A total of 27 local governments failed to present their budgets for the upcoming fiscal year 2026-27 within the statutory deadline of June 24.

Out of 753 local levels, two sub-metropolitan cities, 10 municipalities and 15 rural municipalities were unable to present their budgets in municipal and village assemblies by Wednesday, the deadline for budget submission.

According to the Ministry of Land Management, Cooperatives, Federal Affairs and General Administration, 726 local governments had presented their budgets for the upcoming fiscal year by the deadline.

The ministry said that in Koshi Province, five local units missed the deadline, followed by 11 in Madhesh, two in Bagmati, one in Gandaki, four in Lumbini, one in Karnali and three in Sudurpaschim.

Ministry spokesperson Ekdev Adhikari said tensions between local government heads and chief administrative officers, disagreements among elected representatives over policy, programmes and budget allocation, and federal intervention over budget spending had led to delays in budget presentation.

He said disputes over budget allocation among elected representatives and efforts by the ministry to control misuse of fiscal transfer funds had caused delays, preventing budgets from being presented on time.

Rajendra Pyakurel, chief executive officer of the National Association of Rural Municipalities in Nepal (NARMIN), stated that inadequate preparation, illness of chairpersons or their family members, and failure to reach consensus on budget formulation, among other reasons, had contributed to the delay.

The sub-metropolitan cities of Dharan and Janakpurdhama are among those that failed to present their budgets by the deadline.

Other municipalities that missed the deadline include Sukhipur, Jaleshwar, Harivan, Garuda, Katahariya, Phatuwa Bijayapur, Melamchi, Baglung, Tikapur and Bideha.

Rural municipalities that failed to present their budgets include Athrai, Jahada, Chhathar Jorpati, Pipara, Kamala, Dhobini, Chhipaharmai, Raksirang, Kotahimai, Suddhodhan, Mayadevi, Kalimati, Mudkechula, Jayagadh and Joshipur.

The Local Government Operation Act, 2017 and the Intergovernmental Fiscal Management Act, 2017 require all local governments to present their budgets for the upcoming fiscal year in their village or municipal assemblies by June 24.

The National Natural Resources and Fiscal Commission Act stipulates that local units are awarded five points under performance indicators based on whether they present the revenue and expenditure estimates for the upcoming fiscal year to their respective village or municipal assemblies by the deadline.

An additional five points are allocated based on whether local assemblies approve the budget by mid-July.

The commission uses a total of 17 indicators to award a performance score out of 100.

The federal government has said that the 27 local governments that failed to present their budgets on time will lose five points in conditional grants under the equalisation grant heading for the next fiscal year.

Spokesperson Adhikari said fewer local governments missed the deadline this year compared to last year.

“Local governments that fail to present budgets on time see a reduction in performance-based fiscal equalisation grants,” he said