Following the presentation of the federal budget in the federal parliament about a fortnight back, the state governments presented their annual budget for the fiscal year 2020/2021 last week. The budget size of the state for this year has remained almost the same as in the previous year though some state governments have slashed the amount in nominal terms considering the strains and squeeze in revenue generation due to COVID-19 pandemic. Of the seven state governments, four have followed suit of the federal government to slash the size of the budget nominally whereas the others have slightly increased the budget figures too. Bagmati state has presented inflated sized budget exceeding more than five billion rupees allocating around 51 per cent for recurring and above 48 per cent for capital expenses. The state 2 government criticised for having presented ambitious, distribution-oriented and poorly targeted budget estimates during the previous years has cut the size of the budget this year. It has presented a budget of less than Rs. 4 billion but has given continuity to the constituency development fund to be spent under the discretion of both elected and nominated state assembly members.
Relief support Other state governments except state 5 have allocated much criticised fund for lawmakers which is said to contradict with legislative role of the parliamentarians. At the federal level too, voices for scraping the fund allocation for parliamentarians was not given proper consideration, similar approach of the state government to allocate fund for the respective lawmakers does not appear to be guided by sensitivity and exigency of the current difficult situation. The appreciable part of the state budgetary framework has been that the sizeable allocation has been entrusted to fight COVID-I9 to meet the expenses for procurement of medical supplies and relief support to the people affected due to virus infections. However, at a time when the nation has faced resource crunch severely and weighing in ways and means in tackling challenges presented by the dwindling of national reserve to meet the core general state expenses, it does not befit to fiscal prudence to indulge in misplaced allocation of resources and appropriation to the underproductive, publicly decried subjects. As state has been an entirely new political and administrative structure, exposure to new learning has to be initiated in administering this intermediate layer in the current three tiered federal framework. It must be noted that three states are yet to be named through and their administrative capitals have to be agreed and decided. Several institutions are yet to be created, adequate staff and functionaries are yet to be recruited and deployed to make provincial administration more functional and feasible. Moreover, the state structures, as mentioned above, lack any past institutional precedents and functional experiences to draw from. This presents critical challenges in making state governments both institutionally and organisationally viable and operable as everything has to be constructed from the very inception. In fact, state structures and institutions do provide rational and sustenance to the federal organisation of the state. In essential term, state structures make it constitutively different from the unitary organisation of the state. However, an inadequacy in their institutional and organisational capacity and an absence of an efficient administrative apparatus to implement functions has rendered state administration unable to deliver results both in terms of development and governance outcomes. This has also critical implication in poor oversight of the financial bill and budgetary allocations which are, of course, linked to address development needs at the respective level. Moreover, several issues inducing contention and controversies between federal and state government have surfaced currently. The federal government has enacted laws allegedly infringing upon state legislative authority. Though new state structures are gradually assuming the concrete and substantive form, their successes in promoting values of federalisation, democratisation and delivery of effective governance will remain uncertain if their parliaments are not capacitated to exercise their legislative sovereignty entrusted by the constitution. State parliaments like the federal one need to carry out representative, deliberative and oversight functions which involve representing the needs and aspirations of their constituents in policy making. For this, they need to have built- in capacity for the purpose of their role internalisation. The state parliaments follow and operate their legislative functions and financial procedures through committees and sub-committees that should better focus in building cross-partisan trust and carry out audit and oversight functions effectively. The state committees should also be orientated to internalise their roles and they need to be provided support to enhance quality of their legislative function. The committees should be encouraged to build and enhance participatory process and mechanism to institute stakeholder's engagement in increasing public input into lawmaking process. Moreover, developing rapport and linkage with federal parliamentary committees with a view to advance and pursue interests and jurisdictions of the state is also important to ensure that the national parliament is aware of the state concerns and sensitivities. As utilisation of state development budget is also questioned time and again state parliament needs to be effective to hold the government to account.
Capacity building Furthermore, it is also important to build skills in enhancing state capacity in tracking federal legislations especially with a view to ascertaining their consistency and conformity with competencies allocated to the state in the constitution. Finally, since the rationale of the state structure is questioned from political quarters too because of its ineffectiveness in delivering results, time has come for state executive and parliament to prove their utility and relevance through an effective and sound implementation of budgetary provisions in the current federal framework in Nepal.
(Rijal, PhD, contributes regularly to TRN and writes on contemporary political, economic and governance issues. email@example.com)