Addressing the root causes of poverty and conflict, among others, should be the top priority of the government, if it wants to find sustainable peace and progress in the country
By Shiv Raj Bhatt
The budget, an action plan related to expenditure and revenue of the government, for a year, is a powerful policy instrument in the hands of any government that affects the lives of citizens. Because of its immediate and long-term impacts, it gets hot debate among the people each year, especially few days prior and after the budget declaration.
This years’ (pre) budget discussion are now undergoing. As every year, all segments of the society, including business people, civil servants, development workers, journalists, house wives, students, unemployed people, senior citizens, physically challenged personalities and others are expecting something from the upcoming budget. Such expectations of the people are not very wrong and unjust, especially in a country like our, where the role of the government is very crucial not only in the development of physical and social infrastructure, but also in skill development, job creation, and in providing basic necessities and services to the public too.
It is better to keep our expectations low, but, not that low, which make the finance minister lazy and less enthusiastic. This way, we could help the minister to work hard, achieve the best possible and win our hearts.
However, the expectations of various groups of people naturally vary. Business peoples’ expectation may certainly not match with that of the house-wives. On the other hand, the government has very limited resources to fulfill those expectations of the people. In such a situation of very high and varied expectations and limited resources at hand, it is very hard for a government to meet fully the expectations of all. Setting priorities and meeting peoples’ expectation as much as possible is the only way out for the government. But, setting/fixing priorities, targets, strategies and actions to achieve the goal(s) itself is very challenging.
While formulating the budget, the government may use many indicators, developed by the economists, as a tool to assess the quality of the budget. The indicators ranges from revenue side (for example, why and whom to tax, tax to what extent, methods of tax collection etc.), expenditure side (for example, in what type of activities and how much the government should spend— defense or education, primary or higher education, scholarships for students or allowances of royal family and ministers, targeted pro-poor or not etc.). What type of budget is good (deficit or surplus)? In a country like Nepal where deficit budget are unavoidable, the question of financing fiscal gap is also very important. How the fiscal gap can be financed– through loan or aid? If loan, internal or external and if aid, bi lateral or multilateral. Mainstreaming of marginalized/disadvantaged people and targeted programs needed to do so are some additional issues a good budget should have.
Nepal is currently facing some additional challenges too, especially conflict recovery and political transformation of the nation. Maintaining social harmony is a major challenge facing the government. Therefore, apart from meeting above criteria, there is a need to meet additional criteria too, for the upcoming budget to be a good budget. In addition to following the traditional principle of equity and efficiency, the upcoming budget will have to take into account the new indicators (related to peace building and political transformation) too.
In this situation, responsibilities of the finance minister and all those who are engaged in budget formulation has increased and become more complicated. But these challenges and additional responsibilities also have created golden opportunities for them to show their skill, meet people’s expectations and move the nation in right direction, win the hearts of the people, while governing the state.
While formulating the budget, the government should also not to forget the root causes (poverty, inequalities and discriminations, among others) of Nepal’s now visible and dominant problems (conflict and political transformation). Therefore, addressing the root causes should and must be the top priority of the government, not only in the words, as always, but in actions too, if it wants to find sustainable peace and progress in the country.
Last but not the least, we all know that achieving all the goals and fulfilling all the expectations of people in a single budget is not an easy task. So it is better to keep our expectations low, but, not that low, which make the finance minister lazy and less enthusiastic. This way, we could help the minister to work hard, achieve the best possible and win our hearts.
(Bhatt is working as Consultant Economist at the South Asia Watch on Trade, Economics and Environment (SAWTEE)—a Kathmandu-based think tank and can be reached at [email protected])
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