The correct answer is: d) All of the above
Zero-based budgeting (ZBB) is a budgeting process in which all expenses are examined annually with the objective of eliminating the least productive items. Each department or program must justify its budget request from scratch, as if it were a new program, every year.
ZBB is based on the idea that every dollar spent by the government should be justified, and that no program or department should automatically receive an increase in funding just because it received funding in the previous year.
ZBB has several advantages. It can help to identify waste and inefficiency in government spending. It can also help to ensure that government programs are aligned with the government’s priorities. However, ZBB can also be a complex and time-consuming process.
In Odisha, ZBB was introduced in 2015. The state government has said that ZBB has helped to improve the efficiency of government spending. The government has also said that ZBB has helped to ensure that government programs are aligned with the government’s priorities.
Here is a brief explanation of each option:
- No automatic increase in allocations: Under ZBB, each department or program must justify its budget request from scratch, as if it were a new program, every year. This means that there is no automatic increase in funding for any department or program.
- Justification of each expenditure item: Under ZBB, each department or program must justify each expenditure item in its budget request. This means that the department or program must explain why the expenditure is necessary and how it will contribute to the achievement of the department’s or program’s goals.
- Focus on outcome-based budgeting: Under ZBB, the focus is on outcomes, rather than inputs. This means that the department or program must focus on the results of its activities, rather than the resources that it uses.
I hope this helps!