How Performance Budgeting Can Help

21ST CENTURY CHALLENGES

How Performance Budgeting Can Help

Reexamining the base of all major existing federal spending and tax programs, policies, and activities by reviewing their results and testing their continued relevance and relative priority for our changing society is an important step in the process of assuring fiscal responsibility and facilitating national renewal. Reexamination can arm decision makers with better information on both individual program results and entire portfolios of programs and tools—encompassing a wide range of discretionary, entitlement, tax, and regulatory approaches—addressing common goals .GPRA provided a foundation for strengthening government performance and accountability. The President’s Management Agenda and the Program Assessment Rating Tool (PART)—OMB’s framework for assessing federal program performance—continue to build on GPRA’s foundation. Properly done, these and future efforts—along with a set of Key National Indicators (KNI)—could provide a strong basis to support the needed review, reassessment, and reprioritization process. Moving forward, for performance budgeting and program reviews to hold appeal beyond the executive branch and actually have an impact on legislation, congressional buy-in on what to measure and how to present this information is critical. In addition, tax expenditures result in forgone revenue that in some years has approximated the size of total discretionary spending. Yet relatively little is known about the effectiveness of these provisions, which are often aimed at policy goals similar to those of federal spending programs. To date, PART has generally not been applied to tax expenditures. GAO continues to urge as a next step a more comprehensive and consistent approach to evaluating all programs relevant to common goals. This would require assessing the performance of all programs related to a particular goal—including tax expenditures—using a common framework.

As part of its work to...