Prudent fiscal management appears to have taken a back seat in Nepal’s federal budget for fiscal year 2025/26. In a striking case of public fund misuse, the ruling UML–Nepali Congress coalition has allocated nearly Rs 1 billion (Rs 957.7 million) from the state treasury for the construction of buildings associated with their affiliated organizations. The Ministry of Urban Development (MoUD) has launched dozens of such projects—many named after prominent leaders from the two ruling parties, raising serious concerns about political favoritism and budgetary accountability.

But the controversy does not stop there. In direct violation of a cabinet decision and Finance Minister Bishnu Paudel’s public assurance, the urban development ministry has included 3,983 individual projects and programs with allocations ranging from Rs 1,000 to Rs 9.9 million. These small projects account for 59% of the ministry’s 6,755 projects—raising alarms about the government’s commitment to fiscal discipline. Notably, 20 of these projects have been allocated just Rs 1,000 each, despite directives stating that projects under Rs 30 million should be handled by provincial or local governments—not the federal level.

Minister Singh and Political Memorials

Deputy Prime Minister and Urban Development Minister Prakash Man Singh appears at the heart of this budgetary maneuvering. A significant portion of the MoUD budget has been funneled into projects commemorating the minister’s father, the late NC leader Ganeshman Singh, and his mother, Mangala Devi Singh, alongside other party icons including BP Koirala, Krishna Prasad Bhattarai, Sushil Koirala and Madan Bhandari.

The National Planning Commission (NPC) had introduced the National Project Bank Standards 2024 to prevent such fragmented, small-scale projects from entering the federal budget. The urban development ministry was the biggest violator of these standards, inserting projects to appease ruling party ministers, lawmakers and leaders. While the NPC barred small projects from being listed in the Project Bank, they appear to have been added later through the Finance Ministry’s Line Ministry Budget Information System (LMBIS). The ministry has defended the move, arguing that the smaller allocations were for projects initiated in previous years.

Ganeshman and Mangala Singh Projects Dominate

The MoUD has earmarked Rs 696.2 million for 49 projects named after Ganeshman Singh and Mangala Devi Singh. Two prominent projects—one building in Kathmandu-13, reportedly intended for the Nepali Congress youth wing Nepal Tarun Dal, and another in Pokhara—have each been allocated Rs 30 million. Another Rs 70 million has been set aside for a study institute named after Ganeshman Singh in Satakshi, Jhapa. Additionally, Rs 40 million has been allocated for a memorial park in Jaharsingh Pauwa, his birthplace. Numerous smaller projects in Surkhet, Sindhupalchowk, Morang, Bara and Kailali—ranging from Rs 2 million to Rs 30 million—have also been included under the pretext of commemorating the late leader.

Similarly, eight projects costing Rs 127.6 million have been named after Mangala Devi Singh. A Rs 30 million foundation building in Kathmandu and a Rs 32 million community hall in Nagarjun Municipality top the list. Necessary budgets have been allocated for similar projects in Gulmi, Kailali and Kavre—districts tied symbolically or politically to her legacy.

The controversy intensified when Nepal Tarun Dal confirmed that the Rs 30 million allocated under the name “Ganeshman Singh Memorial Building in Kathmandu-13” would be used for its new party headquarters. Tarun Dal President Bidwan Gurung publicly thanked Minister Singh and NC President Sher Bahadur Deuba for the allocation.

Budget Politicization Goes Beyond One Family

The politicization of federal funds is not confined to the Nepali Congress. Several UML and Maoist leaders have also been posthumously honored through budget allocations.

Projects named after former UML general secretary Madan Bhandari have received Rs 120 million, covering Udayapur, Kathmandu, Bardiya and Kalaiya. Similarly, Rs 74.5 million has been earmarked for initiatives in honor of BP Koirala and Krishna Prasad Bhattarai. A park in Ramechhap named after Pushpalal Shrestha, a founding figure of Nepal’s communist movement, has received Rs 7 million. In Humla, Rs 30 million has been allocated for a project commemorating Maoist leader Post Bahadur Bogati.

In some cases, multiple party leaders have been bundled into single initiatives. One memorial building in Sunsari, for example, combines the names of Mangala Devi Singh, Nona Koirala, Sushila Koirala and Shailaja Acharya—and has been awarded a total of Rs 135 million.

Red Flags from the Ruling Coalition, Opposition

Former Finance Minister Barshaman Pun questioned the MoUD’s budget increase from Rs 91 billion to Rs 118 billion, calling the Rs 27 billion spike “unnatural” and “suspicious”. “How did allocations as low as Rs 100,000 make it into the budget when the finance minister said nothing under Rs 30 million would be approved?” he asked in Parliament. “The Red Book reveals a pattern of scattered micro-allocations.”

UML leader Mahesh Basnet, a member of the ruling coalition, also voiced concern, particularly about the Rs 30 million given to Nepal Tarun Dal. “Taxpayer money should not be spent for party gain. This is dangerous for governance and public trust,” he wrote on Facebook.

Minister Singh Responds

Minister Singh defended the allocations, insisting that all projects followed due process. “These are not party buildings; they are memorial structures with public utility,” he told journalists on June 9, amid mounting criticism.

However, many see the FY 2025/26 budget as a troubling example of how public funds are being diverted toward partisan interests. What were once honorable gestures to commemorate national figures now risk becoming tools for political entrenchment—undermining transparency, ethics, and fiscal integrity in Nepal’s budgetary process.

(This article was originally publihsed in  July 2025 issue  of New Business Age Magazine.)