Performance budgeting: A means to improve EU spending

16-03-2018

In 2015, the European Commission launched an initiative entitled 'The EU budget focused on results'. It is aimed at changing spending culture and making results a horizontal priority for the EU budget. The initiative is based on a popular contemporary budgeting method known as 'performance budgeting'. This paper presents the method and its application to the EU budget. It explains why, although not easy to implement, performance budgeting is seen as an attractive way to increase value for money and enhance the transparency and democratic accountability of public finances. The paper also analyses how the performance budgeting approach has evolved within the EU budgetary system and what challenges and obstacles to its implementation remain. The commitment of the European Commission to the principles of performance budgeting, as well as the broad support for the idea expressed by the European Parliament and the Council, give grounds to believe that these efforts will continue in the post-2020 Multiannual Financial Framework.

In 2015, the European Commission launched an initiative entitled 'The EU budget focused on results'. It is aimed at changing spending culture and making results a horizontal priority for the EU budget. The initiative is based on a popular contemporary budgeting method known as 'performance budgeting'. This paper presents the method and its application to the EU budget. It explains why, although not easy to implement, performance budgeting is seen as an attractive way to increase value for money and enhance the transparency and democratic accountability of public finances. The paper also analyses how the performance budgeting approach has evolved within the EU budgetary system and what challenges and obstacles to its implementation remain. The commitment of the European Commission to the principles of performance budgeting, as well as the broad support for the idea expressed by the European Parliament and the Council, give grounds to believe that these efforts will continue in the post-2020 Multiannual Financial Framework.