PAD 505 Week 6 Discussion 2 Budget Decisions

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Week 6 Discussion 2



Budget Decisions

In a nutshell budgeting is a process of coming up with the estimated amount of money to be used within a given fiscal year by the government. In so doing, the person in charge of finance programs conducts research and analysis to be in a position to allocate funds for each ministry, local government and regions basing on their needs(Margaret J. Barr, 2010).

The general public however is not fully satisfied with any proposed budget for the following reasons; one of them is that there is always an aspect of locking out the preferences of citizens and preferences. In this, the public will always feel that things they deem integral have not been prioritized in the budget and instead those that are not at their hearts are taken care of on the grounds of generalization. The issue of security may be of concern in some region and not others but the budget may seem to lean towards the same since it is a national disaster.

There is also the problem of equity. When the budget is proposed you find that allocation of funds and resources varies from region to region or from ministry to the other stirring animosity among the public who might begin looking at it as a way of favoritism by the government. The problem has always been linked to skewed research in certain areas. Some regions may be small in terms of geographical size but allocated large amount of money yet those that are large only get meagre funds(Novick, 1967).

More so, in a perfect market, an efficient allocation of resources will be achieved by the forces of supply and demand, through the process of price mechanism. In the event that we have market failure, then public intervention is vital in the process. Lack of public intervention in such scenarios poses a threat to the public who feel left out of the proposed budget.

To optimize the above potential problems, there should be professional principals and agents who ought to conduct numerous research on the ground to ascertain the real needs of the people which should be reflected in the budget. Those needs that come first in a given region should be treated with great concerns and addressed.

Secondly, there should be modelling of the economy whereby we should have macroeconomic forecast, establishment of the Growth Domestic Product, growth, deficit, inflation and unemployment cases among others. These issues should be given priority before proposing any budget.

Lastly, there is to be rationalism whereby it seeks to relate policy to clearly specified goals for public intervention and when the goals have been defined, technicians should be on their feet to seek means of achieving them by appraising alternative strategies. Identification of the full range of possible solutions, an assessment of their feasibility and impact, and selection of the preferred option can be employed here.


Margaret J. Barr, G. S. (2010). Budgets and Financial Management in Higher Education. John Wiley & Sons.

Novick, D. (1967). Program Budgeting: Program Analysis and the Federal Budget. Harvard University Press.

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