NCJ Number
61266
Date Published
1979
Length
169 pages
Annotation
THE MECHANICS OF ZERO-BASE BUDGETING (ZBB) IN GOVERNMENT, THE HISTORICAL AND THEORETICAL CONTEXT OF ZBB, ZBB'S BENEFITS AND COSTS, AND ITS CURRENT PROBLEMS AND PROSPECTS ARE DISCUSSED.
Abstract
ZBB AIMS AT CONSTRUCTING BUDGETS FROM A 'ZERO-BASE' FOR EACH BUDGET PERIOD, WHICH MEANS THAT EVERY COST IN THE PREVIOUS BUDGET PERIOD IS ASSESSED AND ALTERNATIVES CONSIDERED WITH A VIEW TOWARD INCREASING COST-EFFECTIVENESS. THERE ARE THREE BASIC STEPS IN THE PROCESS: (1) DETERMINING PROGRAMS, FUNCTIONS, AND ACTIVITIES FOR WHICH SIGNIFICANT BUDGETARY DECISIONS ARE MADE ('IDENTIFYING DECISION UNITS'); (2) PREPARING JUSTIFICATION STATEMENTS THAT INCLUDE INFORMATION NECESSARY FOR MANAGERS TO MAKE DECISIONS ON PROGRAMS, FUNCTIONS, AND ACTIVITIES (PREPARING DECISION PACKAGES AROUND EACH DECISION UNIT); AND (3) IDENTFYING THE RELATIVE PRIORITY OF PROGRAMS, FUNCTIONS, AND ACTIVITIES (RANKING THE DECISION PACKAGES). EXCEPT FOR PERFORMING ZERO-BASE REVIEWS OF PROGRAMS IN A SYSTEMATIC AND FORMAL MANNER AND USING NEW NOMENCLATURE, THERE IS NOTHING INHERENTLY NEW IN ZBB WHEN COMPARED HISTORICALLY TO OTHER BUDGET PROCEDURES. ZBB'S MAJOR PUBLIC CONTRIBUTION IS IN DISPLAYING FOR DECISIONMAKERS THE TRADEOFFS EXISTING AMONG PROGRAMS AND THE INCREMENTAL DECISIONS RELATING TO SUCH PROGRAMS. IT GIVES AN AGENCY A USEFUL PROCEDURE FOR CONSTRUCTING ALTERNATE BUDGETS. THE COSTS OF ZBB, PARTICULARLY IN TERMS OF LABOR, ARE UNCERTAIN, AND NO MEANINGFUL CRITERIA OR DATA COLLECTION METHODS FOR EVALUATING ZBB HAVE EMERGED. ITS VALUES THUS REMAIN LARGELY THEORETICAL, ALTHOUGH CONTINUED USE AT THE FEDERAL AND STATE LEVEL SHOULD PROVIDE A BASIS FOR ASSESSING ITS EFFECTS. FOOTNOTES ARE PROVIDED FOR EACH CHAPTER, AND A GENERAL BIBLIOGRAPHY IS PRESENTED. (RCB)