Implementing Performance-Based Program Budgeting: A System-Dynamics Perspective

The article proposes a model for evaluating budget reforms that combines insights from budgeting, policy implementation, and system-dynamics literatures. System-dynamics modeling combines both quantitative and qualitative research techniques to provide a new framework for applied research; its use is illustrated using performance budgeting as an example. Applied to the implementation of Florida's performance-based program budget, the model identifies actions in the short run that will increase the reform's likelihood of success: providing clear communications; facilitative budget and accounting routines; reliable performance information. The model also identifies critical legislative behaviors that influence executive implementation: how the legislature in the long-run uses performance information to inform resource allocation and how it applies incentives or sanctions to programs that achieve or fail to achieve their performance standards. The legislature has the opportunity to use program reviews prepared by legislative staff to invigorate the executive branch's resolve to continue implementing the reform.     

Issues in Program Budgeting

Funding arrangements for human service programs are often complex, particularly when intergovernmental financing is involved. There are two financial arrangements used by human services administrators to assure that money budgeted is spent as intended. Reallocation of unspent funds among jurisdictions and carryover to the following year of unspent balances are examined in this article based on examples drawn from two programs in Minnesota.     

Budgeting Rules and Program Outcomes

It is not efficient for a budget system either to enable excessively frequent changes in programs and tax policies or to be rigid and unresponsive. Program durability is one measure of how a budget system weighs the competing goals of resoluteness and responsiveness. The federal budget has different processes—mandatory and discretionary spending and tax expenditures—each based in separate congressional committees and relying on separate procedures. This article examines the budget systems' durability. One finding is that mandatory spending programs and tax expenditures are more durable than programs backed by discretionary spending. However, while programs targeted to vulnerable populations and supporting long‐term planning, such as in income support and health, might benefit from durability, these programs display shorter durability, not longer. While displaying greater durability, tax expenditures do respond to changes in different economic sectors, based on the changes in spending of other budget systems.     

Program Budgeting and Accountability in Local Government

Much has been written about program budgeting and its relevance to improved efficiency and effectiveness. However, there is little discussion about the relationship between the use of program budgeting and accountability. While, organisations using program budgeting focus on the issues of performance, the accountability of management to an elected body, such as a local council has been given little attention. In this article three questions are posed: (1) Is the performance information available to enable councillors to form a judgment about management's performance?; (2) Is management involved in determining issues of policy, such as objectives, programs and performance measurement?; and (3) Are councillors confronted by a greater volume of budgetary documentation but with no increase in time to consider it? The results show that program budgeting does not always enhance accountability in local government.     

An Analysis of Introducing Program Budgeting in Local Government

Program budgeting has been in use for 30 years. It has had a checkered history, being considered alternately a great advancement or an unworkable system. Little has been written about the consequences for the organization that has adopted it. This study was undertaken concerning local government across the State of Victoria, Australia. A questionnaire was sent to all municipalities. There was a 60 percent response rate. Results show that information generated by planning programming budgeting (PPB) is used for decision making but in a limited way. The proposition that PPB will have an impact on the operations of councils is only partially supported.     

Implementing the GPRA: Examining the Prospects for Performance Budgeting in the Federal Government

The Government Performance and Results Act (GPRA) is the latest in a series of attempts to introduce performance-based management and budgeting techniques at the federal level in the United States. In the past, these attempts largely failed due to administrative complexities, lack of investment in managerial, accounting, and information systems, and the absence of institutional incentives to promote gains in economic efficiency. Whereas we find the objectives of the GPRA laudable, we question whether this current incarnation of performance budgeting can succeed in transforming the traditional focus of federal budgeting from annual appropriations and obligations to multiyear outputs and outcomes.     

Performance‐Based Budgeting: The Contribution of the Program Assessment Rating Tool

Under the President's Management Agenda for performance and budget integration, the Office of Management and Budget (OMB) designed the Program Assessment Rating Tool (PART) to breath new life into performance‐based budgeting as envisioned by the Government Performance and Results Act (GPRA). This article discusses what PART is designed to do and how the PART process works. Based on recent Government Accountability Office (GAO) reports addressing implementation of PART in the last four fiscal years, the article answers such questions as: Has PART made a difference in program operations? What is the relationship between PART and GPRA? Has progress been made in improving the evidence base for PART assessments? How well does PART assess programs related to a common goal? What has been congressional reaction to the PART process? Are PART and performance budgeting making a difference in government?     

The Use of Program Analysis in State Budgeting: Changes between 1990 and 1995

Reform literature has long championed the notion that program analysis should be utilized in budgetary decision making. This article reveals that, although the 1990s may have shown renewed interest in this line of reform nationally, a noticeable decline seems to have occurred in the conduct and use of program analysis by states. The article examines other changes in the period from 1990 to 1995, compares different executive-branch units with one another in their involvement with program analysis, and considers possible relationships between executive and legislative use of analysis Few linkages are found between the characteristics of states and their use of program analysis. The article concludes with a discussion of possible explanations for the changes between 1990 and 1995 and the implications of those changes.     

The Use of Administrative Discretion in Implementing the State Children's Health Insurance Program

States have exercised administrative discretion in at leastsix different ways during the intergovernmental implementationof the State Children's Health Insurance Program (CHIP) provisionof the Balanced Budget Act of 1997. States have used this flexibilityto determine when to submit their plans and when to put theCHIP program into effect. After describing the problem of uninsuredchildren in America and the politics of program adoption, multivariateanalysis is used to attempt to answer the following question:Why have some states moved more quickly than others to get plansfor introducing CHIP submitted, approved, and implemented? Thenature and extent of a relationship between a state's economic,political, and health-need characteristics, on the one hand,and the timing of submission and implementation, on the other,are examined.     

Budgeting for Accountability: Municipal Budgeting for the 1990s

The emphasis of a public budget depends on the time and circumstances in which it is developed. During the 1990s, for example, the emphasis has increasingly been on accountability due to widespread public belief in recent years that government is uncontrollable and responds only to special interests. Over the past few years, local budgeters have begun to adapt to this new environment by improving the accountability of the budget to the public. This article summarizes some of the changes taking place and suggests some additional changes that could be adopted to make local budgeting more accountable.     

Biennial Budgeting in the Federal Government

This article examines the possible outcomes of changing from the current annual budget review to biennial budgeting. It looks at the experience of various states and its application to the federal level. It explores all of the supposed benefits , including less time spent on budgeting issues, more accurate budget projections, reduction of congressional workload and increased congressional oversight and, for the president's point of view, increased power of the executive branch. Concluding on a cautious note, the article offers some plausible applications of biennial budgeting to the national budget.     

Budgeting during the Clinton Presidency

This article assesses the Clinton administration record of budgeting. During President Clinton's two terms, the federal government moved from an era of large deficits to one of equally large surpluses. This turnaround was caused by both the strong economy and the deficit reduction deals of 1990, 1993, and 1997. Defense spending and interest declined as a percentage of the budget, whereas mandatory spending and nondefense discretionary spending increased. Acrimonious interbranch budgetary relationships dominated, with Clinton ultimately winning far more fights than he lost. Executive branch budgetary and financial management capacity improved during the Clinton administration.