From Program to Performance Budgeting

Many emerging market economies are trying to improve their budget processes and move to performance-based budgeting. This paper first reviews the evolution of the "new" performance budgeting model, increasingly being applied in industrial countries. By identifying its main components, the tasks faced by emerging market economies when converting their present budget systems to this model are determined. It is recognized that this conversion will not be easy and will require four major reform elements. First, any existing program structure must be set in the wider context of strategic budget planning and medium-term budget frameworks. Second, this typically involves redesigning and refining existing program structures. Third, existing budget-costing systems and associated skills will probably need to be improved. Fourth, and perhaps most difficult, a new system of accountability and budget incentives needs to be introduced. For emerging market economies, these should be viewed as the prerequisites for a successful introduction of the new performance-budgeting model.Emerging markets;Accounting;performance budgeting, budget management, budget process, accrual accounting, output budgeting, budgetary process, government agencies, organizational structure, budget format, performance budget, budget planning, medium-term budget, performance budgeting approach, budget reform, budget decision, government expenditures, government budgeting, federal government, administrative systems, budget framework, budget expenditures, budget allocations, government performance, budget systems, central budget, service delivery, budget managers, budget system, budget review process, budget discipline, budget agencies, administrative procedures, budgetary performance, budget formulation, budget program format, budgetary impact, annual budgeting, budget agency, budget policy, budgetary systems, government service, managerial autonomy, budgetary decision making, public finance, expenditure management, budget requests, government accounting, budget review, management systems, budget structure, cash accounting, budget formats, budgetary decision, resource allocations, administrative structure, budget plans, performance ? budgeting approach, ministry of finance, government finance, budget office, public administration, government expenditure, budget reforms, agency outputs, budget negotiations, administrative support, accountability mechanisms