A university (Enormous Public University) has the following line items in its traditional budget structure for its School of Public Affairs. These reflect the goals of teaching, research and service to the university, state and the nations that are funded through tuition and state support.
Academic Salaries
Part Time Instructors
Student Academic/Fellowships
Professional Salaries
Clerical Studies Wages (PT)
Group Insurance
Retirement
General Supplies and Expense
Travel Equipment
Transfers Out
NEW PERFORMANCE BUDGETING
NEW PERFORMANCE BUDGETING springs from efforts to move budget processes from an input focus to one focused on results or outcomes. Agencies identify the outputs and outcomes to be produced by their programs, they set performance targets and make budget requests based on that performance and they are accountable for those results without micromanagement of inputs. The NEW PERFORMANCE BUDGET logic is comparable to that of the private sector- to make a profit, not to buy materials. It looks toward the result, or outcome, of agency operation and accordingly tests agencies on results, not on how results are attained. The performance, result, or outcome orientation turn sthe input control focus of traditional budgets on its head. The ideal NEW PERFORMANCE BUDGET would have sparse detail on what the agency would purchase because control would be on what the agency would provide. It involves orbjecitves and a strategic plan; performance measures; flexible execution and; reporting.
THIS QUESTION HAS THREE PARTS:
If you were to change the method of budgeting for the School of Public Affairs from a traditional budget into a NEW PERFORMANCE BUDGET, what would the measurable outcomes for which the school might be responsible?
What budget classifications would you prescribe for each outcome?
What problems might you encounter in assigning spending to the categories?
Leave a Reply