THE MANAGEMENT OF FINANCIAL RESOURCES AND THE PERFORMANCE OF LOCAL GOVERNMENT
This study has been able to identify some of the problems arising from the management of Patani, Ndokwa West and Sapele Local Government Council’s resources and performance evaluation. These problems have been the bane of Local Government Councils not living up to expectations of the grassroots. Some of the findings were that, internal revenue was so poor that it could hardly support any meaningful development. The Local Government Councils inadequately tapped the internal sources of revenue. The Local Government Councils relied more on statutory allocation from the Federation Account to fund their obligations. The Local Government Councils spent a greater chunk of their revenue on recurrent than on capital development. Not left out in the findings were the stricter control of the councils by the State Government through the State Local Government Joint Account. The delay in the conduct of elections into the Local Government Councils by the State Government which led to the use of Transition Committee to administer the affairs of councils. Based on the above findings, recommendations were made that the Local Government Councils should put more effort to improve on their internal revenue performance so as to reduce the rate of their dependence on statutory allocation from the Federation Account. The Federal Government should take-off the responsibility of funding of primary education from the shoulder of councils so as to leave them with more fund for capital development. As a Third Tier of Government, the Federal Government should ensure that councils are given financial autonomy and allow them to operate without external control. Also, the Local Government Councils should reduce their spending on recurrent expenditure to enable them have more fund for capital development ventures. The Federal Government should prevail on the State Government to stop the use of Caretaker Transition Committee in place of elected Officers to run the Local Governments so as to prevent fund diversion.
1.2 STATEMENT OF THE PROBLEM
The problems militating against the efforts of the local Government Councils in the attainment of an efficient and effective discharge of statutory functions to the Local Communities are enormous. However, with regards to this, the underlisted statements of problem are considered:
- The extent to which the internal sources of revenue are harnessed to boost the Local Government revenue base.
- The extent to which funds are committed to capital development in relation to capital receipts.
- The resources of the Local Government Councils are meant to be utilized for efficient and effective discharge of statutory obligations. Are these resources well managed to guarantee efficient and effective performance?
- The rapid development of rural communities is the sole aim of establishing Local Government. Does the formal structure of the Local Government system affect the level of performance?
1.3 OBJECTIVES OF THE STUDY: The Local Government Councils are established and assigned with significant roles and responsibilities which they are expected to carry out in response to the developmental demands of the Local Communities under coverage. With the huge amount accruing monthly from the federation account and the 10% of State Governments internally generated revenue to the coffers of the Local Governments, it is expected that the overall essence of having Local Governments in place is met. At this junction, the study of the management of the resources and the performance of the Local Government becomes imperative. Thus, it is this intent that the study examines the following objectives namely:
- To ascertain whether there is any relationship between internally generated revenue and budget performance.
- To determine the relationship between budgeted and actual expenditure.
- To determine whether the flow of statutory allocation is positively related to budgetary performance in the Local Government Level.
On the whole, this study also intends to highlight the prospects and recommendations on how to improve the internal revenue generation capabilities of the Local Government Councils so as to necessitate the attainment of the essence of establishing Local Governments. 1.4 RESEARCH QUESTIONS: To aid this study, the undermentioned research questions are considered. i Is there any relationship between internally generated revenue and budget performance? ii. Is the relationship between budget and actual expenditure statistically significant? iii. Is the flow of statutory allocation positively related to Local Government budgetary performance?
.5 RESEARCH HYPOTHESIS: