Impact of Budget Implementation on Economic Performance in Nigeria

Abstract

The issue of budget implementation has long been a source of concern to the public and also considering the important impetus of budget implementation on economic growth and development in Nigeria. Over the years, the impact of an increasing size of government operations without commensurate benefits or direct link to economic growth has become an emerging major public debate. Nigeria's public expenditure has been increasing year by year, mainly for the purpose of boosting her economic development. While Budget is considered the Chief policy of government in achieving other policy objectives, unfortunately, the achievement of this objective has continued to elude the country. The major aim of this study was to determine how budget implementation by Nigeria affected her economic performance during the period from 2010 to 2020. Specifically, the study sought to examine the impacts of public capital and recurrent expenditures on Nigeria’s real gross domestic product. This study reveals that recurrent government expenditure has a positive relationship with the economic growth, this implies that an increase in the units of recurrent government expenditure will lead to an increase in the economic growth of Nigeria in the period analyzed, whereas capital government expenditure has a negative relationship with the economic growth, this implies that an increase in the units of capital government expenditure will lead to a decrease in economic growth of Nigeria. These results suggest that due process was compromised at the budget implementation stage. The study recommends that government should ensure the strict adherence to due process in the implementation of its annual budgets. Proper oversight functions should also be carried out by relevant supervisory agencies saddled with such responsibility to ensure maximum compliance by service public goods providers