Effects of Budget Absorption on Performance of County Governments in Kenya
Abstract
Budget absorption rate refers to the share of the actual expenditure out of the
targeted(budgeted). It is a great benchmark for determining the efficiency and effectiveness of
the counties on the utilization, implementation, formulation and execution of county budget.
Absorption rate indicates the ability of the counties to co-finance projects and activities,
macroeconomics capacity and administration performance. This research sought to establish
effect of budget absorption on the performance of county government. Budget absorption is
supported by planning, organizing and a quality expenditure control tool. The research focused
on the forty-seven counties and the independent variables of the study were Budget allocation,
Development expenditure and County Revenue Collection. The secondary data was obtained
from KNBS & OCOB. The results were presented inform of tables, figures and graphs. Budget
ensures efficiency and effectiveness to the limited allocated resources. Budget is a management
and regulation tool used to effectively manage the public funds with the aim of efficiently
optimizing financial realization performance targets.
The researcher recommends the counties and national government to develop a clear
development plan that will reduce non-essential expenditure. The comprehensive development
roadmap will act as guidance and compass for the prudential expenditure. This will enhance
optimal development of projects. Moreover, the county should determine the optimal staffing
that ensure business continuity and reduce the county wage bill. The public involvement and
periodic release of county budget absorption rate report will promote prudential expenditure.
The study recommends the utilization of experts in budget formulation, utilization,
implementation and execution to realize the budget absorption
Publisher
University of Nairobi
Rights
Attribution-NonCommercial-NoDerivs 3.0 United StatesUsage Rights
http://creativecommons.org/licenses/by-nc-nd/3.0/us/Collections
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