Output vs Outcome, OUTCOME BASED BUDGETING

Output vs Outcome:

Outputs are tangible results of an activity which are short term, immediate and quantifiable

while

Outcomes are long term results having a long-lasting impact, qualitative and more focussed on qualitative aspect rather of merely quantitative aspect.

To understand:

01.Total sanitation campaign came into force in 1999 and on records there were toilets constructed in rural areas throughout the country but still people defecated in open.

Construction of toilets in numbers is Output while habit of using toilet is outcome.

Conclusively in case of TSC, output was there but outcome was not there.

02.Sarve Shiksha Abhiyan (SSA) is operational since 2002 and target was to educate all children between 6-14 age by 2010.

But ASER report-2023 published by NGO PRATHAM observed that over 50 % of the children in the age group of 14-18 years are not able to do elementary calculations.

So, bringing children to school is output but learning abilities is outcome, and ASER report clearly highlights that aspect.

Outcome Based Budgeting (OBB):

In view of such examples, outcome budgeting becomes of significance. In terms of Outcome Budgeting, Outcomes refer to the ultimate products and results of various government initiatives and interventions, These are represented in terms of qualitative targets and achievements, enhancing the comprehensiveness of the technique.

• outcome-based budgeting is one of the prominent budgeting methods currently practiced in India.
• OBB involves outlining and estimating the results of each program or scheme that has been developed.
• In OBB, program outcomes are evaluated not merely in monetary terms but also through physical achievements expressed in actual figures, such as learning abilities of students.
• Additionally, outcomes are conveyed in terms of qualitative targets and accomplishments to enhance the overall technique's comprehensiveness.
• This method assesses the developmental outcomes of all government programs and determines whether funds have been utilized for their intended purposes, including the effectiveness of financial expenditure.
• The outcome budget contributes to improved service delivery, informed decision-making, program performance evaluation, communication of program objectives, enhanced program effectiveness, cost-effective budgeting, accountability establishment, and better management of schemes.
• Outcome budgeting shifts the focus of government programs from being oriented around expenditures to being focused on results.
• In India, the Performance Budget was integrated with the Outcome Budget in 2007-08, resulting in a single document known as the Outcome Budget.

As on date in India, All ministries are required to prepare outcome budgets and presents it to Finance Ministry to ensure that budgeting is directed towards achieving specific targets.