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Over 50 years have been passed since the first emergence of performance budgeting in literature and practice in government. Yet, this concept is struggling to attain its stand among other budget allocation methods.
The idea of improving the efficiency and effectiveness of public expenditure by linking the funding of public sector organizations to the results they deliver is so logical and valid that no one with a common sense can deny it.
However, what is so difficult about this accepted logic that has not gained much success in practice throughout its long history.
To comprehend the dilemma, one should delve deep into this simple logic. PB comprises two basic components: Budget and Results. The slogan of the First International Performance Based Budgeting Conference- Budgeting for Results- was coined to refer to these two elements.
According to Professor Allen Schick, the Conference Co-Chairman, first, PB is a system for compiling and presenting information on actual or expected results; second, PB is a system for "buying" results through the expenditure of public funds.
Focusing on the latter, the Second International Performance Based Budgeting Conference tried to explore costing methodologies and challenges to produce unit cost information of government operations and services (outputs) delivered to later be linked to the outcomes delivered.
The Third International Performance Budgeting Conference intends to concentrate on the first element, i.e. informational challenges in regard with producing and presenting actual and expected performance information to be used in budgeting allocation. The availability of the right type of performance information is therefore a core prerequisite for the success of performance budgeting. It is equally important to create the appropriate processes to ensure that the information is actually used. More generally, performance budgeting needs to be accompanied by a broader set of "managing for results" reforms to encourage agencies and individuals to perform better. Therefore, the performance budgeting system should provide a strong link between the performance Information i.e. results and the unit cost information to develop the budget.
Hopefully, this conference, with participation of PB experts, lecturers and practitioners, will be successful in offering practical advice for improving the prospect for performance budgeting to succeed in Iran.
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