Financial Administration

Answer : The quest to bring out efficiency and effectiveness in the management approach to budgeting led to the search of different forms of budgeting process. The emancipation of performance budgeting was one of such approach. The establishment of First Hoover Commission in USA in 1949 was definitely to search out the best management approach for budgeting. This commission recommended for the performance budgeting. Accordingly, it was introduced by President Truman in 1950.

The Performance Budgeting (PB) emphasises on the purpose of expenditure rather than the expenditure itself. It presents budget in terms of functions, programmes, activities and projects.

It establishes a correlation between the physical (performance or output) and financial (input) aspects of each programme and activity. Hence, it necessitates a functional classification of budget.

The advantages of performance budgeting are as follows:

1. It presents more clearly the purposes and objectives for which the executive from the parliament seeks the funds.
2. It brings out the programmes and accomplishments in financial and physical terms both.
3. It facilitates a better understanding and better review of the budget by the parliament.
4. It improves the formulation of budget.
5. It facilitates the process of decision-making at all levels of government.
6. It increases the accountability of the management.
7. It provides an extra tool of management control of financial operations.
8. It renders performance audit more purposeful and effective.

But there are certain difficulties in the full adaptation of performance budgeting as certain conditions are necessary, which are as follows:

1. It would be necessary to have a system of advance programming of government operations on a long-term basis.
2. The end results of the programme must be measurable.
3. The outlay shown in the budget should represent the entire cost.
4. The programme should be closely monitored by the budgeting authority.
5. The total outlay should be capable to allocate between fixed and variable costs.

Apart from these, the performance budgeting has to follow a certain manner, a proper classification of activity by each ministry accompanied explanation justifying the financial requirements under each activity.

Answer : The classical science of administration is at the centre-stage in evolution of the Public Administration. The excessive research done by the theorist like F. W. Taylor, Henry Fayol, Gullick, Urwik, Max Weber gave the very base to the field of public administration on which in later years public administration developed. But the classical science suffers from many flaws like their value neutral mechanistic approach etc.

The classical scientist mainly concentrated on increasing efficiency and completely ignored the human part. Taylor in his scientific management theory interpreted the organizational efficiency in the mechanistic terms only. He treated worker as a machine. He is also criticized for oversimplification of human motivation. He talked only about financial incentives. Same way Fayol was also opposed for his mechanistic model.

The classical theorists on the other hand were criticized as an unscientific theory of organization. It is said that the theory was not tested under scientific conditions, thus the empirical base was missing. It was an ‘atomistic’ theory as it saw human beings in isolation from the fellow men in organization. It is described as ‘normative’ theory because it is more concerned with what ought to be rather than what is, thus unlike the behavioural approach, it did not study the actual behaviour in the organisation.

The classical science of administration was termed as a closed and static model. There is virtually complete exclusion of the organization from the outside environment. At the motivational front it talked only about economic incentives. There was nothing to address the workers grievances. They were taken as granted. He was thought that they will work harder for money.

The workers were treated like a cog in the machine. That’s why the classical science was criticized by Dwight Waldo. Waldo was against the value neutrality of classical thinkers. He was against the mechanistic model. Waldo said that public administration needs a change by which it can be made more relevant to the society. This change can only be imparted if it include values human emotions in the administration.

The classical writers were against the inclusion of value in the administration because they wanted to make administration a science. But in this course of action they stood against the use of administration for the welfare of common and poor people who later accused public administration as irrelevant for their welfare. Waldo wanted to remove those flaws so that the social equity is achieved and public administration be seen as the only answer to their miseries.

Some way Robert Dahl criticized the classical thinker for their quest of making administration a science. Robert Dahl said that mechanistic model is of no use as it’s almost impossible to keep human emotions out of the picture. He said that it’s becoming increasingly difficult for the public administration to avoid human emotions and values. The second thing for which he criticized the classical thinkers was their indifference towards making public administration a comparative science. He criticized the classical scientists for not doing enough research in this field.

The principles given by the classical scientist were criticized and termed as mere ‘proverbs’ by Simon. He said that every principle contradicts with other principle. For example he said that ‘principle of specialisation’ and ‘principle of unity of command’ contradicts each other. Whatever be the criticism but its clear that the classical science provided a deep insight in to organisation analysis and they developed public administration in to a science.

Answer : Audit is indispensable for sound and proper administration as it acts as a watchdog and keeps an eye on the spending of public money. Due to this reason the administrative agencies have always to be extra vigilant in order to save themselves from financial criticism.

