Budget theory in local government: the process-outcome conundrum

Abstract

Local government budget processes have changed substantially since the early 1990s, due in part to an expanded emphasis on performance accountability and the availability of information technology. We present evidence that local government budget outcomes also have changed over the same time period when disaggregated at the functional level. Though we do not assert a causal relationship between the two, our findings indicate that the normative-descriptive gap in budget theory described by Rubin (1990) deserves new scholarly attention. Our profession's attraction to incrementalism may have blurred the success of budget reform in local government. INTRODUCTIONDrawing on evidence collected approximately 20 years ago, Rubin (1990) concluded that planning was merging with budgeting. Based on this observation, she predicted that the gap between normative and descriptive budget theory would close over the coming decade. Normative theory traces its roots to the emergence of public budgeting at the turn of the 20 th century. There have been variations, but only one theme. Budgeting should include planning for service provision, which entails setting service targets and allocating resources to achieve them. It is a rationalistic approach-so there is little surprise that theme variations have produced different forms of rationalism. Some have emphasized planning

Analysis of Stakeholder Perception on Transparency, Accountability And Effectivity In School Operational Assistance Funds Management For Junior High School Level In North Aceh Regency

“…Budget theory is related to changes in the budget process that are mandated from outside the organization, where these changes do not refer to the interests of the organization (Adams, 1985). Budget theory proposes more about how organizations develop budgetary capacity for change, not for matters relating to certain priorities (Kelly & Rivenbark, 2008).…”

“…The public will judge that the budget is effective by the way they feel from the budget, meaning that the budget has an impact on the public as a whole (Aliabadi et al, 2019). Effective management of public funds in the eyes of the public will foster high trust and credibility, thereby encouraging the financial performance of public institutions (Kelly & Rivenbark, 2008).…”

Taking Stock: Assessing and Improving Performance Budgeting Theory and Practice

“…Some studies look at performance budgeting as a budget phenomenon and provide some theoretical discussion of the tool in the context of budget incrementalism and rationalism (Kelly & Rivenbark, 2008;Pitsvada, & LoStracco, 2002;Reddick, 2007). Others look at performance budgeting more from an organizational management perspective and examine how the structure and process, organizational nature, and managerial capacity influence the implementation and success of reforms (Gueorguieva et al, 2009;Moynihan, 2006;Sterck, 2007).…”

Budget priorities and community perceptions of service quality and importance

“…The need for government officials to treat citizens as customers and their demonstration of program effectiveness has been touted as means to address citizens' skepticism (Osborne & Graebler, 1992). One approach to providing accountability emphasizes direct citizen control or influence over the formation of budgets, including the allocation process and priority setting in the budget (Rubin, 1996, p. 115) Budgeting includes both planning for service provision and allocating resources for those services (Kelly & Riverbank, 2008). Rubin described the history of accountability in budgeting, concluding that additional effort is needed to interest and attract the public.…”