Budget Vs Zero-Based Budgeting

Planning programming and budgeting, zero-based budgeting and target-based budgeting are variations of performance budgeting. These formats are projected to improve the policy decision-making situation and rational analysis. Budget officials would focus on the major policy instead of insignificant and time-consuming issues using these formats. The development PPB experienced some success and failure. It is an attempt for government to institutionalize analysis into the public budgeting process. However, it is not equal to a formal analysis. (p.95). “PPB does encourage the application of marginal utility analysis, cost-benefit studies, cost-effectiveness analysis, sensitivity analysis, pay-off matrix, present values, and other techniques in

In addition, some programs using ZBB is difficult to control its appropriations such as “veterans’ benefits, social security, interest payments on the national debt, retirement payments to federal workers, and food stamps” (p.100). Furthermore, ZBB cannot judge priorities between different programs. In contrast, target-based budgeting is a format that higher-level managers set the priorities and limits to the bottom officials. Compared with ZBB, departments use TBB have less time-consuming analysis and more autonomy by deciding priorities and projects if these are within the target allocations which is set by the central government. The City of Charlotte, North Carolina uses a balanced scorecard and TBB approach. The budgeting office use the similar analysis of ZBB such as “cost accounting, productivity studies, performance measurement, strategic planning, and MBO” (p.101). They also use a balanced scorecard for top managers to track the performance and execution of staffs and results. The disadvantage of TBB is “TBB permits non- rational reallocation decisions (randomly establish amounts of money) and political tradeoff decisions among departments”

budgeting process. First, what is an ideology? It is a set of beliefs, principles, or doctrines to guide a group of people such as a country or a class how society should work. These beliefs and ideas place value for people, directing their thinking about different activities and events. Democracy and capitalism are the major ideologies in the U.S. They have a deep influence on the conduct of public budgeting. “In America, the meaning of democracy rested on the notions of partisan bargaining, minority and fundamental human rights, diffusion of power, and the influence of partisans through collective action over time” (p.54). The budget hearing, information disclosure and decentralized regulations are good examples illustrating the ideology of democracy. In addition, one of the most representative example of illustrating this ideology is the popularization of entrepreneurial budgeting. Entrepreneurial budgeting empowers citizens and uses decentralized authority. It provides departments with more freedom to decide the budget and achieve the goals. The second major American ideology is capitalism. Under capitalism, people tends to limit the role of government and give play to the free market effect. In a more moderate idea stating the role of government, the government is