Performance Budgeting :: American Government, Budgeting Initiatives

This paper examines the benefit of execution of instrument based cyphering as a practical theory of efficiency for governing programming. Confronted by fiscal limitation and demand for improved public services, establishment agencies are utilizing the budget as a means to elevate government accountability and efficiency, rather than simply as a means for distributing gold and controlling expenses.Performance based budgeting has been defined as a trunk wherein managers are provided with the flexibility to utilize agency resources as required, in sound reflection for their commitment to achieve certain performance results. (Brewer, 3) Performance budgeting is a placement of planning, budgeting, and evaluation that emphasizes the relationship between money budgeted and results expected. (Government of Alberta, 1) Performance budgeting signifies an important deflection from habitual line item budgeting. A line item budget is mainly a tool for controlling expenditures it ch aracteristically indicates the amount of outlay permitted for particular purposes. As a fiscal year progresses, departmental spend must remain within the budgeted amounts unless formal budget amendments are approved. nether line item budgeting spending in one category rumpnot automatically be used to supplement another category. (Government of Alberta, 2)While traditional budgets can be useful in assisting managers with internal control, they are not typically as useful as a policy or close making tool. Line-item budgets assure elected and administrative officials that money is existence dog-tired only for approved purposes, but they do not show what is being accomplished with the money. (Government of Alberta, 3) Additional drawbacks to line-item budgets involve the promotion of indolence, due to the minor modifications do to budget planning each year. Line-item budgeting can result in futile and costly actions because management is not allowed the flexibility to addre ss changing situations. (Virginia guild of Certified Public Accountants, 7) Many government programs are often agonistic to use funding, or lose funding at the end of a program year these restrictive processes have the potential to invite micromanagement and baffle the fulfillment of program objectives. (Government of Alberta, 3) In comparison, performance budgeting has more of a policymaking taste it links plans, measures, and budgets and it pushes administrators and policymakers to contemplate the big picture. (Brewer, 23) Performance budgeting provides useful information around the impact of budget decisions on people and gives departments increased budgetary flexibility. Additionally, performance budgeting allows for ongoing monitoring and strengthens legislative decision making and oversight.