IMPACT OF BUDGET REFORMS ON BUDGET IMPLEMENTATION IN NIGERIA
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND TO THE STUDY
According to Abdullahi (2007), a government budget is a political and administrative instruments by which the executive and legislative bodies endeavour to allocate scarce resources among the various organs of government either at state levels or federal level. It is basically a tool for selecting a particular mix of public and private goods and services. In the public sector, budget performs the same allocative functions that the price mechanism performs in the private sector (Abdullahi, 2011).
The budgetary reforms objectives of the federal government of Nigeria adopted in 1999 was aimed at reducing the excessive share of the budget being allocated to the public service by way of personnel and overhead costs (estimated at over 60%), reducing the cost of governance in general, improving resource management by curtailing wasteful expenditure and increasing the level of productivity and eiciency through budget discipline. Paradoxically, the government expenditure has lost its objective as it becomes more concerned with recurrent expenditure and less concerned with capital expenditure (Ige,
2004). The habits of contractors making remobilization claims before reviving abandoned projects also contributed to high cost of governance and poor budget implementation in Nigeria. The result of this, was that large sums of money were released and the economy overheated with cheap money resulting in lack of any real progress in project implementation (Nzewi, 2011). In terms of ensuring good budget implementation in Nigeria, public oicers in Ministries and extra ministerial departments are yet to imbibe the culture of incurring expenditures only for essential purposes, in order to control costs. Public oicers instead see government resources (money) as a “national cake” (Abubarkar, 1999). Budget failure is not new in Nigeria and it cannot be blamed on the global economic crisis experienced in 2008-2009. The reason may be that the executives both at the federal and state levels have oen diverted public funds into their personal foreign and local banks accounts.
