Public Budgeting Deficiencies in Sub-Saharan Africa: A Review

By Sekwat, Alex | Journal of Public Budgeting, Accounting & Financial Management, Spring 1997 | Go to article overview
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Public Budgeting Deficiencies in Sub-Saharan Africa: A Review


Sekwat, Alex, Journal of Public Budgeting, Accounting & Financial Management


ABSTRACT. This article provides an overview of the major deficiencies affecting public budgeting in Sub-Saharan Africa. The article describes the major budgetary problems which include instability and uncertainty, repetitive budgeting, budget fragmentation, weak revenue base, inadequate expenditure control and accountability, declining donor assistance, and disparity between planning and budgeting, in light of conditions in the region's environment among which are adverse global economic conditions and extreme internal parameters of underdevelopment such as widespread poverty, civil wars, and natural disasters. The article concludes by providing a broad agenda for improving the current state of public budgeting in the region including specific proposals for reform.

INTRODUCTION

Budgeting in Sub-Saharan Africa(l)(SSA) as in other poor regions of the world is hampered by many endogenous and exogenous problems. Until such problems or deficiencies are addressed, budgeting cannot be a useful tool for economic development and policy reform in the region. The major budgetary problems examined include: Persistent uncertainty and instability, repetitive budgeting, budget fragmentation, lack of adequate expenditure control and accountability, insufficient donor assistance, and poor linkage between budgeting and planning. Such problems exist with extreme conditions of underdevelopment. This undermine efficient allocation and utilization of scarce resources and diminishes the role of budgeting as an important tool for attaining accelerated economic development in SSA. Currently, because of these problems, budgeting in SSA is characterized by lack of reliable systems where funds are not (a) spent for the purposes they were intended for, (b) adequately accounted for, accurately forecasted to facilitate maximum use and distribution of resources, and (d) appropriately programmed to avoid bottlenecks. To highlight the impact of these problems on budgeting, the experience of a few countries in SSA are cited throughout the article. However, no detailed account of the experiences of many other countries is provided. Lack of adequate case studies and the sparseness of the literature on this subject limited the discussion of the problems to generic terms, which in a way illustrates a major limitation in conducting a study in this area of the world.

Because extreme conditions of underdevelopment negatively affect sound budgetary practices, their root causes are examined first, followed by review of the major problems affecting budgeting in SSA. Then, the article concludes by proposing a broad agenda for budget reform.

PARAMETERS OF UNDERDEVELOPMENT

The environment of public budgeting in SSA is more arduous compared to that of developed countries and Newly Industrialized Countries (NIC). Unlike other regions which have made considerable strides in improving the living conditions of their people, SSA continues to be plagued by extreme conditions of underdevelopment. In recent years, developing countries in Asia and Latin America successfully continue to push their way into the liberalized global economy, while political instability and economic crisis continue to deepen in SSA. During the past decade most regions of the world experienced almost uninterrupted economic activity, by contrast virtually all SSA countries registered either negative or low real growth rates and declining per capita incomes (Saunders and Senbet, 1992). In the 1980s, the region's gross domestic product (GNP) per capita declined by more than one percent a year as its population increased and its share of global foreign direct investment fell from 10 percent in 1987-91 to 3.6 percent in 1995 (The Economist, 1996, S4).

Currently, most countries in SSA face extreme conditions of underdevelopment, widespread and absolute poverty, deficient industrial and infrastructure development, inadequate technological resources, bureaucratic ineptitude, less diversified economies, political instability, high and rising levels of unemployment or underemployment, low and stagnant levels of agricultural and industrial output, extensive levels of corruption and mismanagement, severe balance of payment and international debt problems, increased dependence on foreign assistance, and high rates of inflation.

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