Factors Affecting Effective Utilization of Public Budget: A Case of Selected Public Organizations in Hawassa Town Administration, Sidama Regional State

Abstract

This study aimed to examine the determinants of the efficient utilization of public budgets at some public institutions of Hawassa City Administration. With a descriptive and explanatory research design, the study targeted employees working in six public institutions, i.e., in the Plan Preparation Directorate, Finance Administration, and Internal Audit Directorate. A purposive sampling approach was employed for selecting 138 respondents, and census sampling technique was followed. Primary data were collected through a five-point Likert scale questionnaire, and responses were 132 valid ones. Data were analyzed with binary logistic regression (BLR). Spearman correlation analysis revealed that the five independent variables were significant and positively related to effective utilization of the budget at the 99% confidence level, and binary logistic regression confirmed their significance to the utilization of the budget in the sampled organizations. The research concludes that the effectiveness and efficiency of public budget implementation in Hawassa City Administration can be improved by staff competency increment, stakeholder participation, information technology application, finance law and regulation compliance, and audit and monitoring process. The research suggests that public institutions develop enhanced staff training programs while increasing stakeholder engagement in budgets and implement modern information technology solutions while implementing strict finance rule compliance and improved audit and monitoring systems to achieve higher public budget use efficiency.