Audit is of many types like Audit of expenditure, Audit of propriety, Legal audit. All these types checks the honesty, prudency, malpractices, negligence, wasteness in the spending of tax payer’s money. They check all the financial record of any department or public enterprises. Due to this power the departments have to keep all their records systematic and updated. They have to show all the transactions. Because of which their corruptness or misuse of funds can be caught.

All these reasons makes the departments and public enterprises careful about their spending. They become reluctant to start any new project or take initiative because of the fear of failure and loss of money. Also the auditor is an outsider who checks and audits the accounts, due to which the companies and enterprises do not like his institution.

Answer : Budgeting approach contains many developmental projects, which are formulated by heavy discussions and deliberations. Failure of its implementation means a huge loss of expensive working hours and money or public funds. This is why that the government should make sure that there is an inherent incentive mechanism in the budgeting approach that can motivate the officials who have the responsibility of implementation.

The budgeting approach is considered as a instrument of social change and development. It has many policies for target groups or regions or field of economy. That’s why it is central to the country’s developmental direction. If it is not successfully implemented then there can be many repercussions like wastage of public funds, lagging behind from rest of the world in developmental process and also social unrest due to the belief that the government is not doing anything for the citizens.

In order to save the country from all these problems one way is to offer incentive not only to the policy formulators but to the policy implementers. The institutions which are the main channels for implementing the projects should be motivated by offering incentives, so that they can keep doing their work continuously and consistently.

All this can be done by providing an incentive mechanism which is inherent in the budgeting process. Like achieving the short term targets in a given time frame will win the awards from the government. So its essential for the consistency and continuity of implementation that the incentive be offered.

Answer : The Budget is a comprehensive plan of action designed to achieve the policy objectives set by the government for the coming year.

It helps in coordinating various aspects of government objectives.

Budgeting is the heart of administrative management. It serves as a powerful tool of coordination, and, negatively, an effective device of eliminating duplication and wastage.

Coordination is served by devices such as, justification of estimates, supervision of the use of appropriated funds, timing of the rate of expenditure, and the like. Budgeting inculcates, cost-consciousness, and this feeling should permeate all levels of administration including the operating level.

Accountability continues to be an important function of the government budget even today owing to its usefulness in budget execution and plan implementation. Other way of coordination is planning. Budgeting provides a plan of action for the next financial year. Planning, however, involves the (i) determination of long term and short term objectives, (ii) determination of quantified targets and (iii) fixation of priorities. Planning also spans a whole range of government policies keeping the time factor and interrelationships between policies in view. Planning envisages broad policy choices. Planning in the budget process reflects political pressure as well as financial pressures and financial analysis.

Answer : The Budgetary responsibilities of the modern government are vast and grave, for budget, to quote the often-quoted Gladstone, “goes to the root of prosperity of individuals, the relation of classes and the strength of kingdom. In the budget making are projected the financial policy of the government, the aspirations and anxieties of its several organs.

The budgetary responsibilities strictly speaking, are not the exclusive concern of one particular ministry, howsoever powerful it may be. All the ministries come into the picture at various stages and in varying capacities.

The Ministry of Finance, dealing with the financial business of the government, has overall responsibility for framing the budget. The Finance minister is the steward of the nations purse. It is his paramount duty that the national finances are conducted prudently and efficiently. The finance ministry, responsible for raising necessary revenues for the state, must have a predominant voice in determining the amount, and, in some degree, the character of the expenditure.

The financial rules of the Union Government confer the financial powers upon the Ministry of Finance. This arrangement has been envisaged under article 77(3) of the Indian constitution, which authorizes the union president to make rules for conducting the business of the union government. The Finance Ministry is responsible for the preparation of the Annual Financial Statement for piloting it through parliament, for supervising its execution by the various departments, for collection of revenue, and for giving financial control generally.

The Finance Minister finally presents the budget to the Lok Sabha. This he does with the speech known as the Budget Speech. This is Budgeting Analyzing Process. After the presentation of Budget in parliament, the latter passes ‘vote-on-account’ excess demands for grants, ‘vote-on-account’ varies from two or more months for the new financial years.

Answer : Government Budget is a comprehensive plan of action designed to achieve the policy objectives set by the government for a coming year. A budget is a plan and budget document is a reflection of what the government expects to do in future. While any plan need not to be a budget, a budget has to be necessarily a plan. It shows detailed allocation of resources and proposed taxation or other measures for their realization.

