In the dynamic world of public finance, creating a realistic budget framework is paramount to the success of a state’s economic development. A well-crafted budget is the bedrock of sound financial management for any government entity. In the case of Cross River State, the transition from the administration of former Governor Ben Ayade to the current leadership under Governor Bassey Otu presents a unique opportunity to revamp the budgetary framework to fit for purpose. The pitfalls of Ayade’s unrealistic budget templates serve as crucial lessons to avoid.
Former Governor Ben Ayade’s tenure was marked by a budget template riddled with unrealistic projections and a sense of dubious public financial underpinnings characterized by unfulfilled promises. It was an era of ambitious promises and grandiose visions with a lack of realism and misaligned priorities. Ayade’s budgets painted a picture of significant infrastructural projects and social programs, but the implementation fell far short of these promises. In contrast, under the leadership of Governor Bassey Otu, the state has the opportunity to stem the tide and build a realistic budget framework that aligns with the genuine needs and aspirations of the people.
Effective budgeting is a critical aspect of good governance, essential for achieving economic growth, infrastructural development, and social welfare in any state. This piece will delve into the importance of a realistic budget, analyze the flaws in Ayade’s approach, and explore the steps that must be taken by Governor Otu to build a sustainable and transparent budget framework for the betterment of Cross River State.
A budget is a financial blueprint and one of the most important policy documents that outline a government’s revenue, expenditure, and investment plans for a specific period, usually one year. A realistic budget ensures that public funds are efficiently allocated, fosters fiscal responsibility, and allows for the realization of development objectives. It is a crucial tool in fostering economic growth, enhancing service delivery, and creating an environment of accountability and transparency.
A realistic budget framework is one that reflects the actual revenue generation capacity of the state, allocates resources based on priority needs, and ensures efficient implementation, and monitoring of projects, preventing wastage and misappropriation. By investing in strategic sectors, a realistic budget can quickly stimulate economic growth and attract private sector and foreign direct investments.
One of the major pitfalls of Ayade’s budget was the overestimation of revenue sources. The budgets often relied on projections that were overly optimistic, leading to revenue shortfalls and a subsequent lack of funds for proposed projects. This misalignment between revenue projections and actual income hindered the state’s ability to deliver on critical initiatives and eroded public trust in the government’s ability to manage finances effectively.
Another issue was the tendency to focus on high-profile projects at the expense of essential services. While the budgets showcased impressive infrastructure proposals, sectors like healthcare, education, and social welfare were often neglected. This imbalance resulted in a failure to address the pressing needs of the populace and hindered the state’s progress towards achieving sustainable human development.
Additionally, the lack of transparency and accountability in budget execution led to suspicions of mismanagement and corruption. The opaque nature of financial transactions and the absence of clear reporting mechanisms undermined public confidence in the government’s commitment to accountability.
Again, with the budgetary deficiencies and lack of coordination, many projects initiated during Ayade’s tenure either faced significant delays or were left unfinished, hampering economic growth and social development.
In contrast to his predecessor, Governor Bassey Otu should take proactive measures to establish a realistic budget framework that prioritizes transparency, efficiency, and accountability. Some key initiatives have to be implemented to achieve this goal:
Comprehensive Revenue Assessment: Governor Otu’s administration should conduct a thorough assessment of the state’s revenue potential, taking into account various economic factors and trends. This would ensure a more accurate revenue projection and reduce reliance on speculative income sources.
Stakeholder Consultation: The Otu administration should actively engage with stakeholders, including representatives from various sectors and the public, to gather input and ensure that the budget aligns with the needs and aspirations of the people.
Performance-Based Budgeting: Governor Otu should introduce performance-based budgeting, where projects and programs are evaluated based on their expected outcomes and impacts. This approach promotes efficient resource allocation and ensures that funds are directed toward projects that yield tangible benefits for the state.
Debt Sustainability Analysis: To avoid excessive debt accumulation, the Otu administration should conduct regular debt sustainability analysis to assess the state’s ability to service its debt obligations. This practice ensures responsible borrowing and prevents a debt crisis. The administration should also set a debt ceiling for the state and operate within that limit.
Project Monitoring and Evaluation: To enhance project delivery, the current government should establish a robust monitoring and evaluation mechanism. This helps to track project progress, identify bottlenecks, and make timely adjustments to ensure successful project completion.
Technology Integration: Governor Otu’s administration should leverage technology to improve financial management and budget execution processes. The use of digital platforms streamlines budget reporting, enhances transparency, and reduces the risk of financial mismanagement.
Building a realistic budget framework in Cross River State under Governor Bassey Otu’s leadership will be a transformative step towards fiscal responsibility and sustainable development. By learning from the pitfalls of former Governor Ben Ayade’s bogus and unrealistic budget template, the state will make considerable progress in fostering transparency, accountability, and prudent financial management.
Governor Otu’s administration should commit to stakeholder engagement, revenue assessment, performance-based budgeting, and technology integration for a more effective allocation of resources and improved project execution. As Cross River State continues its journey toward economic prosperity, the emphasis on a realistic budget framework will be pivotal in ensuring the state’s development objectives are achieved while avoiding the mistakes of the past.
Oyama is an economist and a concerned Cross Riverian who writes from Abuja. He can be reached via missangoyama@gmail.com
NB: Opinions expressed in this article are strictly attributable to the author, Missang Oyama, and do not represent the opinion of CrossRiverWatch or any other organization the author works for/with.
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