Fiscal Accountability Dilemma In Nigeria Public Sector: A Warning Model For Economic Retrogression

The diagnostic survey conducted in 2001 into the Federal Government public procurement revealed that Nigeria lost several hundred billions of Naira over the last few decades due of flagrant abuse of procedures, lack of transparency and merit in the award of contracts in the public sector. Measures like legislative committees, financial audit, ministerial control, judicial reviews, anticorruption agencies, advisory committees, parliamentary questions and public hearing to ensure accountability in the public sector as in developed countries were adopted yet no tangible result has been achieved. This study investigated accountability in the Nigerian Public Sector. The population of the study is Nigeria public sector and the sample frames was drawn from Ministry of Finance, Presidency, Ministry of Works, and National Assembly. Source of data was primary and were collected through structured questionnaire which was distributed to 100 management staff of the above organizations at random. Data were analyzed using Pearson Product Moment Correlation with the aid of SPSS. The result showed that there is weak accountability in Nigeria due to weak accounting infrastructure, poor regulatory framework and attitude of government officials. It was recommended that the government, professional accounting bodies and citizens should work together to have a meaningful resolution on this issue as a matter of urgency.

Introduction

1.1 Background of the Study

Government exists to serve the needs of the citizens and ensure those needs are provided efficiently and effectively. It accomplishes these goals by providing clear processes and structures for all aspects of executive management (decision-making, strategic alignment, managerial control, supervision and accountability). Governance in both private and public arena has been a hot topic and now hotter due to various recent financial scandals. Citizens and regulators are calling for higher levels of transparency and accountability in all areas of business especially in public service. In a recent study, the World Bank found a significant relationship between good governance and high level of performance (Word Bank 1997). This generated the issue of using appropriate accounting method and today, many countries government are adopting accrual basis of accounting to improve governance and control which is a common practice in the private sector.

Accountability is made possible when there is an established clear link between expenditures and performance. Accrual accounting helps agencies focus on outcomes and results rather than budgets and spending. Accountability is a concept in ethics and governance with several meanings and it is often used synonymously with such concepts as responsibility, answerability, blameworthiness, liability, and other terms associated with the expectation of account-giving. It stands out as a cherished goal of every civilized and well constituted government all over the world. Accountability is increasingly being used in political discourse and policy documents because it conveys an image of transparency and trustworthiness (Bovens, 2006) and its evocative powers make it indescribable. Government is entrusted with public funds and other resources, and must adhere to the highest ethical standards, honesty, integrity, propriety and objectivity to ensure optimum utilization. These goals can be achieved only through a combination of individual professionalism, personal standards and a rigorous control framework. Openness and transparency help instill public confidence and trust and are increasingly considered basic operating requirements for any government.

1.2 Statement of Research Problem

The diagnostic survey conducted in 2001 into the Federal Government) public procurement revealed that "Nigeria lost several hundred billions of Naira over the last few decades due of flagrant abuse of procedures, lack, of transparency and merit in the award of contracts in the public sector and accountability quandary (Uremadu, 2004). The problem of this research paper is based on the perceived weak accountability of government fund by public servants in Nigeria which has not only increased the height of corruption but also resulted in enormous waste of national resources and decay of economic infrastructure within the economy. Other problems include poor planning and implementation of national budget experienced in all facets of Nigeria public sector, lack of transparency leading to mistrust and other negative consequences, weak accounting infrastructure which may not support accountability of government funds and finally, all the above problems has created room for diverse economic disorder and resulted in under backwardness.

1.3 Research Objectives

The main objective of this paper is to investigate the extent of accountability in the public sector of Nigeria economy within 2006 and 2010 and to achieve this; the following will also be investigated:

The relationship between existing accounting infrastructure and accountability in Nigeria.

The control parameters and oversight bodies established by the government and it is effectiveness.

The accountability regulatory framework within Nigeria public sector.

1.3 Research Questions

To what extent is accountability institution working in the Nigerian public sector?

Does professional base of Accountants exist in terms of number and quality that support public expenditure management in Nigeria?

To what extent has Nigeria government lost money due to lack of accountability?

Does public resources managers in Nigeria rendered a timely, adequate and reliable stewardships accounting?

Are the electorate satisfied with the state of public infrastructure and services compared with the amount of resources so far invested in the country?

