March 27, 2015
The Budget performs five key functions in a County.
Allocation function: The Budget guides the development process in the County through resource allocation.
Distribution function: The Budget ensures balanced distribution of the County’s resources and that wealth is realised through identification of sectors that need renewed focus and affirmative action.
Stabilization function: The Budget helps to attain and maintain a desired level of economic performance in the County. There are some desired levels of stability that citizens require.
Fiscal transparency: The Budget ensures transparency, especially in the manner in which public expenditure is managed. Public information provides a clear reflection of the Government’s expenditure priorities. It, therefore, forms a basis through which citizens can challenge the County Executive over its stated policies and public announcements.
Control function: Budgets are useful because they provide a basis for evaluating performance. Performance evaluation is carried out by comparing actual performance with planned or budgeted performance. The causes of significant deviations from planned performance can then be identified.