ABSTRACT
Zero-base budgeting (ZBB) rejects a previous year's budget as the basis for future resource allocation decisions. Like other performance budget approaches, ZBB seeks to maximize efficiency and eliminate waste and redundancy. But unlike other approaches, ZBB shifts attention away from a reliance on precedents established in previous budgets and focuses instead on the achievement of planned objectives. This shift is intended to emphasize the role of analysis as the basis for allocation decisions rather than subjective factors that might impede or obfuscate the process of arriving at an optimal resource distribution. Because ZBB abandons the premise that budgets are inherently incremental—that each new budget should be based upon the previous year's appropriation—it requires that every aspect of the budget be justified anew each year. As such, it has been considered by some as the most radical and controversial of all modern budget reforms.