How effective and efficient is the audit process providing potential for establishing accountability and detection of corruption?

Do competent oversight bodies exist and functioning effectively in the public sector?

Does the accountability arrangement contribute to the availability of information about former and current administrative actions for the administrative body involved and a wider range of administrative bodies?

1.5 Significance of the Study

This study through its findings will help to identify the possible factors attributable to improper accountability in financial management in the Nigerian public sector. It is equally expected that the study will provide relevant suggestions that will improve the stability, effectiveness, efficiency and service delivery of public sector in Nigeria.

The study will be of substantial benefits to accounting practitioners as it will help them improve on their routine work and as regard the effective management of the finances of their respective parastatals. Financial analysts will find this work invaluable as it serves as a basis for advising their clients on investment decisions.

Furthermore, this research work will propel the management of local government councils, state and federal ministries, agencies and departments to formulate policies that will enhance the process of accountability, transparency and probity in their operations. It will also assist various agencies established by the government in fighting corruption within their parastatals. Students will equally find this study as a guide in their future research undertakings on the subject matter.

1.6 Scope and Limitations of the Study

This study examines the fiscal accountability dilemma in Nigeria public sector: a warning model for economic retrogression in Nigeria by prioritizing on selected government parastatals. It will cover the Ministry of Finance, Presidency, Ministry of Works, and National Assembly.

The limitations encountered in the study are time constraint, cost constraint and unwillingness of respondents to provide the necessary data.

The time allotted to carry out this study is relatively short considering other academic engagements of the researcher. Due to paucity of funds, the study"s coverage was limited to only Ministry of Finance, Presidency, Ministry of Works, and National Assembly. Furthermore, the respondents, who are account officers in the selected offices were somehow unwilling to participate in the survey exercise. Nevertheless, a robust and fact-finding research is carried out.

Summary of Finding, Conclusions and Recommendation

5.1 Summary of findings

The study revealed that there is weak accountability in the Nigerian public sector.

It was also found that inadequate record keeping leads to lack of accountability in the public sector due to out of date financial regulatory framework (Finance Control and Management). Act of 1958; Audit Ordinance of 1956)

The professional base of Accountants in terms of number and quality to support management of public expenditure in Nigeria is weak

Lack of accountability in the public sector is due to ineffectiveness of oversight bodies in Nigeria.

The study shows that external auditing is very vital in ensuring effective accountability in theNigerian public sector.

There is high level of corruption, clientelism, and capture in the system because of lack accountability in the public system

The Nigeria Economy is underdeveloped given the level resources and potentials due to financial Indiscipline and wastages in the system resulting from lack of accountability in Nigeria public sector.

5.2 Conclusion

The basic fundamental way for economic development is financial discipline and elimination of wastages of national resources in the public sector which is the direct function of accountability. It is rather unfortunate that the level of accountability experienced in the country is unacceptable due to weak accounting infrastructure, ineffective oversight bodies and the cogs in the wheel of legal framework. The result from this research work shows that there is lack of accountability which has fueled corruption and the whole scenario is termed as a model for economic underdevelopment in the Nigeria. The government is therefore advised to tackle this problem with every resources at their disposal to free our country from this monster that has eaten into the fabric of our economic development.

5.3 Recommendations

In the light of this study, the researcher makes the following recommendations.

Government:

Should ensure that they create enabling environment for the development of professional Accountants and employed them in the civil service. This will be achieved by retaining the existing through motivation and attracting the new with good working conditions.

The problem of ethical and accountability failure in the public sector should be tackled by strengthening the capacity for control institutions through re-orientation programs

A proactive legislature and regulatory framework that should not only exist on paper but must be operational.

The provision of 1999 constitution giving time for submission of financial statement auditing and report, and- review by PAC should be strictly adhered to with punishment spelled out for non-compliance

The constitution should be amended to provide for the qualification of members of PAC.

Professional Accounting Bodies:

The professional bodies should redesign their programmes and carry out more enlightenment campaign activities to attract more Nigerians to the profession.

There should be re orientation of members to encourage them to work in the public sector.

Citizenry:

Another control mechanism is that the citizenry should be motivated by the civil society and organized labour union to be more vibrant in other challenge the actions of the bureaucrats.

• Accounting Project Topics and Materials