THE RISK ASSOCIATED WITH THE REPLACEMENT OF TRADITIONAL BUDGET WITH PERFORMANCE BUDGETING IN THE PUBLIC FINANCE SECTOR MANAGEMENT

Abstract

Cite as: Emerling, I., Wojcik-Jurkiewicz, M. (2018). The risk associated with the replacement of traditional budget with performance budgeting in the public finance sector management, Ekonomicko-manazerske spektrum, 12(1), 55-63. Abstract: Performance budgeting has been functioning in Poland for almost twelve years now and it still can be said that it is a challenge for the entire sector. So far many countries have attempted to implement it, proposing a transition from the traditional budget to the performance budgeting. It should be noted that this also causes a change in thinking which does not come too easily, especially in case of managing public administration. In addition, the performance budgeting is a key element of the management system. The purpose of this paper is to show that the replacement of traditional budget with performance budgeting is desirable in public administration. It would lead to the improvement of the quality of state management and as a tool it would allow to effectively monitor and evaluate the results and efficiency of budgetary funds administrators. The performance budgeting is a tool for public governance management. The applied research methods are the method of critical analysis of literature studies and the analysis of the advantages of drawing up a task-based budget in relation to the traditional budget in managing the public finances unit. These methods will be presented in the context of their suitability to demonstrate that it is necessary to convert the traditional budget into a budget in a task setting, in public administration. The basic hypothesis is the assumption that the use of a task-based budget will lead to improvement in the quality of state management, and as a tool it will allow effective monitoring and evaluation of the results and effectiveness of budget part managers.