Outcome Based Budgeting System Analysis

As we know, the transparency is supposed to create the accountability. The increase in demand for a transparency and greater accountability in the use of public funds in Malaysia make the governments respond the demand by questioning on how the performance and the outcome be measured? Outcome means the result or output that the government should be achived by planning certain strategy of ongoing process and improving the performance. For example, the government manage a nurmber of reforms such as budgeting system reforms from Modified Budgeting System (MBS) to Outcome Based Budgeting (OBB) and increase productivity and efficiency in governmental operations. These reforms are used to transform public budgeting systems to focusing more on outputs

Budgeting system is the combination of methods, techniques, procedure or practice on how a budget was prepared and presented. Since 1960s until the year 2012, there are three types of budgeting system and techniques being implemented by the Malaysian government such as Traditional Budgeting System (TBS), Programme and Performance Budgeting System (PPBS) and lastly Modified Budgeting System (MBS). But starting from year 2013, the Malaysian government then implementing a new budgeting system known as Outcome Based Budgeting (OBB). The different budgeting systems have different point of view towards planning, control and evaluation for the government (Fatimah Abd Rauf, et al,

It is a tool to allocate resources effectively and efficiently in order to achieve specific target. For example, OBB explains why the money is being spent by using statements of mission, goals and objectives. It definitely differs from TBS approaches because it focuses on what the money buys and the outcome of the purchase rather than what is the inputs before purchase or how to get money for spent on something (inputs). Successful implementation of OBB must be supported by the budgeting process with the performance management process and also consistent monitoring of outcomes.

The OBB is to overcome the MBS’s weaknesses that lead to strategic integration of planning, budgeting, implementation, monitoring and evaluation in the Malaysian public sector. Malaysian government establish the OBB to emphasis on effectiveness and impact of the programme rather than on expenditure incurred and output of the programme. There are some of the objectoves of OBB are given below: (Fatimah Abdul Rauf, et al, 2015)

• Provide structural mechanism to translate policy and concept of National Transformation Programme (NTP) to overcome and results.

• Empower Controlling Officer to manage resources under their