Abstract:
The study was conducted on the role of budgeting as a management tool for effective performance of public institutions in Rwanda using a case study of the University of Rwanda. The specific objectives of the study were to identify the purpose of Budgeting at University of Rwanda, assess the effectiveness of the budgeting process at University of Rwanda, to establish the contribution of budgeting to the performance of University of Rwanda and find out the problems encountered in the budgeting process at University of Rwanda. The sample size was 60 people who included staff who have direct involvement in the budgeting process at the University of Rwanda. However, only 49 were able to provide data because 11 out of the selected 60 lost the research instruments administered to them. Purposive sampling was used to identify and select these respondents. Primary data was collected by us of questionnaires, interview guides while secondary data was gathered by review of secondary data sources like reports, journals, articles, etc.
Study findings show (91.8%), that the purpose of budgeting at University of Rwanda is to enable effective resource allocation and also to encourage transparency in resource utilization.
In regard to budgeting effectiveness, the study established that (95.9%) University of Rwanda’s budgeting is always strategically planned to fit into long term goals, follows a formal budgeting cycle, that is, identification of priorities, planning, formulation, implementation, monitoring and evaluation and budgeting is always based on the available cash revenues and government rules and regulations are respected.
It was also found that budgeting has greatly contributed to performance of the university. For example it ensure that staffs offer quality services (81.7%), facilitated an improvement in academic research and innovation at the university (69.3%), helped to equip UR with scholarly resources (95.9%), it increased scholarly publications (42.9%).
A positive Pearson correlation value of 0.827 with the level of significance (P=0.01) showed that there is a relationship between budgeting process and performance at the University of Rwanda. Problems affecting budgeting process at the University of Rwanda were also identified. It was established that (79.6%) University of Rwanda budgets were based on assumptions and guesswork. Lastly, findings show (77.5%) that some budgeting team members at UR lacked financial management skills.
