For government to be able to function and fulfill the role assigned to it, it must collect sufficient resources and allocate and use those resources efficiently and effectively. In this regard, any assessment of the government budget cannot proceed without an implicit recognition of the integral relationship between revenue and expenditures, the two principal elements of fiscal policy. Thus, the analysis of this paper assesses not only expenditure program but also the revenue program of the President’s Budget for 2001. In particular, the President’s budget proposal is evaluated in terms of two principal objectives of a good public expenditure management: fiscal discipline and strategic allocation of resources.
On the one hand, fiscal discipline requires good revenue forecasts and aggregate expenditure controls. On the other hand, resource allocation is assessed in terms its consistency with policy pronouncements of the government. In particular, resource allocation is appraised with regards to the manner by which government expenditures are programmed across sectors and categories in order to promote overall economic growth and equity.
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