Question 2 (b)
Programme budgeting and performance budgeting distinguished
6 marks
- Time to write
- About 12 minutes
Question
Question 2 (b) · 6 marksDifference between Programme budgeting and Performance Budgeting?
Reworded from the university paper; the task is the same. The original paper belongs to the University of Delhi. See DU's question bank.
Before you write
Read off the question and its marks
Read from the question
- Difference betweenSet the differences out in a table, basis by basis, not as two separate essays.
Write it in this order
- Read; underline the asks; jot your points 1 min
- 1 Programme budgeting 2 marks 3 min
- 2 Performance budgeting 2 marks 3 min
- 3 Differences 2 marks 3 min
- Check: every ask answered, key terms underlined 2 min
Short on time? Trim steps 1–3 evenly rather than skip one: each is capped at its own marks.
Try it first. About 12 minutes for 6 marks. Write it out, then open the solution.
Solution
Hover or tap a marked figure, like 72,000, to see how it is made and where else it appears.
Programme budgeting (associated with the planning-programming-budgeting system) arranges the budget by programmes, groups of activities aimed at a common objective, rather than by departments or items of expense. It sets out the objectives, the alternative programmes for achieving them, their costs and benefits over several years, and allocates funds to the programmes that best meet the objectives. Example: a state government budgets for a programme of reducing infant mortality, covering health centres, nutrition and vaccination, wherever the costs fall.
Performance budgeting relates budgeted expenditure to the physical output or results to be achieved. For each activity it states the funds required and the measurable performance expected, units of work, services delivered, targets, so that actual performance can be compared with the money spent. Example: a municipal body budgets ₹2 crore for road repair to resurface 50 km of road, and reports the kilometres actually resurfaced.
| Basis | Programme budgeting | Performance budgeting |
|---|---|---|
| Focus | Objectives and programmes to achieve them | Work done and results achieved for the money spent |
| Main question | Which programmes should be undertaken? | How efficiently is each activity performed? |
| Time span | Multi-year, long-term planning | Usually annual |
| Level | Planning and allocation at top level | Control and measurement at operating level |
| Basis of classification | Programmes, across departments | Functions, activities and projects |
| Emphasis | Choice between alternatives (effectiveness) | Measurement of output (efficiency) |
Illustration of the difference
A state education department using programme budgeting would ask whether funds should go to building new schools, to teacher training or to a mid-day meal scheme in order to raise enrolment, and would compare their costs and expected results over several years. Using performance budgeting, it would state, for the chosen scheme, the money to be spent and the number of meals to be served or teachers to be trained in the year, and then report what was actually achieved.
Both shift budgeting from inputs to outcomes, and they are often used together: programmes are chosen by programme budgeting, and their execution is monitored by performance budgeting.
Where the 6 marks sit
| # | Component | Marks |
|---|---|---|
| 1 | Programme budgeting | 2 |
| 2 | Performance budgeting | 2 |
| 3 | Differences | 2 |
| Total | 6 |
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