The mismatch between available public resources and the growing demand for tertiary education is a challenge on investment decision processes (IDPs). However, this challenge has also raised concerns about the effectiveness of the traditional budgeting system (TBS) in addressing the problem of disconnect between budget allocations and needs of State owned tertiary institutions. This study, therefore, investigated traditional budgeting system and elements of investment decision processes in state-owned tertiary institutions in South Western Nigeria. Descriptive survey research design was adopted. Multistage sampling procedure was adopted in selecting 448 officials of state ministries, 59 members of state legislative house committees and 773 officials of SOTIs in Oyo, Ogun and Osun states. Two instruments used were: Traditional Budgeting System Scale (r=0.82) and Tertiary Institutions Investment Decision Scale (r=0.74). Data were analysed using descriptive statistics, pearson’s product moment correlational multiple regression. Results showed that, TBS significantly correlated with the component parts of IDPs in sampled SOTIs as follows: decision-making (r=0.534), controlling of programmes (r=0.403), delegated authorities (r=0.309), promotion of future planning (r=0.292), coordination of programmes (r=0.202), monitoring of programmes (r=0.175), efficient use of resources (r=0.167), realistic goals setting (r=0.087) and staff motivation (r=0.013). This shows that, TBS do not impact much on the setting of realistic goals and staff motivation compared to other investment decisions in the SOTIs. There was a significant difference in TBS among the three states (t=14.41, P<0.05); it was more effective in Oyo =( =26.81) followed by Ogun (=24.14) and Osun (=22.91) states. Traditional budgeting system significantly predicted elements of investment decision processes in state-owned higher institutions. In addition, training and retraining of tertiary institutions’ staff involved in budget implementation should be encouraged.
Keywords: Traditional Budgeting System; Elements; Investment Decision; Efficiency; Higher Institutions.
