BACKGROUND OF THE STUDY
Budget is an estimate of expected income and proposed expenditure of the government of a country for a specified period usually a year through the adoption of both fiscal and monetary policies. Budget is one of the planning tools in the hand of the government as it enables them (government) to plan for the expected income and expenditure (Onipede and Ayodeyi 2005).
According to Ekikor (2008) budget often referred to as public budget or national budget is a plan or document describing fiscal policy as well as the financial statement of the government proposed expenditure and expected revenue during a given period of time usually a year.
Also, budgeting can be seen as a setting of expenditure priorities and weighing of alternatives. It is a system of resources allocation hence it implies looking ahead and planning since decisions involved in the process are of future orientation. Therefore, budgeting involves the converting of the multiyear plan of operations into more exact short-term installments of inputs and outputs, usually, for the year ahead (Anyanwu, 1993). Budgets are usually employed to attain some objective of process stability, full employment in the economy minimization of income inequalities balance of payment equilibrium, rising growth in national output. Budget is prepared in an advance by designated officials.
It means that the proposed statement is expressed is in qualitative terms. In facts, budget is one of the planning tools in the hand of government as it enables them (government) in relation to the proposed expenditure. This is because budget directs the process of allocating resources to meet the demands as well as converting rhetoric to reality in the political system which link the past present and future in an orderly way.
However, implementation and execution of budget must have been prepared and approved. Usually after the financial allocation, it is left for the head of that ministry or parastatal to execute through the accounting and finance department which is responsible for the working of the budget although the actual allocation is the work of the accounting officer. Each amount allocated to each ministry is not released emblock. It is also the responsibility of the head to ensure that the amount allocated does not exceed the estimated amount.
Although, some of the challenges hinder effective implementing of budget of which some of them were inability to match budgetary estimates with anticipated revenue, time consuming, non-release of budgetary funds to finance what was budgeted for and the rest to mention but few.
Therefore, it was on the above context that the researcher went on to examine extensively the major challenges of implementing budgets and budgeting control in the public sector with special emphasis on Ikot Ekpene Local Government Council.
1.2 STATEMENT OF THE PROBLEM
Ikot Ekpene Local Government Council is a place where the budget is prepared to estimate the various expenses and income for each financial year. The budget is prepared by the accounts department in collaboration with various departments.
According to Essien (2006), a cursory survey would clearly reveal that the sectors of the economy are in the phrase of a critical indisposition in terms of management inefficiency, low level of productivity as a result of negative attitudes to budget and budgeting control. Though, available resources, both human and materials are scare to meet up with need of the society, budget budgeting control remain the most important instrument for sound financial planning, control and co-ordination for high performance, efficiency of government organizations establishment and public sector as a whole.
But successful budgeting itself is confronted with the following challenges: Inability to match budgetary estimates with the anticipated revenue required for its successful implementation.
Consequent upon this, there is the problem for non-releases of budgetary funds to finance what budget was for or inadequate funds generated to finance the project budgeted for. The political will implement the budget and the cumbersome nature of controlling the budget.
These challenges and more constitute the research on Ikot Ekpene Local Government Council operation.
OBJECTIVES OF THE STUDY
The objectives of this research study include:
To examine the challenges associated with implementing budgets and budgeting control in Nigeria public sector.
To examine the impact of successful budget and budgeting control on the performance of Nigeria public sector.
To examine how budgeting can be avoid wastage
To evaluate the performance of government budgeting/ implementation in the public sector.
Based on the objectives of the study, the following research questions were raised.
(i) What are the challenges associated with implanting budgets and budgeting control in Nigeria public sector?
What is the impact of successful budgets and budgeting control on the performance of Nigeria public sector?
Why is budget necessary for effective operation in the Local Government?
Is budget necessary for effective operation for budget performance/ implementation considered good in the public sector?
STATEMENT OF HYPOTHESES
HO: Inability to match budget estimates with the realized anticipated revenue is not a significant challenge associated with budget implementation in Nigerian public sector.
HA: Inability to match budget estimates with the realized anticipated revenue is a significant challenge associated with budget implementation in Nigerian public sector.
HO: Inadequate executive capacity in the implementation of budgets is not a significant impediment associated with budget implementation in Nigerian public sector.
HA: Inadequate executive capacity in the implementation of budgets is the significant impediment associated with budget implementation in Nigeria public sector.
HO: Proper budgeting and controlling has not been carried out very effectively by management of Ikot Ekpene Local Government Council.
HA: Proper budgeting and controlling has been carried out very effectively by management of Ikot Ekpene Local Government Council.
HO: Budget implementation at the end of each financial period does not achieve most of the set goals.
HA: Budget implementation at the end of each financial period have achieved most of the set goals.
1.6 SIGNIFIANCE OF THE STUDY
It is hoped that the result of this research will be of interest to the parents, students, government and all those interested in budgets and budgeting control in the public sector.
Hence, this public study is important since it would highlight the possible challenges of budgeting in an organization, the dynamic nature of the organization and the technological environment in which budgets are prepared. Thus, this study will reveal the desirability and method of budgeting prepared by ministry departments and agencies of government.
This study is also significant since the finding and recommendation resulting from it will be beneficial to the organization, ministry department and agencies of government in general.
Finally, the research study is significant since the materials will serve as a source of reference to other researchers who may want to carry out further research on this topic or related areas in the future.
1.7 SCOPE OF THE STUDY
This study focuses on the topic “The challenges of implementing budgets and budgeting control in the public sector using Ikot Ekpene Local Government Council” as a study unit. It will discuss the budgeting process and its implementation. However, its scope is limited to Ikot Ekpene Local Government Council.