Budgetary Compliance On Expenditure Absorption In The County Government Of Kericho, Kenya

ABSTRACT

.The Kenyan Constitution provides broad principles of public finance whereas rules are sets out by the Public Finance management of how the national government can raise and spend money. Despite the existence of a budget calendar with a widely consultative, extensive and highly participatory budgeting process carried out every fiscal year by State Corporations in Kenya in order to have minimal budget / actual variances, there is agreement that the performance of county budgets in Kenya is still weak, especially in the areas of product offering, service delivery and efficiency. The main objective of this study was to analyse budgetary compliance on expenditure absorption in the County government of Kericho, Kenya. The specific objectives were; to examine the impact of County expenditure approval process on absorption of funds, to establish public participation challenges encountered in public expenditure, to determine how expenditure ceilings affect absorption of funds and to analyse financial reporting requirements and effects on absorption of funds allocated to the County Government of Kericho. The study was anchored on the theory of budgeting, innovation diffusion theory, public choice and public budget efficiency theory, and the institutional theory. This study adopted descriptive survey design and used questionnaires to collect data. The questionnaires were semi-structured and they were used as they were easy to administer. Drop-and-pick later technique of distribution was used to administer the research instrument. The validity of the research instruments was established by pre-testing the questionnaire and also by seeking options of experts in the field of study. Cronbach’s alpha was used to test the reliability of the research instrument. The collected data was coded and tabulated for easy analysis. Data was analysed by use of descriptive statistics like mean, mode and median. The study also used inferential statistics that is regression analysis. The findings were presented in frequency distribution tables, charts and bar graphs. The instrument for data analysis was Statistical package for the social sciences (version 24) computer software. The study found that to a great extent that public participation challenges affect expenditure absorption. The research found that to a great extent that communication affect expenditure absorption in Kericho. Further the study found out that public submissions are minimal because nearly all the views of the citizens are not captured in. The research found that that county expenditure approval process contributes the most to expenditure absorption in the County government of Kericho, Kenya, followed by public participation challenges. At 5% level of significance and 95% level of confidence, county expenditure approval process, public participation challenges, expenditure ceilings, and financial reporting requirements were all significant on expenditure absorption in the County government of Kericho, Kenya. The study concluded that public submissions is minimal because nearly all the views of the citizens are not captured in. In addition, there is prioritization of the projects because the citizens will push their leaders to facilitate the implementation of the projects. In relation to the public oversight the study concluded that not many citizens are aware of the oversight mechanism and they had to blame the executive in oversight instead of the MCAs. With the findings and conclusions made in this study, the researcher therefore recommends for policy implementations that; In general, fiscal stimulus plays an important role in the county's economic growth and development, especially if the county's monetary policy is restrictive and does not enable companies to establish better economic conditions in order to increase their productivity.