BUDGETING IN PUBLIC SECTOR ECONOMY “CASE STUDY OF ENUGU STATE GOVERNMENT”

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ABSTRACT

 

The purpose of the study is to determine the effect of budgeting on the economic development of the state to determine the factors which account for the difference between the capital expenditure and the recurrent expenditure and to take an overview of the analysis of the relationship between estimated and actual expenditure in the last five financial years. The study is aimed at improving budgeting as an effective tool for financial planning and control in the state public sector. Some of the problem associated with this study include , ascertaining whether the budget is usually prepared aimed at realizing the states objectives or if the budgets and make  them look ambitious why are budget bigger or smaller over the year? What account for deficits or surplus budgets?

Five years consolidated financial statement of estimates of Enugu state of Nigeria , approved revenue estimated , actual revenue and revised revenue estimates. The instrument of data collection was a structured questionnaire and it was self-administered. The data so collected was put in a form that allowed for easy comparison.

The findings reveal the “call circulars” are issued in July and that the “estimates committee” is the only body charged with reviewing proposals from every ministry and government bodies. The state has not adopted the planning programming and budgeting system [ PPBS]. The states major source of revenue are the federation account and states internal revenue though the states share of the federation account is received monthly , it is received short of the expected revenue. It was also found that while the civilian budget was mostly done at a deficit, that of military government is either a balanced one or a surplus one.

The implication of this findings for budget preparations ,revenue control and budgeting techniques , measurement and assessment are discussed. Some recommendations are made regarding how budgeting can be improved to help check the up- surge of recurrent expenditure and improving the internally generated revenue.

 

 

 

 

TABLE OF CONTENT

      CHAPTER ONE

1.0 INTRODUCTION

• Objective of the study
• Purpose of the study
• Significant of the study
• Statement of the hypothesis
• Limitation of the study
• Scope of the study
• Definition of terms

 

        CHAPTER TWO

2.0 REVIEW OF RELATED LITERATURE

2.1 The historical literature framework

2.2 Revenue allocation formula in Nigeria

2.3 Enugu state budgeting

 

     CHAPTER THREE

3.0 RESEARCH DESIGN AND METHODOLOGY

3.1 Source of data

3.2   Primary source of information

3.3Secondary source of information

 

    CHAPTER FOUR

4.0 DATA PRESENTATION AND ANALYSIS

4.1 Data analysis

• Test of hypothesis

 

 

CHAPTER FIVE

5.0 SUMMARY OF FINDING , CONCLUSION, AND RECOMMENDATION.

5.1 Findings

5.2 Conclusion

5.3 Recommendation

Bibliography

Appendix: questionnaire.

 

 

CHAPTER   ONE

 

 INTRODUCTION 

In    his budget of December 23, 2003 presented the year 2004 budget, there the governor of Enugu state governor CHIMAROKE  NNAMANI said that the thrust of the 2004 budget is poverty reduction of the people. The state government appreciated the dangers of delaying OF delaying the narrowing of gay  between the tow socio-economic order ,the rich and the poor so as to provide  equal footing for both .

For proper integration of social and economic environment in the state ,it has become imperative to reduce unemployment and poverty in the state to the barest minimum . For us in Enugu state  it meant drastic reduction in personnel cost ,recovery of government funds and properly filtered away during the civilian administration  ,increase in internal revenue generation ,judicious spending and accountability .         Though ,a budget can be prepare simply on the basis of what was done on the pervious year ,adjusted for any change in condition or scope of the activity that may be anticipate for the coming year, a soundly conceived budgetary plan should be such that will  simulate the executive to take a more critical view of his own operation .

The fundamental difference between the public sector and private sector is that the later is organics and operated to make a profit for its owner while the former exists to provide  services to its citizens substantially on a non-profit basis .  The Enugu state Annual Budget  like any other state in the federation consists of tow segments:    the recurrent expenditure and the capital expenditure .However the drastic collapse in oil revenue over the year is one factor that has seriously affected state budgets  .Also the recent federal government ban on the state from securing loan from external or internal sources and the heavy dependence on  imports for  essential raw material spare parts and capital goods has continued to affect the state budgeting . Others include unacceptable high  rate of inflation and unemployment ,low productively ,and an adverse debt repayment position .it is this state of affairs that made Enugu state government to adopt the following strategies to achieve the derived goals .

 

A}          Maximization of internal revenue by improving the revenue collection machinery and policies .

 

B}     judicious management of expenditure  so as to conserve scare fund .

 

C}  concentration of attention on the execution and completion of some selected project in the various sector ; thereby avoiding the used mistakes of preaching scarce resources thing over tow many project and achieving little or nothing .

 

1.1      OBJECTIVE   OF THE   STUDY 

The study aims at collecting quantities information on budgeting  control measures.   Data generation from such information  are essential for :