Zero-based budgeting is a management practice that was introduced and popularized by Peter Pyhrr in the 1970s.
Most budgeting processes – especially in large firms – are based on questions of whether a particular department or function will get more or less money than they did the previous year.
Managers will use last year as a baseline and argue for where they think they should get more, or haggle with their boss and the finance department if they’re told they’ll get less.
Zero-based budgeting (ZBB) asks everyone to start afresh each budget period, and so managers must build up all of their costs for the next period and submit that as their budget. It can help finance teams and the managers they work with take a fresh and comprehensive look at how funds are used and reallocate resources to the most profitable activities.
Indeed, US presidential hopeful and former Hewlett-Packard CEO, Carly Fiorina suggests the US administration adopt ZBB .
Myth #2: ZBB budget cycles are excruciatingly long
The truth: ZBB is fundamentally designed to force managers to think hard about how to fund every function or every program within his or her control, and then document, analyze, and prioritize which ones will get funding and which ones will not.
So ZBB should take significantly longer than the traditional approach. But not according to CEB data: the average traditional budget cycle time is 69 working days, and ZBB is just marginally longer at 74 working days.
Myth #3: ZBB is a budgeting approach
The truth: ZBB is a more of a mindset than a process. Companies that are best at managing ZBB set a strong tone from the top that this is a shift in strategy versus an introduction of a new process. A zero-based mentality must permeate the day-to-day conversations that finance teams have with business partners, and that business partners have amongst themselves.
3 Myths of Zero-Based Budgeting, Gartner Inc.
Congress may have unwittingly introduced ZBB in government budgeting, starting with the CHR, ERC, and NCIP, with PHP1,000 each. This is consistent with the past administration’s financial reform of performance-based incentives among goverment employees: poor or no performance, no incentive. It’s just fair. Plus, ZBB does away with politically-motivated “priority lists”.
With CHR, one can see that, in going over it’s functions, it’s work on the following, for example, has not translated into significant change:
- Exercise visitorial powers over jails, prisons, or detention facilities;
- Establish a continuing program of research, education, and information to enhance respect for the primacy of human rights;
- Recommend to Congress effective measures to promote human rights and to provide for compensation to victims of violations of human rights, or their families.
The state of jails all over the country will break anyone’s heart. They are no place for humans. What has CHR been doing to facilitate change in this? We don’t see any third party reports.
National broadcast media have been indiscriminately showing to the public, practically anyone with a TV and internet connection, video recordings of CCTVs to bone up their news about who they report as crimimals. This is illegal, the very basis of anti-CCTV arguments because it intrudes on the right to privacy and protection from judgment without proper and fair trial. What is even more disturbing is how were they given access to the recordings, and why did owners of the CCTV system in the Metro think they’re doing the public a good turn by giving access to citizens’ data to third parties? But, above all, despite these disturbing practices there has been no word, admonition to the media companies, from CHR.
And, instead of joining members of Congress in hurling accusations left and right which they have no intention of following up in court, inadvertently revealing that the accusations are only meant to rile up public sentiments, the public has not heard news about CHR recommending, in a non-combative stance, effective policy measures to promote human rights in the country as a result of research it regularly undertakes.
I’ve read CHR reports for Philippines, publicly available on the UN site, and most in them are motherhood statements that are too-associated with campaigns pushed by personalities. came by it’s 2016 report in which there’s this statement
The government generally respected the privacy of its citizens, although leaders of communist and leftist organizations and rural-based NGOs alleged routine surveillance and harassment.
My god. We’re not a communist country so of course groups that are a threat to a republic will be routinely surveilled. What does CHR want? For this nation to give up a hard-earned republic? CHR people need to remember that for every right acted on, a corresponding right is withheld. By protecting the right of communist groups to take to the streets, you deprive the right of democracy-loving citizens of security. Where does CHR stand, with the voice of communism or of democracy? In any case, I was looking for a human rights-based analysis in the reports. Let’s take the right to basic education. The quality standards of this right include, quality, access, and availability. How is the quality of teaching, learning materials, school infrastructures, and the like? To what extent are school-aged children have access to schools? To what extent are schools available to school-aged children? To what extent is DepEd allocating resources to uphold these standards?
As to IEC on human rights, they don’t show up unless invited (meaning, expenses are paid for by the inviting party). This says so much about who their clientele are. What about the masses, the poor communities whose rights have long been overlooked and/or stepped upon? There have been no initiatives from CHR, for example, of launching a caravan of human rights educators and counselors traveling the entire year to every nook and corner unreached by electricity, television, radio, or telephone. If this will take them to rebel or guerilla lairs, well and good because these communities need to have a good shakeup around human rights issues. Christian missionaries, private citizens, were brave enough to take the road less travelled in order to educate communities not even government has reached. This should inspire CHR- to make it their mission to educate each and every Filipino on their human rights. But, none.
Same with the Energy Regulatory Commission (ERC). In 2005, ADB released it’s Sector Assistance Program Evaluation of ADB Assistance to Philippines Power Sector report from which the following risk assessment is lifted:
Fast forward to 12 years, now, the state of power facilities and supply lag behind ASEAN member-countries. The sector remain controlled by just a few the reason they are incentivized to dictate the price. And what has ERC done about this?
Lastly, what is this PHP1Billion budget the National Commission on Indigenous Peoples (NCIP) wants from taxpayers? The Philippines is probably among the countries populated with multiple ethnic minorities. Cordillerans probably have a better deal, with each ethnic group having it’s own territorial land where they basically could practice their own unique culture and governance practices. Still fundamental issues common to IPs remain: titling, poverty, recognition of their language, beliefs, and practices, ownership to indigenous inventions eg. farming technology, seeds propagation, medicines, art, music, lierature. Of the latter, NCIP could have assisted the IP communities set up a kind of community savings from royalties received from use of patented inventions. But, none. Little is known about the IPs in this country and they remain misunderstood and hidden. If not for a private individual who popularized “carrot man” many Filipinos would’ve remained ignorant of the “normal” features of “carrot people”.
So, yes, PHP1,000…until these agencies come up with the one critical thing they will do this year and show results for.