COMPARATIVE BUDGET PERFORMANCE BEFORE COVID 19 AND AFTER COVID 19 IN NIGERIA

COMPARATIVE BUDGET PERFORMANCE BEFORE COVID 19 AND AFTER COVID 19 IN NIGERIA

Table of Content

Abstract

Chapter One: Introduction

1.1 Background of the Study

1.2 Statement of the Problem

1.3 Objective of the Study

1.4 Research Questions

1.5 Research Hypothesis

1.6 Significance of the Study

1.7 Scope of the Study

1.8 Limitation of the Study

1.9 Definition of Terms

1.10 Organization of the Study

Chapter Two: Review of Literature

2.1 Conceptual Framework

2.2 Theoretical Framework

2.3 Empirical Review

Chapter Three: Research Methodology

3.1 Research Design

3.2 Population of the Study

3.3 Sample Size Determination

3.4 Sample Size Selection Technique and Procedure

3.5 Research Instrument and Administration

3.6 Method of Data Collection

3.7 Method of Data Analysis

3.8 Validity of the Study

3.9 Reliability of the Study

3.10 Ethical Consideration

Chapter Four: Data Presentation and Analysis

4.1 Data Presentation

4.2 Test of Hypotheses

Chapter Five: Summary, Conclusion and Recommendation

5.1 Summary

5.2 Conclusion

5.3 Recommendation

References

QUESTIONNAIRE

 

 

ABSTRACT

This study was carried out on the comparative budget performance before Covid 19 and after covid 19 in Nigeria” using Lagos as a case study. The Chapter one dealt with introduction, background to the study, statement of the study, significance of the study and rounded up with the organization, chapter three dealt with the methodology used for the study. the chapter four dealt with the presentation of the data and analysis. The study has therefore shown that the Covid-19 pandemic has significant effect on the budgetary performance of Lagos state. As the government has engaged the Economic Sustainable Plan (ESP, 2020), which is a post-Covid-19 recovery plan, it is hoped that the attendant policies would be properly implemented so as to provide the critical mass to repositioning the country’s economy on the path towards inclusive and sustained economic development.

 

 

CHAPTER ONE

INTRODUCTION

• Background of the study

Government efforts to achieve macro-economic goals and objectives of price stability, stable and full employment, economic growth, infrastructural development as well as Balance of Payments equilibrium, emanates the call for enormous budget such as Deficit, surplus, balanced, development as well as supplementary budget. Budget as a vital economic policy instrument of government reflects the government priorities in respect to her social and economic policies. Therefore, this instrument translates policies, campaign promises, political commitments and goals into decisions regarding revenue generation, funds allocation and the manner it will be expense.

The sources of revenues to fund government budget is from Petroleum products and taxes. Budget is base on expected revenue from Petroleum normally estimated at per barrel price and added to taxes revenues. Consequent upon this, where there are fluctuations in the market price of Petroleum products, there is bound to be an adjustment on the estimate tom reflects the current situation. Falete (2017) attested four basic qualities for a budget to perform its obligation – it should be well designed; effectively and efficiently implemented; adequate monitoring and finally performance evaluation. From the above named features, the primary aim of a budget is not in its formulation or initiation rather in its implementation which is expected to meet the needs and aspirations of its citizenry.

Olomola (2009) opined that the process of budgeting has always been attributed to unending faults and constraint with budget implementation. The Nigeria’s budget process includes budget preparation by the executive, legislative approval and implementation by the different ministry, department and parastatal of the government. The implementation of budget by incurring expenditures is carried out by ministries and spending agencies of the government through the use of warrants issued by the Ministry of Finance. This warrant authorizes officers controlling votes to incur expenditure stated in the approved estimates which is subject to any reserved items. In a situation the Appropriation Act has not come into operation at the beginning of the year, a provisional General Warrant may be issued to ensure unhindered services of government at a level not exceeding those of the previous year. The challenges to the efficiency of budget implementation are mostly partial release or non-release, delay in releasing approved funds for budgeted expenditure.

Since the debut of COVID-19 in Nigeria on 27th February 2020, the Nigerian economy appeared to have entered turbulence. Thirteen days after its importation from Italy, precisely March 11, the World Health Organisation (WHO) declared COVID-19 a global pandemic. As the spread of the virus continues internationally and locally at an unimaginable scale, the official responses appear to focus mainly on limiting the spread within the country through social isolation policies, which include shutting educational institutions, limiting work and restricting movement of people, providing palliatives to the “vulnerable and poorest of the poor”, imposition of night time curfews, and so on. Many observers believe that as much as the virus keeps spreading, assessment of the depth and the breadth of the impact of the pandemic on the social and economic life of the nation is difficult, if not impossible, until the situation returns to normal. But, how will the pandemic end? What will be the aftermath effect? This uncertainty is pervasive and have created a strong sense of foreboding among the general public, researchers and policy makers.

