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Zero Based Budgeting
(redirected from zero-based budgeting)

   Also found in: Wikipedia 0.01 sec.
Zero Based Budgeting
A system of budgeting where each department or division of a company must justify all expenditures and allocations rather than simply increases over the previous fiscal year. That is, the budget is made with every department starting at zero dollars to spend, and each department must demonstrate need for what it wants to receive. Zero-based budgeting is advantageous because it is more detail-oriented than other forms of budgeting; among other things, it makes it easier to detect and eliminate over-inflated budgets. On the other hand, zero-based budgeting is more difficult and time consuming to put together and often has a bias toward departments that directly produce revenue instead of departments like R&D.


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Zero-based budgeting and creating a public debt management office for the implementation of debt management strategies and risk are other key tasks of the department.
Martin Manetti, partner and managing director of BCG, said: "We will introduce a zero-based budgeting approach, instead of using the current incremental budgetary approach.
This can be achieved by zero-based budgeting in all major departmental service expenditure, a freeze on senior officers and all councillors' salaries, and all other financial economies in inter-departmental expenditure used to peg any increases to council tax.
 
 
 
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