Trends in budgetary expenditure on the agricultural sector in Nigeria (1977-2004)

The study estimated trend equations for budgetary expenditure on Nigeria agricultural sector between 1977 and 2004. Secondary data in the form of budgetary expenditure records were obtained from various publications of Central Bank of Nigeria (CBN) and Federal of Statistics (FOS). Results from the fitted trend equations showed that budgetary expenditures on agriculture were generally low and insignificant (p>0.05). Annual compound growth rate of expenditure on the sector was also low (1.02%) and fluctuating for the entire period under review. Furthermore, the fitted quadratic equations in time variable showed the absence of either significant acceleration or deceleration in expenditure growth on agriculture. This, therefore, confirms that expenditure growth on agriculture had been stagnant, suggesting a case of financial neglect of the sector. Based on these findings, the study recommends deliberate efforts by Government to increase funds to agriculture in order to boost self-sufficiency in food production and reduce poverty in Nigeria.


INTRODUCTION
Government pronouncements over the years have indicated that the agricultural sector occupies a priority position in national development programmes. In fact, the large number of agricultural institutions such as the Agricultural Development Projects, River Basin Development Authorities, Agricultural Development Banks and others, as well as the series of government campaigns and slogans directed at the sector in recent years may be cited as evidence of government's concern for the development of the sector. Despite the institutions, campaigns and slogans, farm production has failed to keep pace with food demands (Obadan, 1998;NISER, 2003). Apart from the commonly stated problems of poor input distribution, inefficient marketing, low level of farm technology and poorly coordinated extension systems, there is the need to also consider the magnitude of funds actually spent on agricultural programmes. The successive development plans of countries find expression in the annual budgets, which make financial provisions for public investments in enterprise and infrastructure. Thus, the budget speech at the beginning of each year attracts considerable political attention particularly in developing countries where peoples' expectations rise spontaneously based on new allocations *Corresponding author. E-mail: torjape4sucess@yahoo.com Author(s) agree that this article remain permanently open access under the terms of the Creative Commons Attribution License 4.0 International License in the budget for improving their living standards within the short run (Ayoola and Oboh, 2000).
However, the annual budget as a policy instrument for implementing poverty reduction programmes in the plan has been criticized frequently as biased against agriculture in preference to other sectors of the Nigerian economy (Oboh, 2001). This criticism reflects in the popular explanation of the poor performance of developing economies in terms of a chronic "neglect" of the agricultural sector. It is expected that the current rising revenues derived from petroleum should be invested largely in agriculture and agro-industrial development in increasing both the productive and absorptive capacity of the sector.
Inspite of the re-echoing of the problems of inadequate funding of agriculture by several experts, an in-depth and long-term trend analysis of expenditure on the agricultural sector was yet to be carried out. This study is, therefore, designed to estimate trend equations for the actual budgetary expenditure on the agricultural sector in Nigeria between 1977 and 2004.

Method of data analysis
Annual compound growth rates of budgetary expenditure on the agricultural sector were computed by fitting exponential equations in time variables to the data as follows: Which when linearised in logarithms becomes Where Q is budgetary expenditure on the agricultural sector, t is the time trend variable and 'a' and 'b' are the regression parameters to be estimated. The annual compound growth rate (r) in budgetary expenditure on the agricultural sector is given as Where e is Euler's exponential constant (2.71828). The estimating Equation (2)  In order to confirm the existence of acceleration or deceleration or stagnation in budgetary expenditures, quadratic equations in time variables are fitted to the data for the three periods as follows: Log Q = a + bt +ct 2 According to the above specification, the linear and quadratic time terms define the secular path in the dependent variables (Q), while the quadratic time term (t 2 ) allows for the possibility of acceleration or deceleration or stagnation in growth during the period of study (Sawant, 1981;Onyenweaku, 2004;Onyenweaku and Okoye, 2005). Significant positive value of the coefficient of t 2 confirms significant acceleration in growth, significant negative value of t 2 confirms significant deceleration in growth while non-significance of the coefficient of t 2 implies stagnation or absence of either acceleration or deceleration in the growth process.

Estimated trend equations
The estimated trend equations for budgetary expenditure on the agricultural sector are presented in Table 1 for the three periods under review. The coefficient of the time trend (b) is positive and statistically non-significant across the three periods. This implies that government budgetary expenditure on agriculture remained the same (low and insignificant) during the pre-reform period, reform period as well as the entire period. Table 2 showed the computed annual compound growth rate of budgetary expenditure on agriculture across the three periods. During the pre-reform period, expenditure grew at a compound rate of 12.16% per annum, declined to 0.13% during the reform period while it grew at a rate of 1.02% for the entire period. The decline in expenditure growth rate during the reform period means that the structural adjustment efforts of government did not translate into any improvement in expenditure growth on the agricultural sector (CBN/NISER, 1992).

Estimated quadratic equations
The estimated quadratic equations in time variable for budgetary expenditure on Nigerian agriculture is shown in Table 3. The coefficient of t 2 for the three periods (prereform. reform and the entire period) were statistically insignificant. This result confirms the absence of any significant acceleration or deceleration in the growth of budgetary expenditure on Nigerian agriculture. In other words, expenditure on agriculture for the periods under review has been stagnant. This suggests that the agricultural sector has been consistently neglected in terms of funding as observed by Imoudu (2005). This stagnation in the annual growth of expenditure on agriculture betrays credibility gap between the usually stated priority status accorded agriculture and the   willingness of government to release adequate funds to develop the sector. The implication is that, new projects and programmes may suffer implementation since there is no significant increase in expenditure on agriculture.

Conclusion
The results of this study have confirmed stagnation in budgetary expenditure on the agricultural sector. This is an evidence of lack of financial commitment to the agricultural sector, which is the mainstay of Nigerian economy. From the foregoing, agriculture appeared marginalized as exemplified by the non-significant budgetary expenditure on the sector before and during the reform periods. There is, therefore, the need for Government to deliberately increase the funding of the agricultural sector. This may help to implement new projects and programmes aiming at boosting food selfsufficiency and reducing poverty in Nigeria.