtsho said that it was important to keep in mind the national goal – economic self-reliance among other objectives – while allocating budgets for various sectors. He said that if these aspects were not considered, the purpose of tabling the budget would be lost.

According to the report, there is a need for better coordination between agencies like the Gross National Happiness Commission (GNHC), the departments of Public Accounts and National Budget and other budgetary agencies on the budget allocation process.

The report states that with donor countries phasing out their support, it is important for Bhutan to be prepared to increase its domestic revenue to fund its development activities.

MP Karma Tenzin said the government should opt for pre-financing for important activities that are funded by donor countries. The report also states that the government should altogether strengthen the public expenditure management system.

The committee recommended that the government should not treat the savings acquired from projects that are completed as “underutilised”. The committee found that savings from a project that is completed are reflected as “underutilised”.

The committee also reported that there were differences in the approved budget estimates and contract amounts because contractors quote below the approved budget.

It was also reported that lack of bidders and international consultants led to delay in implementation of activities. There are also cases where advances are not reflected in expenditure details, the committee found.

According to the committee, implementation of works in dzongkhags is delayed due to non-availability of “relevant people”. “The stringent procurement rules discourage suppliers to take part in the tendering process in some dzongkhags.”

The delay in funds causes delay in implementation of projects. The process involved in obtaining the required clearances is “too lengthy”.

The committee informed the House that budgetary support for constitutional offices like the Anti-Corruption Commission, the Royal Audit Authority of Bhutan, the Royal Civil Service Commission has declined by 7.9 percent to 17.2 percent from the previous financial year.

“Given the significant mandates of the constitutional offices, there is a need to allocate sufficient budget to enable them to discharge responsibilities,” said Karma Tenzin.

According to the committee, there is no financial flexibility for constitutional and autonomous agencies.

Another issue the committee highlighted was the failure of donor countries to release the money on time.

MB Subba