Traditional views of the budget and budgeting procedures have undergone some recent changes. The previous view of the budget was as an exercise primarily in resource allocation and input control, which was usually highly centralized. This approach to the budget accepted a set of policy objectives—often poorly articulated and usually unquantified—and allocated inputs to reach those objectives. At the same time, central budgeting agencies focused almost exclusively on control and compliance as the primary modus operandi in financial management. There was often little follow-up in examining the subsequent performance of spending departments. The new trend, indicated here as “performance budgeting,” but with different titles in different countries, 1 aims to forge a more direct link between the allocation of resources through the budget and performance in reaching objectives. This reorientation has necessitated a number of changes in traditional budgeting. Most noticeably, there has been a greater emphasis on measures of performance. Indeed, the basis of recent efforts to improve the management of government services has focused on developing measures of output and on assessing productivity in government.

Issues and Country Studies
Editor: A. Premchand