Local Level Representatives Issue Ultimatum to Ministry of Finance Over Grant Cut

Representatives of local levels nationwide have issued a stern ultimatum to the Ministry of Finance (MoF), demanding rectification of its decision to slash grants to sub-national governments. The ultimatum, set at seven days, underscores the urgency felt by local units grappling with the implications of a 25 percent reduction in the fiscal equalization grant.

Expressing their discontent, the local units insist that the MoF revises its decision swiftly, especially with expectations high for the final installments of the fiscal year 2023/24. The MoF, however, justifies its stance by citing low revenue collection this year as the rationale behind the grant reduction.

In response to the looming financial strain, the National Association of Rural Municipalities and the Municipal Association of Nepal have issued a joint warning, threatening to shutter all 753 local units and stage a protest at Singha Durbar if their demands remain unaddressed within the stipulated seven-day timeframe.

The gravity of the situation was palpable on Sunday as representatives from both associations staged a sit-in in front of the MoF headquarters, signaling their resolve to push for a resolution.

The standoff between local representatives and the MoF underscores broader challenges in fiscal management and resource allocation, highlighting the need for constructive dialogue and swift action to address the concerns of local governance bodies.