Budget reflects plans, programmes, projects, schemes and activities – current as well as new proposals for the coming year; resource position and income from different sources, including taxes and non tax revenues; economic, statistical and accounting data regarding financial and physical performance of the various agencies and organs of the government.

Planning involves the (1) determination of long term and short term objectives (2) determination of qualified targets and (3) fixation of priorities. Planning also spans a whole range of government policies keeping the time factor and interrelationships between policies in view.

Planning envisages broad policy choices. The goals of public sector, viz. (1) optimal allocation of resources (2) stabilisation of economic activity (3) an equitable distribution of income, and (4) the promotion of economic growth are all pursued in an organization context.

Today, a modern budget has to play a very important role in social and economic life of society. The budget has a vital role to play in the economy of a welfare state. Through a budget citizens are benefitted from various plans and programmes of the government. Through its taxation policy the government tries to narrow down the class distinctions and inequalities. The production policy of the government aims at removal of poverty, unemployment and mal-distribution of wealth. The budget, therefore, has multifarious social and economic implications.

Similarly budget serves as efficient tool of legislative control. Budget is the most important tool of legislative control over the public purse, and thus, the executive. Legislative control signifies that no tax can be collected without prior approval. This legislative control fanned itself out in the hope of some principles, which reflects parliamentary aspirations to keep the executive under control. These principles are —Publicity- is an essential feature of budget, which is no longer an estimate of government revenue and expenditure but a vehicle of social reconstruction and public welfare.

Clarity: Budget is a complex document. However it should presented in such way as to be clearly understood by the common man.

Comprehensive:The most important feature of a budget is comprehensiveness. It means that budget should bring together in one consolidated statement all the financial requirements of the government. Thus it should be able to give clear picture of government revenue and expenditure.

Prior Authorisation:All funds to be spent during a fixed period must be sanctioned before end. It is the legislature, which sanctioned budget.

Further, Budgetary techniques like Performance Budgeting, Programme Budgeting, Programme Planning Budgeting and Zero Base Budgeting etc. have facilitated more transparency in financial management. They act as an important tool of control over public purse. They provide a clarity in planning.

Answer : Audit means an examination of accounts with a view to the correctness of these accounts and of the transaction they embody.

Audit of governmental accounts in all countries is largely a legality and honesty audit, i.e., it largely confines itself to seeing that expenditure is in conformity with the laws and rules and is supported by adequate vouchers.

Audit is conducted after the events have occurred, it cannot prevent an overpayment or nonobservance of the financial rules and regulations. Also it cannot stop the executive authorities from the commission of any irregularity or impropriety during the course of transactions. But the effectiveness of audit depends upon its right to report the results of audit to the proper authorities, which may be a departmental authority, the Government itself, or parliament through the Public Accounts Committee. These bodies can then take appropriate action to rectify the irregularities or impropriety.

Though Audit Report appear post mortem, they serve many purposes like-they are an aid to administration to ensure that irregularities are not repeated in future; they help the planning process in not conceiving faulty schemes; they give the right signal for mid-course correction in on-going schemes. Lastly they also serve the basis for taking appropriate disciplinary action by the administrative authorities concerned against the persons who have caused loss to the exchequer by their acts of omission and commission to act as a deterrent.

Audit Report should, however, be largely current and should be able to bring out the failures, drawbacks or deficiencies as quickly as possible, to have prompt remedial measures.

Answer : Statutory external auditing refers to a system of auditing through which accounts and transactions and various deals of government of central or state comes under Scrutiny. There is a constitutional agency that CAG which is responsible to audit the document, accounts and transactions of government of India and state. It is a kind of control technique which has constitutional sanctity.

Auditing is in real sense true protectors of democracy in the Parliamentary form of government, because as we know Government takes up various developmental and welfare programmes, in all these projects it is public money which is directly involve which comes from tax revenue and various other services.

Now, to see whether, these public money is properly used by our Administrators, according to rules and regulations, and according to sanction of proper authority and to see whether money is used for purpose for which it is sanctioned, and above all to see whether it is used with good faith, wisdom and efficiently, there has to be some control process or system which can assure that public money is used properly, it is only auditing through which such check can be put upon permanent executives or administrators.

Answer : The term Budget is very comprehensive term. Now, in the words of Willoughby: “The Budget is something much more than a mere estimate of revenues and expenditures. It is, or should be, at once a report, an estimate and a proposal.”

