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As far as I know, most countries write up budgets like they write laws: organs of government declare what they need for the next year, someone makes a proposal, and other people add to the proposal, negotiations are made to fund this in exchange for that, all the proposals are added together, and then the entire electorate or legislature vote up or down the whole thing. I was curious if there is some definition or theory in political science for a system where a list of budgetary needs is proposed to the voting body as a series of line items that each individual voter can allocate a certain funding amount or percentage to, then a calculation is made to determine the final budget.

I don't know how to explain this better than an example. Absolute amounts spent are irrelevant. Let's say the government budget has three line items and there are three voters. Voters can be members of parliament, some committee, or the general public.

Voter 1's choices:

  • Item A 10%
  • Item B 90%
  • Item C 0%

Voter 2:

  • Item A 1%
  • Item B 20%
  • Item C 79%

Voter 3:

  • Item A 5%
  • Item B 75%
  • Item C 20%

The Final Budget, using a simple average of each participating voter's choices:

  • Item A 5.33%
  • Item B 61.67%
  • Item C 33%

What is the name of such a system, is it or was it ever practiced anywhere, at any scale? If not, why not? (simple lack of precedence? complexity? inherent flaws?)

I would also accept examples of systems that use simple choice-ranking for budget items. So voters just prioritize budgetary items and something else is used to determine actual funding. I don't care about the calculation used. (which should probably vary depending on the voting body size) This system is independent from whatever process exists to choose budget items in the first place or figure out how much total funding is available.

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Do any countries practice a system of proportional funding/budgeting that combines everyone's funding choices?

Apparently, not. In the cases I have found, the budget is given by the executive and possibly amended by the legislature. Only, in Budget-making legislatures could the legislature use such a method, and there is no evidence to indicate that any do so.

The legislature’s capacity to influence budget decisions is a function of both its authority over executive budget recommendations and its internal processes for decision making. With regard to the scope of legislative authority, Wehner (2004) places legislatures into three categories of influence over budgeting:

  • Budget-making legislatures have the capacity to amend or reject the budget proposals of the executive and to substitute one of their own (Sweden, United States).
  • Budget-influencing legislatures can amend or reject executive budget proposals but lack the capacity to formulate their own independent budgets (Italy, Netherlands). The amending power is often constrained as well: many legislatures may cut but not add to executive budgets, while others may add as long as they find offsetting cuts.
  • Legislatures with little or no budget role lack the capacity to reject or amend executive proposals in any substantive way, largely for fear of prompting the fall of the government (United Kingdom). 1

Such a system would be impractical for any government of size due to level of expertise required and the number of line items that must be considered. Individual legislators do not have the expertise or time to examine the complete budget of a country in order to make an informed decision regarding the allocation of funds.

In budgetary matters, the legislature can receive technical and analytical support from either: (1) an independent nonpartisan parliamentary/congressional budget office; or (2) a limited number of officials (possibly, but not necessarily, civil servants on secondment to parliament) who provide analytical support to the budget committee or other parliamentary committees. Thirteen OECD countries have established some form of specialist budget office attached to the legislature. Recently-created ones, such as those in Canada, Korea, and Mexico have been influenced by the USA’s Congressional Budget Office (CBO), created by legislation in 1974.

Countries’ parliaments have established nonpartisan budget offices for four main purposes:

  • Provide budget analysis and independent advice to parliamentarians from both the majority and minority parties represented in the legislature.
  • Provide the legislature with medium-term fiscal projections and scenarios that may differ to those prepared by the government.
  • Quantify the impact of alternative new tax or spending policies, especially (but not exclusively) on the budget for the forthcoming new fiscal year.
  • Remedy the lack of time and analytical capacity that elected representatives have to analyze the details of draft budgets and to propose alternative budget policies. 2

Table of government line items. 2

Table of government line items

I would also accept examples of systems that use simple choice-ranking for budget items. So voters just prioritize budgetary items and something else is used to determine actual funding.

One possibility is Zero-based budgeting (ZBB).

For most of the United States government, the main users of ZBB are the legislative, executive, and the agency. The legislative includes the congress, state legislature, and city council, and they require more summarization and focusing on public priorities and objectives. Agencies include the agency director and department managers and they require more detailed information and focus on program implementation and efficiency. Lastly, the executive includes the President, governors, mayor/city manager and they focus on the needs of the legislature and agency. 3

The origin of ZBB has been traced back to at least 1924 and probably goes back much further. As early as 1962, the Department of Agriculture used a variant of ZBB to formulate its fiscal year 1964 budget estimates. However, branded as a failure, the process was abandoned until the late sixties when a modern version of ZBB was successfully used by private businesses. Its success has provided the impetus for numerous States and the Federal Government to adopt the concept in the seventies.