The uncertainty surrounding the emergence of the disease notwithstanding, even as the outbreak persists, several strands of studies have emerged to examine the macroeconomic impact of it at global, continental and country level. The study by McKibbin and Fernando (2020), which is an extension of McKibbin and Sidorenko (2006), explores seven different scenarios of how COVID-19 might evolve in the coming year. The paper alluded to the fact that the evolution of the disease and its economic impact is highly uncertain thereby making it difficult for policy makers to formulate appropriate macroeconomic policy response. The scenarios investigated in the study demonstrate that containment of the outbreak notwithstanding, its impact on the global economy in the short run would still be significant. Other recent studies with global concern include Barua (2020), OECD (2020), Orlik et al (2020), Maliszewska et al (2020) and Fernandes (2020). In Fernandes (2020), the economic impact of COVID-19 crisis across industries, and countries is investigated. The study shows that in the sample of 30 countries covered, a median decline of -2.8% in GDP in 2020 is observed. In other scenarios, the study shows that GDP is expected to fall more than 10%, and in some countries, more than 15%. Orlik et al (2020) even predicted that coronavirus could cost the global economy US$2.7 trillion. “A baseline global pandemic scenario sees gross domestic product fall by 2 percent below the benchmark for the world, 2.5 percent for developing countries, and 1.8 percent for industrial countries” (Maliszewska et al (2020).

In what looks like a subtle criticism of the public media and academic writings for focusing mainly on global macroeconomic impact of COVID-19, Ataguba (2020) argues that it “is only one part of the bigger picture of economic impact”. Citing Africa in particular, with its high disease burden, poorly developed infrastructure and safety nets and weak health systems, the impact of the pandemic is expected to be severe in the continent. Using the same argument, a country level impact analysis is not only desirable but inevitable to guide the policy authorities. The likely exacerbating impact of the pandemic on the Nigerian economy is inevitable for several reasons. Firstly, the economy is yet to fully recover from the aftermath of the recession experienced in 2016. Secondly, the economy depends largely on crude oil whose price has plummeted in the international market. Thirdly, the foreign exchange reserves have been drawn down from US$45.1bn at the end of 2019 to US$35.3bn at the end of March 2020. Fourthly, the country’s debt burden has been mounting since 2015. Fifthly, inflation is still firmly in double digits and the naira is under pressure. Finally, the health system capacity is abysmal. These and other factors have led to the growing concerns and uncertainties that COVID-19 will bring on the Nigerian economy. According to Ozoli (2020), “the economic downturn in Nigeria was triggered by a combination of declining oil price and spillovers from the COVID-19 outbreak”.

Many African countries have relatively weak health care systems, proactive measures to prevent the spread of the virus will be critical. Countries should step up campaigns to educate the public on best practices, including promoting good hygiene and social distancing, discouraging large public gatherings, and encouraging employers to protect the jobs of employees who require quarantine or treatment. Campaigns should elicit the help of religious and civil society leaders for maximum effect.

“It is unavoidable that the novel coronavirus epidemic will have a considerable impact on the economy and society” – China’s president Xi Jinping, televised address, February 23, 2020. “The spread of the new coronavirus is a public health crisis that could pose a serious risk to the macro economy through the halt in production activities, interruptions of people’s movement and cut-off of supply chains” – Japanese Finance Minister Taro Aso. G20 gathering in Riyadh, Saudi Arabia, February 24, 2020. “Honda Motor Co. will reduce vehicle output at two of its domestic plants in Saitama Prefecture for a week or so in March due to concerns about parts supply from China where a new coronavirus outbreak continues to disrupt economic activities” – Honda spokesperson, March 3, 2020. Besides its worrying effects on human life, the novel strain of coronavirus (COVID-19) has the potential to significantly slowdown not only the Chinese economy but also the global economy. China has become the central manufacturing hub of many global business operations. Any disruption of China’s output is expected to have repercussions elsewhere through regional and global value chains. Indeed, most recent data from China indicate a substantial decline in output. China Manufacturing Purchasing Manager’s Index (PMI), a critical production index, fell by about 22 points in February. This index is highly correlated with exports and such a decline implies a reduction in exports of about 2 percent on an annualized basis. In other words, the drop observed in February spread over the year is equivalent to -2 percent of the supply of intermediate goods. Indicators on shipping also suggest a reduction in Chinese exports for the month of February. Container vessel departures from Shanghai were substantially lower in the first half of February with an increase in the second half. However, the Shanghai Containerized Freight Index continues its decline thus indicating excess shipping capacity and lower demand for container vessels.

