This paper examines the public financing of climate change actions in Nepal, including the role played by communities, civil society, the private sector and international support.

The objective of the study has been to develop an appropriate methodology and then conduct an exploratory Climate Public Expenditure and Institutional Review (CPEIR), at both the national and local level. A major aim has been to show how climate change-related expenditure is being integrated into the budgetary process in response to national policy setting. Through time, as the CPEIR methodology is strengthened, it will serve as a tool to enable the Government of Nepal to improve prioritisation, efficiency and effectiveness of all public resources in support of climate change actions.

This CPEIR reviews the financial management systems as well as the institutional arrangements and policy directives for allocating and spending climate change-related finance. The study entails:

• An assessment of current policy priorities and strategies as these relate to climate change.
• A review of the institutional arrangements for promoting the integration of climate change policy priorities into budgeting and expenditure management.
• A review of the integration of climate change objectives within the budgetary process, including as part of budget planning, implementation, expenditure management and financing.