Public Sector Governance and Accountability Series: Budgeting and ...

8
Budget Preparation
and Approval
salvatore schiavo-campo
T
his chapter focuses on the core processes of budget preparation,
mainly in light of the objectives of aggregate expenditure control
and strategic allocation of resources. The third objective of public
expenditure management—operational efficiency—underpins
chapter 9 on budget execution, and performance monitoring issues
are discussed in chapter 12 on budget reform priorities and
sequencing. This chapter discusses first the most important requirements
of good budget preparation as well as the most frequent bad
practices in budgeting. The chapter then describes the various
stages of a sound budget preparation process and concludes by discussing
the division of labor within the executive and budget
approval by the legislature.
Although this chapter focuses on the technical aspects of budget
preparation, in every country the budget process is inherently political,
requiring as it does choosing between different programs. No
objective technical rules can really determine whether, for example,
three additional rural health centers for one group of beneficiaries
are “better” than one additional urban primary school for a different
group of beneficiaries. One hears sometimes the wistful wish
to “get the politics out of the budget.” This wish is not only impossible
but wrong, because the legitimate authority of public expenditure
managers does not include making decisions about expenditure
policy. Instead, the characteristic of good budget preparation is to
235