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Outcome Budgeting in India

Outcome Budgeting is now being practiced both by the Union Government and different states as a budgeting strategy for linking outlays/allocations to concrete outputs and outcomes. The most commonly used tool, in this regard, has been the publication of the Outcome Budget Statement annually. Raising a few specific queries on this as below:

  • How many states are bringing out an Outcome Budget Statement annually (as on FY 2021-22), in addition to their state budgets?
  • If we consider the reporting structure in these statements, what are some of the better practices that these states have adopted over the last few years?
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Thanks for your question.

To answer the first part, currently, 11 states bring out Outcome Budget Statements. These states are:

  • Andhra Pradesh
  • Arunachal Pradesh
  • Assam
  • Bihar
  • Chhattisgarh
  • Delhi
  • Gujarat
  • Haryana
  • Jharkhand
  • Odisha
  • Uttarakhand.

Of these, Jharkhand and Haryana have brought out their Outcome Budget Statements for the first time in 2021-22.

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Answering the second part now…

As stated by you, the primary task of the Outcome Budget Statement (OBS) is to link outlays with desired outcomes. This is done in the above states as well as Union OBS. However, there are a few salient components/better practices that incorporated by some states:

  • Robust linking to global indicators like Sustainable Development Goals - Currently, four states, namely Assam, Haryana, Jharkhand and Uttarakhand have linked the outcomes with SDGs in their OBS. Given below is the format used by Haryana, which meticulously links SDGs to outcomes.

  • Remarks or Risk Factors – The OBS of some states like Delhi, Jharkhand and Odisha have a column for remarks or information about the risk factors associated with the completion of intended goals. This highlights the deeper level of engagement of the states while preparing these statements, as they are thinking about the process of carrying out a task and noting the possible hindrances therein.
  • Bilingual Outcome Budget Statement - Jharkhand brings out a bilingual OBS, using English and Hindi. This greatly enhances the usability and accessibility of the document.
  • Details of Target Beneficiary - Jharkhand also dedicates columns for social category and gender category, which enhances the understanding about the population to be benefitted by a certain expenditure. Given below is a snapshot of the OBS of Jharkhand.

  • Projection of Physical Targets – The OBS of Gujarat gives a three-year projection of physical targets to be achieved by a particular expenditure. This ensures consistency in spending towards a certain goal.
  • Intermediate Assessments - There is a scope for the outcome budgets to be relegated as yearly administrative exercises. It is, therefore, imperative to conduct mid-term assessments on the progress of outcomes and make the information publicly available. This integrates outcome budgeting to budget monitoring and enhances transparency and accountability of government spending. Delhi conducts a quarterly review of major departments and brings out a document called ‘Status Report of Outcome Budget’, which is, as the name suggests, a progress report for the outcomes stated in the outcome budget. This should be adopted nation-wide.
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Hi Simonti,

We have recently published a Working Paper which maps the outcome budgeting practices in India.
This paper discusses the good practices that strengthen the outcome budgeting process by enhancing transparency, accountability and enabling effective monitoring of progress. It gives details on how the practice of outcome budgeting is carried out by the Centre and States in India. It also sheds light on some ways in which this process can be standardised and strengthened across the country.

You can access this paper at https://www.cbgaindia.org/working-paper/outcome-budgeting-in-india-a-mapping-of-efforts-being-made-at-the-union-and-state-levels/

Thanks for sharing this Vijayta!

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