What's new about evidence-based budgeting?
- By Michael Hardy
- Jun 01, 2012
With its recent call for evidence-based budgeting, the Office of Management and Budget is freshening up an old concept.
As reported by Matthew Weigelt on FCW.com,, OMB’s demand for evidence to support funding requests beginning with the fiscal 2014 budget forces officials to engage in a lot of internal — and at least some external — reviews to quantify and project a program's effectiveness, said Ray Bjorklund, vice president and chief knowledge officer at Deltek.
The push for evidence is tied to an accompanying goal: The budget requests agencies submit for fiscal 2014 should be 5 percent lower than the net discretionary amount provided for 2014 in the 2013 budget.
The attention to evidence isn't new. In fact, the recent directive builds on work that Peter Orszag championed during his tenure as OMB director.
“Rigorous ways to evaluate whether programs are working exist,” Orszag wrote on OMB’s blog in June 2009. “But too often such evaluations don’t happen. They are typically an afterthought.… This has to change, and I am trying to put much more emphasis on evidence-based policy decisions here at OMB. Wherever possible, we should design new initiatives to build rigorous data about what works and then act on the evidence that emerges — expanding the approaches that work best, fine-tuning the ones that get mixed results and shutting down those that are failing.”
And the concept goes back even further. Several readers noted the similarity between the recent directive and the zero-based budgeting of the 1970s. So what is new about OMB’s recent memo?
In “The Lectern” blog on FCW.com, Steve Kelman points out the cost factor. “The memo actually is less about the use of evidence in backing up budget requests than it is about agencies using more resources, even in tight budget times, to gather evidence about programs,” he wrote. New and less expensive methods for gathering evidence have been developed in recent years, and in many cases, agencies are already gathering some of the needed data for their internal performance improvement initiatives, he added.
So clearly, OMB's memo is, as the saying goes, more evolutionary than revolutionary. But agencies might find that compliance makes their budget requests more effective and more likely to become reality.
There are some cautions, however. An FCW reader named Bill commented: "OMB must be careful with their definition of evidence. The primary problem with business economics is that not everything can be assigned a price or cost in standard business terms. Thus, the private sector often devalues important humanistic activities — privacy, for example. It's up to government to ensure that these unassignable activities are treated properly and fairly. Requiring evidence in a purely economic sense...will follow the private sector [in] undervaluing these activities and abandoning important government principles."
And the existence of a directive doesn't guarantee it will happen.
"Planning and justifying a budget is a totally different matter from accounting for the subsequent spending," wrote FCW reader SPMayor. "I expect this effort to be difficult for agencies, just as preparing performance-based statements of work are. Evidence-based budgets and [performance-based statements of work] require a major shift in how one determines what the needed inputs or funds are to achieve a set of outcomes."