Nepal mulls over dissolving fund established to combat poverty

File: A family living in poverty

Kathmandu, November 30

For last three months, top finance officials of the Nepal government are discussing whether to dissolve the Poverty Alleviation Fund, a body established to carry out programmes to combat poverty in the country.

The officials are under a pressure to take a concrete decision now as the World Bank has decided that it will not provide grants to the PAF anymore.

Recently, the officials are discussing four options about dissolving the inefficient body. The options include turning it into a flagship programme with a national importance, a nonprofit public company or a high-level institution and its dissolution.

A meeting attended by officials of the Ministry of Finance and the National Planning Commission on Wednesday has concluded that the PAF should be changed into a flagship programme, says the Commission’s Joint-Secretary Tulasi Ram Gautam.

Gautam, however, adds that the final decision will be taken by a meeting chaired by the Prime Minister.

But, such a meeting is unlikely before the formation of new government as the country will hold the final phase of parliamentary elections next week. Therefore, it is likely that the final decision will be made after around four months when the government begins preparations for the next annual budget.

Earlier, the government had proposed that the World Bank continue support to the PAF till 2030 as it will play a significant role in Nepal’s journey to the status of a developing country as well as achievement of sustainable development goals. The Bank, however, said it could not continue the support if the PAF would run in the NGO model.

The Bank, however, had maintained that it could issue a soft loan at 0.75 per cent interest rate.

The PAF was established during the armed conflict period under the Office of the Prime Minister and Council of Ministers. The government has already invested more than Rs 22 billion in the PAF.


Published on November 30th, Thursday, 2017 2:55 PM

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