Finance Division Issues Order on Delegation of Financial Authority

The Finance Division of the Ministry of Finance has issued a consolidated order on the delegation and re-delegation of financial powers to ministries/divisions, attached departments and subordinate offices, aiming to ensure greater discipline, accountability and efficiency in public financial management and procurement. According to the order, the government has repealed the earlier delegation orders issued on August 16, 2015, along with subsequent amendments, and replaced them with an updated framework reflecting recent administrative changes and legal reforms.

The Finance Division noted that delegation of financial powers was first introduced through operating budget-related orders in 1983 and 1985. Subsequently, broader financial powers were delegated in 1994, followed by revised orders in 2000 and 2004. The most recent comprehensive order before the current one was issued in 2015, covering both development and non-development expenditures.

Since then, significant changes have occurred in government operations, procurement practices and budget execution. Moreover, amendments to the Public Procurement Act, 2006 and the formulation of the Public Procurement Rules, 2025 have made it necessary to further update and harmonise the delegation of financial powers.

The new order incorporates institutional levels in line with the New Budget and Accounting Classification System (BACS). Four institutional levels and relevant economic codes have been clearly specified in Columns 3 to 8 of the Financial Power Delegation and Re-delegation Model 2026, ensuring consistency across ministries, attached departments and subordinate offices. Under the revised framework, the Senior Secretary, Secretary or Acting Secretary of each ministry or division will act as the Principal Accounting Officer. They will be responsible for ensuring that expenditures are incurred strictly for approved purposes, relevant financial rules are followed, budgetary limits are respected and no expenditure is made in anticipation of supplementary grants without prior approval.

The order further emphasised accurate budget classification, monthly reconciliation of expenditure with accounts provided by the Chief Accounts Officer, and prompt settlement of audit objections. Ministries are also authorised to re-delegate financial powers to attached departments and subordinate offices within reasonable limits, following a uniform model to maintain consistency across government offices. It has been clarified that officials who have already been granted special financial powers through separate government orders will continue to exercise those powers. However, if the revised delegation provides higher limits for any item, the higher authority stipulated in the new order will prevail.

All sanctions issued under the delegated authority must be sent to the concerned Chief Accounts Officer, clearly stating that the sanction has been issued under the powers delegated through this order that adequate budget provision exists in the approved budget. In cases requiring Finance Division concurrence, sanctions must be endorsed by the relevant wing of the Finance Division before being forwarded. The Finance Division stated that the order will take immediate effect from the date of issuance and remain in force until further notice.