Archive for the ‘Performance Budgeting & Management’ Category

Program Budgeting: the Role of Management Programs

Monday, September 27th, 2010

What is the role, and appropriate scope, of “management” programs – that is, programs which group together ministry support services such as HR, IT and finance/accounting? There is wide agreement that management programs can be justified on the pragmatic ground that they avoid the need to allocate support service expenditure to output-based programs. (more…)

Program budgeting: Program vs. Organizational Structure?

Monday, September 6th, 2010

One of the thorniest problems for program budgeting is the relationship between programs and organizational structure. If ministries have major organizational units which straddle several programs, significant practical problems arise in linking organizational unit budgets and program budgets. It becomes necessary to allocate organizational unit expenditure between programs, both in budget preparation and in financial reporting. Such expenditure allocation is a challenging task in any country. In practical terms, however, it is beyond the capacity of many developing countries. For these reasons, strong pressures arise to force programs to conform to organizational structure, thereby by-passing the problem. (more…)

Outcome Measurement: the Central Role of Surveys

Saturday, August 14th, 2010

My last piece discussed the great progress which has been made in outcome measurement over recent decades. This has been hugely important in providing a better information base for performance management and budgeting. Perhaps the most important single methodological development in this area has been the increased use of surveys. (more…)

Outcome Measurement: Great Progress Made in Recent Decades

Friday, July 30th, 2010

Performance budgeting and management are, according to many of their critics, guilty of an “emphasis on unmeasurable outcomes” *.  The critics claim that most government outcomes are either impossible or extremely difficult to measure. They see this as the Achilles’ heel of results-oriented management. This overlooks the great progress in outcome measurement has been made by governments around the world in recent decades. (more…)

Program Budgeting – Keep it Simple

Friday, June 18th, 2010

Developing countries should, given their limited resources and capacity constraints, keep their performance budgeting systems simple.  It is a remarkable fact, however, that they frequently seek to implement systems considerably more complicated than most of the performance budgeting models one sees in developed countries. One of many areas where this is true is the design of program structures. (more…)

Balanced Scorecard: Wrong for Government

Wednesday, May 19th, 2010

The balanced scorecard (BSC) has been marketed aggressively to governments as a framework for public sector performance measurement. But the BSC is not, and never was, an appropriate performance measurement framework for government. (more…)

Major New Performance Budgeting Training Initiative

Tuesday, May 4th, 2010

The World Bank has launched a major new initiative to establish systematic in-depth training in performance budgeting, together with associated technical assistance and other services. The CLEAR initiative of the Bank’s Independent Evaluation Group (IEG) is in the process of establishing four regional centers around the world which will offer both generalist and specialist courses in performance budgeting. (more…)

Private Sector Performance Management Models Wrong for Public Sector

Friday, April 9th, 2010

Strategic planning for businesses must necessarily be customer-focused, because winning and retaining customers is the key to business financial success. Government organizations are sometimes told that their strategic planning should be just as customer-focused. Concretely, they are told that identifying clearly who their customers are should be a first step in strategic planning, and that the primary focus of planning should be on how they can meet customer needs. This is bad advice. (more…)

Targets don’t define Programs

Friday, March 26th, 2010

The standard – and correct – approach to defining programs is by specifying the program objective and linking this to the type of service which the program provides. Thus a health treatment program might be defined by objectives of “minimizing death and disability via appropriate treatment of disease and injury”.  I have recently seen a quite different approach at work in two countries, where programs are supposed to be defined instead in terms of performance targets. (more…)

Unit Costs in Performance Budgeting

Wednesday, March 24th, 2010

It is often suggested that unit costs are the basic tool for performance budgeting. The proposition is that measuring the unit cost of public sector services (outputs) – or, according to some, activities – provides the best instrument for linking the funding provided to ministries to the results they are expected to achieve. In other words, unit costs are supposed to be used in budget preparation to calculate budget requirements as a function of the quantity of services to be delivered to the public. Monitoring budget execution then allegedly becomes as easy as seeing whether the planned quantities of outputs were actually delivered. This exaggerated notion of the role of unit costs as the link between funding and performance is surprisingly widespread. (more…)