Under the modern version of ZBB as portrayed in the literature, allocation of funds among activities takes place through a process involving several steps.

First, the activities of the organization which need or request resources are identified. These activities are usually referred to as decision units. For example, a decision unit could be an alcoholism program, the reproduction of pamphlets, or research and development on a specific product line. Second, decision packages for each decision unit are prepared. Decision packages contain:

  • the goals or objectives of the activity,
  • the consequences of not performing the activity,
  • alternative ways of doing the activity, and
  • alternative levels of effort and spending to carry out the activity.

Once decision packages have been prepared, they are ranked in descending order of importance and sent to the next higher organizational level. As decision packages are sent up the organizational ladder, the manager of the next level may consolidate the rankings of the various programs or activities for which he or she 1s responsible. This process continues until the senior management level (In the case of the Federal Government, the President and his staff) produces the final ranking. Through this ranking process, scarce resources are presumably budgeted in an efficient manner. 4

Within ZBB, a Budget-making legislature could review all the packages produced and amend the executive's budget to change the priorities.

What is the name of such a system, is it or was it ever practiced anywhere, at any scale? If not, why not? (simple lack of precedence? complexity? inherent flaws?)

The inherent flaw in proportional allocation by the legislature may be seen in the context of ZBB. If a "package" requires X amount and the legislature allocates less than 100% of the required amount, the goal(s) identified in the "package" cannot be met. If the legislature allocates more the 100%, the excess budgeted amount is wasted.


1 Role of the Legislature in the Budget Process: Recent Trends and Innovations

2 Role of the Legislature in Budget Processes

3 Zero-based budgeting

4 Streamlining Zero-base Budgeting Will Benefit Decisionmaking (download)

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I don't think so and I think it would both unduly complex and potentially irresponsible/unethical to do so.

The unduly complex has been covered by others. Let's move to the unethical and to do so I'll take you back to the 80s when AIDS/HIV first came to light and had a massive, massive, stigma associated with it. For example, people attempted to bar HIV-positive people from workplaces or going to schools. All in the interest of public safety of course.

The public sentiment was highly critical*, for reasons of fear, anti-gay discrimination, STD shaming, etc... and it took repeated court cases to bring some level of sanity back to, if not the public discourse, at least attempts at enforced quarantines.

Now, imagine that you are a country's public health authority and you request $500M for HIV/AIDS research and support for the coming budget.

Voters 1, 2, 3... and so on would have basically said "$0 for these people. it's their fault".

In the meantime, any number of popular but trivial causes would have been fully, if not over-, funded.

Budgets should be decided based on practical and ethical considerations and rational prioritization, not as popularity contests. Voters can always remove governments whom they perceive to be spending in the wrong areas and that is, as a matter of fact, a frequent reason elections are lost.

* BTW, not trying to shame anyone, these were scary times and people did eventually adjust. This is just an example of strong negative public sentiment on a critical area.

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    I'm not sure I understand this critique. Under a typical 50% wins democratic system then as long as less than 50% of the population supports AIDS victims, then the research doesn't get funded at all. This is textbook tyranny of the majority, a problem all systems that include democracy suffer from. Under this new system, as long as some people care, then AIDS research gets at least some funding. This seems to mitigate tyranny of the majority, not expand it. – lazarusL Feb 19 at 18:07
  • I don't understand your point. Since there was no such clever system in the 80s, health research for AIDS did get passed into budgets, because people didn't get a say into every little bit and piece of spending. So there was no "tyranny of the majority", which might very well have happened given this system. – Italian Philosophers 4 Monica Feb 19 at 18:11
  • I see now, you're saying most things should be handled by expert technocrats who don't have to answer to popular opinion. We need a little less democracy, not more power to the people. – lazarusL Feb 19 at 18:35
  • @lazarusL don't put words in my mouth, please. that's not what I said. if you feel like writing your own answer, I am not stopping you. – Italian Philosophers 4 Monica Feb 19 at 19:05
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    Thanks for your opinion and perspective, but I must agree with lazarusL. Whatever conditions allowed health research funding to pass despite lack of public support, there is no evidence that it was due to not using proportional budgeting (which nobody uses), or that it would have been stopped by that system. It stands to reason that proportional budgeting might guarantee some funding for unpopular initiatives. – Z. Cochrane Feb 20 at 18:34

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