Outstanding arrears reach Rs. 755 billion

Kathmandu, May 16: Cumulated arrears in the country have reached Rs. 755 billion, concluded the Office of the Auditor General (OAG) report for the Fiscal Year 2024/25 unveiled on Friday. The arrears witnessed 2.99 per cent increase from the previous year.

Till FY 2023/24, arrears stood at Rs. 667.08 billion. Rs. 88.09 billion was added last year. 

The OAG conducted audits worth Rs. 9.484 trillion in the last fiscal year, covering federal, provincial and local levels, organised institutions, and other bodies and committees designated under federal law.

The OAG conducted the audits of 3,050 federal ministries and agencies amounting to Rs. 2.917 trillion, 1,124 provincial ministries and agencies amounting to Rs. 320.30 billion, and 721 local levels amounting to Rs. 1.109 trillion. 

Similarly, the audit of 54 fiscal years for 44 organised entities other than ministries and line agencies, involving an amount of Rs. 4.688 trillion, has been completed. In addition to this, for 46 fiscal years of 40 entities where consultation was provided, the designated auditors have completed audits amounting to Rs 1.832 trillion. The settlement of arrears is handled by the boards of the respective organised entities themselves. 

However, the Gen Z movement impacted the audit work. Audits amounting to Rs. 147.90 billion could not be carried out as 179 offices and agencies failed to submit their accounts and related records as they were destroyed during the movement. 

Of Rs. 88.09 billion arrears added in FY 2024/25, Rs. 53.48 billion is from the federal government offices. Rs. 5.22 billion from provincial government offices and Rs. 19.04 billion from local governments. Federal and provincial governments' committees and other offices have generated Rs. 10.32 billion arrears. 

Through the settlement and clearance of previous irregularities and issues identified this year, only Rs. 14.63 billion has been recovered.

Madhes records highest arrears 

In provinces, Madhes recorded the highest percentage of audit irregularities with an irregularity rate of 3.77 per cent last year. Audits of 150 offices in the province covering accounts worth Rs. 49.69 billion were conducted, of which irregularities amounting to Rs. 1.87 billion were identified. 

Likewise, Bagmati recorded the lowest irregularity rate at 0.83 per cent. Audits of 209 offices in Bagmati covering Rs. 83.15 billion found arrears worth Rs. 693.7 million.

In Koshi, arrears amounted to Rs. 555.3 million – 1.12 per cent of the total audited amount Rs. 52.38 billion. 

Arrears in Gandaki amounted to Rs. 540.3 million, Lumbini Rs. 633.2 million. Karnali Rs. 700 million and Sudurpaschim Rs. 555.9 million. 

70% arrears in Finance Ministry 

The OAG Report found that the highest amount of arrears (70.36 per cent of the total Rs. 53.48 billion) is generated at the Ministry of Finance, among the federal ministries. 

An audit of Rs. 2.244 trillion under the MoF found a total of Rs. 37.63 billion in arrears, including Rs. 20.95 billion to be recovered, Rs. 16.63 billion requiring regularisation, and Rs. 45.7 million in outstanding advances.

The Ministry of Physical Infrastructure and Transport followed the MoF with 13.28 per cent share in the total arrears. An audit of Rs. 123.93 billion under the Ministry revealed total irregularities of Rs 7.10 billion, including Rs. 2.20 billion to be recovered, Rs. 4.40 billion requiring regularisation, and Rs. 488.1 million in outstanding advances. 

Likewise, the Ministry of Land Management, Cooperatives and Poverty Alleviation recorded 2.87 per cent of the total arrears, with total unsettled amounts of Rs. 1.53 billion. The Ministry of Forests and Environment reported irregularities of 2.52 per cent, equivalent to Rs. 1.34 billion.

The Ministry of Communications and Information Technology has arrears amounting to 2.18 per cent - Rs. 1.16 billion.

Similarly, arrears at the Ministry of Urban Development stood at Rs. 805.1 million, the Ministry of Foreign Affairs Rs. 743.4 million, the Ministry of Energy, Water Resources and Irrigation Rs. 652.6 million, the Ministry of Home Affairs Rs. 577.2 million, and the Ministry of Health and Population Rs. 524.3 million.