Thus, the budget is a statement of the estimated receipts (revenue or income) and expenditure of the government in respect to a financial year. Now, from the above definition and meaning, we can easily say that budget is very comprehensive term and it acts as standard for various elements or activities and the work of executive should be focused by achieved standard set by budget whether it is specific element of expenditure or revenue.

The budget is a very effective tool of management also because of the following benefits derived from budget:

1. It ensures the financial and legal accountability of the executive to the legislative.
2. It ensures the accountability of subordinates to superiors in the administrative hierarchy.
3. It is an instrument of social and economic policy to serve the functions of allocation, distribution and stabilization.
4. It facilitates the efficient execution of the functions and services of government.
5. It facilitates administrative management and coordination as it unifies the various activities of the government into a single plan.

With above discussion and benefits derived from budget it is evident that budget is comprehensive term which includes various aspects of government objectives and activities to be taken up in ensuring fiscal year and it also facilitates coordination of the various activities of the government into a single plan. So it can be said that budget is a vehicle of fiscal policy and a tool of management.

Answer : Time from 1991 to 2001 was very significant decade in the Indian Economic environment because this was time for Privatization, Globalisation, Liberalisation. During this time very crucial decisions were taken by then Government in power. During this time various monetary and fiscal policies were introduced to pave the way for privatization and liberalization. Various sectors were inclusive territory for Public Sector were open for Private Sector like, telecom, petroleum, insurance, banking etc., except defence and few other strategic sector.

Following are the various important points and facts related to Monetary and Fiscal policy which open Indian economy towards Globalisation.

Firstly few important points of Monetary Policy of 1991-2001.

1. Bank Rate and Repo Rate remain unchanged.
2. Investment by banks in Securitised assets representing direct (indirect) lending to agriculture would be treated as their direct (indirect) lending to agriculture under priority sector provided the Securitised loans are originated by banks and financial institutions.
3. Micro finance institutions will not be permitted to accept public deposits unless they comply with extent regulatory framework of the RBI.
4. Credit Information Bureau of India would work out a mechanism in Consultation with RBI. SIDBI and IBA to predetermine appropriate pricing of loans to small and medium enterprises.
5. An intensive programme of restricting RRBs and Cooperation.
6. Bank can raise long-term bonds with maturity of 5 years to the extent of their exposure of residual maturity of over 5 years to the infrastructure section.

Similarly various important steps were taken and various schemes were announced in the fiscal policy to attract private sector to invest in various sections of economy, for that license policy was liberalized, term benefits were introduced, various subsidy were introduced to private sector to invest their capital for economic development of India and generate employment for Indians which Government alone cannot do which was realized by this time.

As far as international organizations are concerned the International Monetary fund and World Bank in particular played a crucial role in Indian economy towards Globalisation, because these institutions finance India’s various programmes and policies, so in return they have to follow the norms of these institutions and they have to follow the various rules and policies of these institutions. So, these institutions have really played crucial role in the Globalisation of Indian economy.

IMF played an important role in Indian economy. IMF has provided economic assistance from time to time to India and has also provided appropriate consultancy in determination of various policies in the country. India is the founder Member of IMF. India has taken loans in foreign currencies from IMF for improving its balance of payments imbalances. India has also taken technical consultancy for solving its internal economic problems. The expert groups of the IMF have visited India on various occasions.

Similarly World Bank supports India. India is the World Bank’s largest single borrower, with cumulative lending of more than US $ 47 billion in market based loans from International Bank for Reconstruction and Development.

As on December 31, 2000, the Bank’s lending port-folio of ongoing projects for India comprised 66 projects amounting to about US $11.5 billion.

The sectoral allocation of existing port-folio is concentrated in rural development (23 percent of total commitments), education and health (23 percent combined) and infrastructure, including energy (20 percent).

Answer : The concept of accountability implies the obligation of the administration to give a satisfactory account of their performance and the manner in which they have exercised powers conferred on them. Its main aim to check wrong and arbitrary administrative actions and increase efficiency and effectiveness administrative process.

Even though we have various methods and procedures to make administrator accountable for performance and activities taken up by them. There are various agencies through which there is a control on these administrators but as we know in particular in Indian administrative system that these control are inadequate and ineffective and fail to give derived result, which can be verified by fact that in spite of so many constitutional method there is many corruption cases have been unearthed in recent years. So in Indian Administration there is utter disregard of accountability.

In India we have many devices or mechanism to enforce accountability of public administrators. We have many control devices like legislative control, executive control and judicial control.

