Understanding the Interplay between Implementation Practices and Staff Competence in Driving Budget Absorption and Performance Outcomes within Higher Education Institutions

This study aims to analyze the relationship between budget implementation practices and human resource competencies in driving budget absorption and performance achievement in higher education institutions. Low budget absorption and the imbalance between financial realization and performance remain structural problems that impact the effectiveness of public financial management in the higher education sector. This study uses a quantitative approach with a survey method of budget management officials and financial administration staff at state universities. Data were analyzed using structural equation modeling to examine the direct and indirect effects of implementation practices and staff competencies on budget absorption and organizational performance. The results show that effective budget implementation practices have a significant effect on increasing budget absorption and institutional performance. Furthermore, staff competency has been shown to strengthen the relationship between implementation practices and performance achievement, both directly and as a mediating variable. These findings confirm that the synergy between an adaptive implementation system and adequate human resource capacity is a key factor in improving budget management effectiveness and the performance of higher education institutions.