An outcome budget is a budgeting method that highlights specific outcomes or results, rather than just allocating resources to programs.
It sets clear goals and performance indicators, identifies the costs and allocates resources based on expected outcomes. For example, Delhi government measures its outcome on 1932 performance indicators.
It measures whether the money that was sanctioned was utilised for the purpose it was sanctioned for.
Advantages:
- Improves accountability and transparency as the outcomes are easy to track and measure.
- Resource allocation is well aligned with the priorities of the government.
- Increased focus on outcomes ensure efficient and effective use of resources.
- Engagement of multiple stakeholders to identify goals and measure the performance.
As of 2021, 11 states in the country have implemented outcome-based budgeting; it was first adopted in India in the year 2005.
