Question

Discuss what is meant by the statement, “public budgeting involves the selection of ends and the means to reach those ends.” List and discuss each of the elements used to describe a budget from the section of the course textbook entitled, “what is a budget?”. Discuss the major characteristics of public sector budgeting vs. private sector budgeting. When doing so, be sure to make note of the information associated with how the differences in objectives, the differences in services provided and the differences in responsibility may play a role in budget efforts.

Answer 1

Budget means creating a plan ahead for a year to manage the income, expenditure, assets and liabilities, this can be made by individual, group, company or government .

A government budget is the annual plan for the fiscal year with estimated government expenditure and government income from its different sources. There are 3 types of budget-

1. balanced budget

2. deficit budget

3. surplusb budget

Public sector budgets are made by government while private sector may be by individual,groups, organisation, companies. A public sector budget will be of social welfare and infrastructure development and to provide projected services is the main objective while private sector budget will be of making profit, maximize revenue generation and meeting overheads , reduce cost. The formation of a budget plan in a private sector will be with a good amount of calculation and approved after scrutinizing. Most of private sector plans are impartial and based on policies within the organisation. While government budgeting process is a great challenge as revenue generation and services are some times manipulated by Politicians. Private sector clearly accounts and works out the budget plan and yearly audits are kept to get the track of their financial performance and have to share the same withe share holders and it's financial stability is showcased while government audits are done by government legislation agencies. They generate revenue from tax from different sectors.