By Kebba AF Touray
The Dean of the Faculty of Management Sciences at the Nile University of Nigeria, Prof. May Ifeoma Nwoye, has tasked the ECOWAS Parliament to apply a modus operandi that promotes transparency, accountability and participation.
Prof. Nwoye made this call during the ongoing delocalized meeting of the joint committee on Administration and Finance of the ECOWAS Parliament in Abidjan, Côte d’Ivoire, on Wednesday 14th August 2024, while presenting a report on: “Enhancing effectiveness and efficiency of the ECOWAS Parliament: Mediation role of ECOWAS parliament in the community budget formulation and monitoring.”
Prof Nwoye said there is need for the community parliament to regularly track and review budget performance in order to compare actual expenses and revenues with the budgeted amounts on a monthly or quarterly basis. She said this is crucial because budgeting processes are faced with challenges such as delay in budget presentation, which makes it difficult for the parliament to adequately scrutinise and debate before its approval.
“As a consequence for non-compliance with the budget timetable, drafters of the budget eat into the time that is legally reserved for debates,” she said. The budget process, she said, is also challenged by economic volatility, and said instability such as inflation, recession and fluctuating interest rates, can significantly impact budget projections and actual expenditure. She said the COVID-19 pandemic demonstrated how quickly economic conditions can change and disrupt financial planning.
Other factors confronting budget processes, she outlined, include organizational dynamics and the inefficiencies that arise in the misallocation and distribution of resources, and said this has serious implications.
Dilating on the limited financial and human resources, Prof. Nwoye believes that the ECOWAS revenue is susceptible to external factors like economic downturns which affect its revenue and budget implementation.
On globalization as a challenge for budget processes, she explained that operating in multiple countries introduces complexities such as dealing with various currencies, tax regulations and economic environments.
“Exchange rate fluctuations and differing fiscal policies can complicate budget management and forecasting. Keeping up with changing financial regulations and accounting standards necessitates continuous monitoring and adjustments to budgeting processes,” she said.
On external factors that affect budget processes, Prof. Nwoye highlighted that one of such factors is political instability. She explained that political changes and instability in various countries in the region can impact economic conditions and budget planning, saying trade wars, changes in government policies and geopolitical tensions can introduce uncertainties that complicate budget monitoring. She highlighted that the adaptation of new technologies and lack of effective evaluation and auditing, are other external factors that affect budget processes, adding that problems in the budget auditing process can affect budget monitoring and overall financial management. She said in order to address the challenges organizations need to adopt flexible and proactive approaches to budget monitoring.
She further recommended the implementation of effective budget monitoring and control measures and said this is crucial for organizations to ensure that their budgets are accurate and their budget variances are minimized.
