Which statement describes Program Budgeting?

• A. A budget that links budgeting with planning and evaluation on a program-by-program basis, using cost/benefit analysis
• B. A budget focusing only on historical line-item costs
• C. A budget that sets fixed annual increases regardless of program success
• D. A budget that excludes performance data

Answer: (A)

Program budgeting ties the budget directly to planning and evaluating what each program costs and what it achieves, allocating funds on a program-by-program basis and often using cost/benefit or cost-effectiveness analyses to guide decisions. This approach emphasizes outcomes and performance data, so resources are prioritized for programs that deliver value and meet goals. It contrasts with budgeting that merely tracks historical line-item costs, which focuses on inputs rather than results. It also avoids automatic, fixed annual increases that ignore program performance and does not exclude performance data from the decision process. In short, the description that matches program budgeting is a budget that links planning, evaluation, and funding to each program, using cost/benefit analysis to inform choices.