OGECHI AGBAI, week 5 assignment help

THIS IS ONLY AN INTERPRETATION, FIVE SENTENCES AND A QUESTION IS ALL I NEED. TELL ME YOUR THOUGHTS, HAVE REFERENCES

Balanced
budget which means a budget in which revenues are equal to expenditures
(Mikesell, 2014). Thus, neither a budget deficit nor a budget surplus
exists as the accounts balance. I stand for a balanced budget in a state
or nation as this helps keep government expenditure in check and
accountable. This fosters economic stability in a system and encourages
the government and its agencies to be proactive in generating revenue
for the state or nation, manage and limit unbudgeted spending and
borrowing. Where a government intends to increase its spending, it has
to source for avenues to increase and boost its revenue internally.

Where
a balanced budget is not practised, the government borrows excessively
from international community and plunge the country (Nigeria) into debt
lasting more than 20 years to redeem. However, where a balanced budget
is practised high priority areas are identified and revenue allocated to
those priorities (Mucha, 2012). The government is stopped from
overspending, looting is reduced as there will not even be enough to
meet up with the priorities, and projects will be within the budget for
that financial year. Although there are also recurrent deficits in a
financial year, provision of the deficits will be considered within the
budget. The essence is to control unnecessary national spending which
leads to debt – increase in debt equals high taxes to citizens, high
interest, lack of bargaining power, and high inflation rate which
Nigeria suffers now.

In
Nigeria presently I am of the view that expenditure should be reduced
in other to accommodate her recurrent deficits of previous years. If
this has been practiced over time Nigeria would have had reserves for
essential expenditures, not be indebted to international nations and not
plunge further into recession which has crippled the economy. To cut
spending, the culture of unbudgeted expenditure has to gradually change,
the government has to look inwards and reduce its spending by removing
unnecessary recurrent of office equipments, yearly furnishing of same
legislative apartments and offices in the budget.

The
gains to a balanced budget are controlled expenditures, efforts
channeled to increase in revenue, reduction in debt accumulation while
losses may be that during emergency situations such as natural disasters
or war etc., a government may not have available accessible funds to
fully meet up with the needs of her citizens. Although, concerned
private organisations, non profit organisations, and the international
community may lend a helping hand in situations as this when they arise.

References:

Mikesell,
J. L. (2014). Fiscal administration: Analysis and applications for the
public sector (9th ed.). Boston, MA: Wadsworth.

Mucha, M. J. (2012). Budgeting for Outcomes: Key Findings from GFOA Research. Government Finance Officers Association