Medium Term Expenditure Framework-V FY 2006/07 – 2008/09 ESP (Three Years Rolling Programme – Budget)

Project Description

Nepal’s planning and budgetary process has been the over-optimism of five-year plans and annual budgets in terms of both resource availability and implementation capacity. Moreover, planned goals, objectives, outputs and resource allocations are not adequately integrated into annual budgeting. Lack of effective prioritization, proper costing, and outputs and expenditures estimation of programs/projects in line with planned goals and objectives have also led to wide gaps in plan targets and actual achievements. In many cases, the expected outputs of each project/program are stated in general terms rather than in quantity with the level of quality anticipated. The MTEF therefore aims to correct these problems by: (i) linking annual programs and budgets with periodic plan; (ii) prioritizing programs along with costing, outputs and expenditures in accordance with the periodic plan’s national and sectoral goals and objectives; (iii) adjusting the annual expenditure programs of the Tenth Plan to a level consistent with resource availability; (iv) maintaining macro-economic stability; and (v) providing funding guarantee to top priority programs/projects. In essence, the MTEF is expected to effectively bridge the gap between the Tenth Plan and the annual programs and budgets while, at the same time setting resource forecasts and physical targets for the budget itself at a realistic level.
The main objectives are to assist National Planning Commission Secretariat and line ministries in the preparation of MTEF -V (FY 2006/07-2008/09) including capacity building of NPCS and the Macro-economic Management Division in particular along with the line ministries, which is responsible for the preparation of MTEF on yearly basis.

Assignment Description

The MTEF -V was completed along with the budget formulation process for FY 2006/07. • Worked under the directives of The high-level steering committee chaired by the NPC member for the economic sector • Facilitated/assisted the working teams of the respective ministries to prepare the MTEF (three years rolling plan) along with the programs for the next fiscal year. • Assisted in arriving development budget ceilings, which were taken as the basis for the formulation of MTEF-V– macro & sectoral level. • Prepared a guidelines/directives and provided to line ministries to streamline programs, dropping unnecessary ones, and not to add anymore unless agreed upon with the donors. • Interactive meetings were organized with different ministries to finalize project within the budget ceiling. • Weightage has been developed to each criteria adopted to assess the priority ranking score of the projects. • Sectoral papers have been prepared with the vision, mission, goal, major objectives, relationship with the Tenth Plan, Sectoral Business Plan, three-year outputs and outcomes of MTEF year, and the projection of remaining one years of the Tenth Plan and first two years of Eleventh Plan. Assessment of the sector has been carried out to understand the implications for development partners. • Assessment of prioritization of previous projects and finalization. • Identification of new programs and projects with prioritization. • The effective implementation, monitoring and evaluation system has been proposed for projects/programs and sector levels. • Linking program/projects of all the sectors to national and sectoral objectives and pro-poor & gender coding following the defined criteria. • Various interaction meetings organized/conducted to finalize MTEF documents. • Deliverables/ reports • MTEF-V – Macro Level/ National Level – main report with Appendices – Directives, Form and Formats; Summary of Estimated Expenditures of different sector • Sectoral MTEF Papers • Sectoral – Estimated Budget/ Expenditure for three years