What is Outcome Budget

An outcome budget aims to look at the performance of various ministries handling development programmes. It also looks at the expenses incurred by them.

 

A system of performance budgeting by ministries was introduced in 1969 following the recommendations of the Administrative Reforms Commission. For long, a need was felt to address certain weaknesses in the performance budgeting system, such as lack of a clear relationship between the financial and performance budgets and inadequate target setting for the ensuing year.

 

Besides, there is a growing concern to track the ‘outcomes’. It was first introduced in 2005-06 by the then finance minister, P Chidambaram.

 

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