Better Performance with Performance Budgeting? Analyzing Cases of Success and Failure in Public Administrations

Abstract

The introduction of performance budgeting has substantially changed the working environment of public managers. Changes include a shift from input to outcome orientation as well as more freedom to manage. However, current public management theories are unable to explain why performance budgeting sometimes fails. This article proposes a causal model that integrates three contextual factors and two individual factors in order to explain the diverse results. The model is tested with cases generated from interviews with Swiss public managers. The compiled data suggests that the type of tasks in a department as an antecedent variable and the perceived freedom of public managers have a dominating influence on the perceived reform outcome. Other factors, such as the behavior of the legislature, the project management and the prior career of managers, tend to be less important. These results contribute to the scientific discourse about success factors for performance budgeting in public administrations.

Performance Budgeting and Medium-Term Expenditure Frameworks: A Comparison in OECD Central Governments

“…Previous research (Helmuth 2010) has shown that the perceived freedom of public managers has a dominant influence on perceived reform outcome. Moynihan and Pandey (2010) found that having greater flexibility, measured as the department being able to shift financial resources within its budget to accomplish its mission, increases reported performance information use.…”

New Public Management between reality and illusion: Analysing the validity of performance-based budgeting

“…Indeed, such human factors contribute to explaining the intensity of the budgetary use of performance information (Grossi, Reichard, & Ruggiero, 2016). Conversely, analyses have been conducted on the impact of PBB (or lack of) on behaviour of actors (Andrews & Hills, 2003) and the factors influencing the managers' perceptions of PBB success (Helmuth, 2010). From this perspective, few studies have assumed the point of view of the actors to investigate which specific challenges they experience in implementing PBB.…”

Performance Budgeting and Accrual Budgeting

“…Another stream of the literature has studied the factors that affect the success of the implementation of performance budgeting (Andrews, 2004;Andrews & Hill, 2003;Helmuth, 2010;Lu, 2011;Pitsvada & LoStracco, 2002). Previous research (Bourdeaux, 2008;Lu, Willoughby, & Arnett, 2009;Posner & Fantone, 2007) has shown the importance of the legislative processes in performance budgeting reforms.…”