In legislative control, we have so many devices through which performance and activities of administrators are controlled in legislative control, we have, Question hour, Zero Hour, Half an Hour discussions, Short Duration Discussion. Apart from this mechanism we have various motions through which control can be exercised like adjournment motion, no confidence motion, and censure motion.

To control various other detailed aspect of administration, parliament have set up various committees i.e., parliamentary committee, estimate committee, committee on departmental undertakings, etc.

Now under executive control, the political head of the administrative ministries give direction on policy making and these direction has to be adhered by permanent executives.

There is again, one has Budgetary system, the executive controls the administrationhas through budgetary system. It formulates the budget, gets it enacted by the parliament and allocates the necessary funds to the administrative agencies to meet their expenditure.

Similarly we have judicial control in our constitution. The control exercised by the courts over the administrative acts is called judicial control. In other words, it means the power of courts to keep the administrative act within the limits of law. It also implies the right of an aggrieved citizen to challenge the wrongful acts of administrations in a court of law. The primary objective of judicial control over administration is the protection of the rights and liberties of citizens by ensuring the legality of administrative act.

Courts exercise these control over administrator by adopting the device of Judicial Review, Statutory Appeal, taking up suits against government, suits against public officials.

Apart from these devices Judiciary can issue various kinds of writs, which are called extraordinary remedies. These are various writs which are issued against various officials which are Habeus Corpus, Mandamus, Prohibition, Certiorary, Quo Warranto and injunction. Inspite of all these mechanism, we have witnessed that there is more corruption in public administration and administration are known for inefficiency and red tap characteristics.

Now, to make the mechanism or accountability more effective, there are several devices which can be used in public administration. In an office, inefficient and not performing well officials should be demoted or should be compelled to leave the service. For such practice there has to be a separate courts for corruption cases which can take up such matters and make speedy disposal of such cases.

Second and foremost device is information. Information can play very vital role to curb corruption and to make administration accountable. In this regard central government has done a very applicable job by making Right to Information act, through which, citizens can directly control and ask or raise questions to administration, in case they are not responding to their problems, similarly we must make these administrators accountable to various pressure groups and above all civil society can also play a very crucial role in this regard.

Answer : A performance budget presents public expenditure in terms of functions, programmes and activities, and thus, stands, out from line-item (traditional) budget which only emphasizes staff, furniture, equipments etc. The (Indian) Administrative Reform Commission defines performance budgeting as “ a technique for presenting government operations in terms of functions, programmes and activities on projects.”

On the recommendation of Administrative Reform Commission central government have introduced performance budgeting in 1968. In that year (i.e., 1968) performance budgets of four central ministries were prepared. In 1977-78 about 32 developmental departments in the central government have switched over to performance budgeting. Many state governments have also introduced performance budgeting in selected departments.

Though performance budgeting was introduced in central government nearly a decade ago, all the benefits visualized from it have not accrued. The concept of performance budgeting had aroused extravagant hopes, and when the technique was put into operation, a measure of disappointment was inevitable. More importantly its implementation has been deficient in many ways.

Firstly, there is no correlation between inputs and outputs. Secondly, unit costs of data have not been worked out in respect of important programmes. This is a serious shortcoming, for unit costing contributes to efficiency. Thirdly, setting of targets and measuring of performance is not very rational in the absence of scientifically evolved norms and standards are among the prerequisites of target fixation and performance measurement. While it is essential in a performance budget that it shows targets and achievement for previous year and the current year. In India the achievement figures are not shown in many cases. This reduces the effectiveness of performance budget as a tool of management control. This is its fourth shortcomings.

Fifthly, the technique of performance budgeting has not been followed night down each cost centres. It makes this budgeting less realistic and useful. Sixthly, though many projects extent even a period of years the future cost are not shown in the performance budget. Neither cost nor relevance of individual schemes to the national objectives made implicit in the performance budget presently. Budgetary system is being practiced in India is line-item budget. Line-item budget implies that expenditure required to purchase or require particular building, stationery and number of personnel to be acquired, their price target attached to each and every item of expenditure. Now this system has been adopted in India because of failure of performance budgeting on a particular point. Firstly in performance budget input-output relation was not clear but in line-item budget input and out put relation can be clearly depicted. Similarly unit cost of each cost center, which is not possible in performance budgeting is very much possible in line-item budget. Taking into various advantages and disadvantages of various budgeting system govt. of India found line-item budgeting is more appreciate in Indian context, i.e., it is still followed or practised in India.

