CHAPTER ONE

GENERAL INTRODUCTION

1.1.1 Background to the study.

This concept of budget is basically state budget, state budget being government budget. A Government budget is a document prepared by the government or other political entities presenting it anticipated revenues and proposed spending for the coming financial year.  In most parliamentary systems, the budget is presented to the lower house of the parliament. Through this budget, the government implements economic policy and realizes its priorities.

Once the budget is approved, the use of funds from individual chapters is in the hands of government ministries and other institutions. The state budget is generally studied under public finance. Public finance has always been considered as the back bone of the republic since they are absolutely necessary for the proper functioning of any state.

No state can have effective political and economic sovereignty without necessary financial resources.   By this definition, we can understand that public finance deals with income and expenditure of government entities at any level be it central, state or local level. According to Prof. Dalton in his book The Principle of Public Finance, the scope of public finance is categorized as follows;

1. a) Public revenue. The study of various sources of government income, the principle guiding the raising of income (e.g. tax) their relative merits and demerits and their effect on the economy (e.g. impact and incidence of taxation. b) Public expenditure. The study of the manner in which public expenditure is classified, the principle guiding public expenditure.
2. c) Public debts. The study of public debts from a very important part of public finance in modern times as governments are increasingly resorting to debt to meet in the growing need of the people. Public finance studies the sources, burden and impact of public debt. A. Historic development of public finance. Two great moment characterize the evolution of public finance; the period of classical public finance and that of modern public finance The classical public finance.

The classical public finance existed in the era of the liberal state [non-interventionist] their main aim was limited to the achievement of it sovereign function such as, justice, security, defense and diplomacy. This type of public finance was characterized by;

1. the small volume budget. This is because tax was the only budgetary resource.
2. The budget neutrality. The liberal state did not use it budget to intervene in the economy.

The dogma of balance budget or budget equilibrium. The liberal state believed that a person should not spend more than he\she earns. According to them budget should be voted in balance between revenue and expenditure.

Following the world wars and the economic crisis, the liberal state or the watch dog was abandoned in favor of welfare state or interventionist                                                                                                                                                            2. Modern Public Finance.

This is a period of state interventionism, the state mission was expanded that is in addition to the sovereign function, economic and social missions where added. The modern public finance has the following characteristic;

i.The increase in volume of state budget. Taxation is no longer the only budgetary resource. Other non-fiscal resources are now added.

ii.The state budget is no longer neutral. The modern public finance is an instrument of economic and social policy.

iii.The budget equilibrium or balance is no longer a dogma due to state intervention. Thus, to tackle the economic unstable and social situation, several unbalance theories have emerged that is, the theory of cyclical budget, theory of budget impose and the theory of deficit.

1. Introduction of the programme budget in Cameroon’s public finance.

The fiscal year 2013 marks the full effectiveness of law NO 2007/006 of 26 Nov 2007 relating to the Fiscal Regime of the state. This law alights our country to a new approach to public management through programme budget. As a public finance tool, programme budgeting consist in preparing, presenting and implement finance law based on programmes.

In this method, ministers set medium-term goals and define the result they hope to achieve, accompanied by indicators for measuring these results afterwards. This is therefore a strategic management tool use in scheduling, planning and adjusting public action. According to this new financial regime, government department and public institutions have to “do better with less”.

In Cameroon, the statutory definition of budget is provided by section 4(1) and 23 of law No. 2018/012 July 2018 relating to the financial regime of the state and other public entities. As per section 4(1) “the budget shall outline state revenue and expenditure authorized under the finance law, in terms of revenue and expenditure with a context of financial year” Section 23 provides that “ the state budget shall determine for a financial year, the nature, amount and assignment of revenue and expenditure as well as the resulting budgetary balance and the terms and condition for it finance. It shall be adopted into the finance law”. The financial year in Cameroon correspond with the calendar year since 2003.

1. Programme Budget And Resource Based Budget

The limitation of budgetary commitment for the year is replaced by a multi-annual programming. A programme may be extended for three years even if it’s available annually. Until 2012, the state was given public administration resources according to their need. That’s why it’s called resource-based budget and the programme budget is call result-based budget. The difference lies in the purpose of expenditure; a manager was assessed of the regularity of expenditure whether he has solved a problem or not whereas now the same manager is evaluated on the result archived with the resources received.

Moreover, this pre-supposes that public funds went to the right place. The programme budget has been used in many countries for many years it is the case of six African countries which are; South Africa, Mali, Tunisia, Mauritius, Morocco and Gabon. Outside Africa the country include USA, FRANCE, NEWZEELAND etc. have put in place a system of programme budget more4 than two decades ago.

1.1.2. Statement of The Problem   

The legislative (parliament) as well as the executive are both organs or arms of the government. The involvement of the Parliament (legislation) in budget process is considered to be essential. The Executive also plays an important role when it comes to budgetary matter. In order to determine the level of involvement of both arms, the role of the arms posts a problem to be look into during this research.

1.3. Research Questions.

1.3.1 Main Question

What are the Executive and Legislative arm of government?

1.3.2 Secondary Question

1. What roles does the Executive play in budgetary matters in Cameroon?
2. What are the roles of the Legislative (Parliament) in budgetary matters?
3. What is the restriction of budgetary powers of the parliament over the state budget, and the exclusive jurisdiction of the executive over budgetary issues?

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