The case is also the same in Nigeria, the Corona virus disease (COVID-19) outbreak has put everything on hold in the country. The total figures of corona virus patients in Nigeria have risen to 12 after four new cases were confirmed in Lagos State on Thursday.

Lagos State health commissioner Akin Abayomi announced the new cases in Ikeja during a press conference. Abayomi disclosed that 14 people were tested but four tested positive for the coronavirus adding that one of the new index cases had contact with the third confirmed case in Nigeria. The commissioner said one of the patients, a Nigerian female, came into Lagos on Saturday, March 14, 2020, in a Turkish airline TK1830. A Nigerian man in his 50s who never travelled anywhere is among the new four cases, Abayomi said. He said the last patient is a Nigerian male who arrived the country in a Lufthansa (airline) LH568 on Friday, March 13, 2020. Abayomi said the patients have been isolated for treatment at the Infectious Disease Hospital, Yaba, Lagos. The commissioner, however, said more tests are being carried as there is a “combination of imported cases and local transmission. The Executive of Lagos State is meeting on the next stage of social distancing. “The best way to slow the rate is to halt the movement of the virus from person to person,” Abayomi said. “Currently, we are following over 1,300 people right now to find information about the state of their health and the number is increasing.” He appealed to people on the two flights to self-isolate themselves and contact the government.

Sequel to the above, the plan of this study is to analyse the comparative budget performance before COVID 19 and after COVID 19 in Nigeria;  using Lagos as a case study. It will examine the impact of the emergence of COVID-19 on the budget performance in Lagos state and make projections for economic growth for the state and Nigeria at large.

1.2       Statement of the problem

The outbreak of corona virus disease (COVID-19) pandemic in Nigeria has increase the level of tension and anxiety among citizens in the country. The virus unlike other cases we have had in this country is highly transmittable with severe signs and symptoms. The outbreak of corona virus disease (COVID-19) might have effect on the Nigeria economy through low imports and exports in the country, poor tourism remittance and commodity price rate in Nigeria. Lastly there have been studies on corona virus disease (COVID-19) but not even a single study is based on the economic implication of the coronavirus epidemic on Lagos state economy; hence a need for the study.

1.3       Objectives of the study

The main aim of the research work is to determine the Comparative budget performance before COVID 19 and after COVID 19 in Nigeria” using Lagos as a case study. The specific objectives of the study are:

1. to determine the impact between corona virus disease (COVID-19) on the Lagos state economy
2. to determine the causes of corona virus disease (COVID-19)
3. to determine the impact of corona virus disease (COVID-19) on Lagos budget performance
4. To examine the budget performance before COVID 19 in Lagos state

1.4       Research questions

The study came up with research questions so as to ascertain the above stated objectives of the study. The following research questions guide the objectives of the study:

1. What is the impact of corona virus disease (COVID-19) on the Lagos state economy?
2. What are the causes of corona virus disease (COVID-19)?
3. What is the impact of corona virus disease (COVID-19) on Lagos budget performance?
4. What is the budget performance before COVID 19 in Lagos state?

1.5       Statement of the hypothesis

H01: there is no significant difference in the budget performance before and corona virus disease (COVID-19) in the Lagos state

H02: corona virus (COVID-19) has no significant effect on the Lagos state economy

1.6       Significance of the study

The study on the effect of corona virus disease (COVID-19) on the Lagos state economy will be of immense benefit to all the Lagos state citizens, the health sector, and the federal government of Lagos state. The study will explore the prevalence of corona virus disease (COVID-19), the causes, and the effect of the corona virus disease (COVID-19) the Lagos state economy. The study will educate the masses on the mode of transmission of the corona virus disease (COVID-19) and the preventive measures to be adopted.  The study will educate the Lagos state government on the policy implementation to curb the prevalence of the corona virus disease (COVID-19) and how to improve the Lagos state economy during this period. The study will serve as a repository of information to other researchers that desire to carry out similar research on the above topic. Finally the study will contribute to the body of the existing literature on the effect of corona virus disease (COVID-19) on the Lagos state economy

1.7       Scope of the study

The study will cover on the effect of corona virus disease (COVID-19) on the Lagos state economy.specifically the budgetary performance

1.8       Limitation of the study

Financial constraint– Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information.

Time constraint– The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.

COMPARATIVE BUDGET PERFORMANCE BEFORE COVID 19 AND AFTER COVID 19 IN NIGERIA. GET MORE CORONA VIRUS (COVID-19) PROJECT TOPICS AND MATERIALS

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