Answer : Budget is very important tool of socio-economic transformation. Budget implies planning in advance, the various programmes and policies to be taken up in forthcoming year. Budget is instrument through which total finance required to take up development programmes and estimated revenues of government from various activities are planned properly and final shape is given by the finance ministry.

As we know that India is developing country with limited resources and various problems of poverty, public health, education, food and shelter. So it is the duty of the state to use these resources at best possible way so, that maximum benefit could be achieved without wastage of scarce resources. These resources should be utilized for social and economic development of our country.

We can achieve socio-economic development through proper planning and through proper budgeting process. So budget is important for socio-economic transformation.

Answer : Budget is a financial document which is annually placed before the legislature, by the executive. It gives a complete statement regarding the government revenue and expenditure of the past financial year and an estimate of the same for the next financial year. Budget is not merely an estimate of revenue and expenditure. It is the record of past performance, a method of current control, and a projection of current control and a projection of future plans. It is overall plan of action.

The Budget is central to administration. The scope and nature of the entire governmental operations is determined by budget proposals. Budget serves a number of purposes etc. Budget provides an opportunity for evaluating programmes and policies. Programme evaluation is important for the reformulation of plans and programmes. The P.P.B.S. is an example of the total integration of budgeting and planning. Budget is an instrument of public policy i.e. socio-economic policies. By imposing heavy taxation upon articles of consumption, it is encouraging investment, and thus promotes economic growth of the country. Through progressive taxation i.e. higher taxation for rich or more tax on luxury items and lower on exemption for poor, it can mitigate economic inequalities. It also helps in correcting regional imbalances.

Budget is the most important tool of legislative control over the public purse, and thus, the executive. Legislative control signifies that no tax can be collected without its prior authorization and no expenditure incurred without its prior approval.

All the above facts show that Budget is a tool which serves many purposes.

Answer : Budgeting and fiscal administration is broadly concerned with raising and spending financial resources and public debt operations to influence the economic activities of the community in desired ways. It is also concerned with the allocation of resources between the public and private sectors and their use in accordance with national objectives and priorities. It aims at using its three major instruments – taxes, public expenditure and public debt – as balancing factors in the development of the economy.

Budgeting and fiscal administration presume the identification and clear recognition of the institutional aspect of government finance, such as tax system, their incidence and shifting, budget formulation and execution, and financial administration. Public administrators on their part of budgeting and fiscal administration require to resolve a variety of operational, management and strategic issues like, rate of capital formulation, balanced growth, economic and social overheads, control of inflation, progressive tax structure etc.

In order to promote and sustain economic development, the capital formation has to be much higher than that prevailing in most of the underdeveloped countries. A high rate of economic growth sustained over a long period is an essential condition for achieving a rising level of living.

Again, public administrator has to take care of balanced growth of economic development. A prime feature of the economic scenario in the developing countries is their excessive dependence on agriculture rather than on industries and other non-agriculture occupations.

Next, fiscal policy has to be so formulated that adequate resources are available to the government for funding social expenditure, which benefit the poor. Heavy instruments have to be made in infrastructure for sustaining growth in agriculture and industry. The development of transport and communication, water management and irrigation projects, large-scale investment in health and education, cannot be left to the private sector. Again last but not least, an appropriate budgeting and fiscal administration can help in controlling inflation. A non-inflationary financing of planned development will require a greater reliance on surplus generated by the budget and public sector undertaking and a reduced dependence on borrowed funds. Fiscal policy must also, ensure that taxes, as levied, are fully collected and strong action is taken to curb tax evasion.

Answer : In administration we use often few terms interchangeably due to matching of the subject in some sense but in pure form these subject matter are differ to each other in their sense like, “Program budgeting” and “Performance budgeting” seems to be similar to each other in terms of their relative theory. Program budgeting denotes an Administration of certain program, function or any institutional set up and authorize some persons with certain work, to manage and balancing the works into proper way is another subject matter of a program administrator. So, ultimate aim of a program budgeting is to manage the functional environment or any work authorize to administrator due process, financial balance is also needed.

“Performance Budgeting” on the other hand shows slightly differ to program budgeting, it contains a meaning of Human-Resource Management and Administration of People giving him the work which are suitable to their nature and skill that’s only the work would be in proper way, the performance is the ultimate goal of administrator, through Functional Specialisation. We see also that there differences may be theoretical also in Practical Purview. Program budgeting always demands performance budgeting because of interdependence to each other, and practically speaking any program can not be new properly because of distribution of work out and performance of human skill.

So, we can say that in theories - these two concept has definite meaning but practically they are interchangeable to each other.