Program – Based Budgeting

Program-based budgeting is the approach to budgeting, where the focus of budgeting shifts from line-item expenditures to specific programs and their outcomes. Such a budgeting approach enables organizations-especially government agencies-to allocate resources based on the performance or efficiency attained through those inputs rather than focusing on the inputs themselves, such as salaries, supplies, or equipment. The main idea behind program-based budgeting is the improvement of decision-making and transparency with a better fit between financial resources and organizational priorities and goals by the analysis of results of each program and considering the costs of such programs.