The Lumbini provincial government has decided to cut 20 percent of the budget allocated under all expenditure headings in the current fiscal year as part of its cost cutting measures.

A meeting of the council of ministers, chaired by Chief Minister Chet Narayan Acharya, on Saturday instructed all provincial bodies to implement austerity and execute plans and programmes within 80 percent of the allocated budget ceiling.

The Cabinet meeting held at the office of the chief minister in Deukhuri, Dang decided to introduce additional budget management provisions in line with the guidance of the federal government and directives of the ministry of economic affairs and planning.

Dinesh Panthi, provincial government spokesperson and the minister for agriculture, land management and cooperatives, informed that the Cabinet also directed to implement only one project or activity and suspend the rest in the case of duplication of the projects. Likewise, 20 percent of the allocated amount under various headings will be frozen.

“The Cabinet decided to freeze 20 percent of the capital budget, excluding projects operated under complementary grants, multi-year projects, and those related to regular road maintenance,” he said.

Similarly, under recurrent expenditure, 20 percent of the budget allocated for monitoring and evaluation, programmes, office operations, miscellaneous activities, skill development, awareness campaigns, training and workshops, and consultancy services will be withheld.

“The decision to freeze 20 percent of all recurrent expenditure headings has been made as an immediate measure,” Panthi said. “Further decisions will be taken after analysing the province’s financial position.”

The meeting also decided to form a three-member committee led by the provincial chief secretary to study and recommend policy, legal, and administrative reforms to promote good governance in the province, incorporating the sentiments of the youth.

After becoming finance minister following the Gen Z movement last month, Minister Rameshore Khanal directed all government agencies to remove all the projects that overlap with others, are included in the annual budget without proper study or due to political pressure.