PA605Asst5

Colorado Technical University

Budget and Public Finance

Nana Lawson

Individual project unit 4

July 31st 2019

BUDGET AND PUBLIC FINANCE.

Finance and budgeting are essential to public administration since it involves spending and transparently allocating public dollars. Managing funds mostly involves budgeting and understanding public reaction (Simon, H. A., Smithburg, D. W., & Thompson, 2017). Financial resource availability shapes many of the outcomes that matter to public administration including the effectiveness of public service, undertaking management reforms, performance implications and decisions to pursue. In 1988, the chamber of deputies changed the procedures regulating the budget session to control the formation of public needs.

The current financial crisis of our world today has forced organizations to cut budgets, reset priorities, restructure services and assume new financial responsibilities. This reminds us of the centrality of financial resources management to the public service. Budgets help in laying a foundation for the achievement of goals. When we focus on public finance, political, economic, legal and administrative aspects of public finance are examined.

Budgeting is not an easy process as it may seem and it involves many things. Many issues are involved when it comes to budgeting and public finance. Each budgetary decision made impacts various parts of a community that mainly depend on the government. For instance, looking at the day today ever-rising population, limited resources are a major factor when budgeting due to the large percentage of people existing in a world that has limited resources not enough to sustain them all.

Communication has also become an issue when we consider budgets. Just as many people say, communication is the key to success. For continuity to take place, communication must be considered. When we look at our world most communication mostly takes place through online services which mostly involves lies and corrupt activities. This hinders the budget and public finance process since almost everything relies on new technology.

Change of culture has also become a hindrance when we look at the differences between then old and new centuries since this century involves a lot of things. Infrastructure comes in since dealing with infrastructure and finding the way to invest in it with revenues that are not growing at the same rate as costs are hard.

Vision is also an issue since the government lacks an up straight vision on where the community is going. The government and its staff majorly base on obtaining power, being the best which makes it hard to budget (GrReed, B. J., &Raudla, 2010). This is because, when we focus on a vision, it becomes easier for budgeting since we can know what needs to be done, the requirements needed and all that easily based on the vision which will help to direct us to a successful budget.

Increasing citizen demands is also an issue when we consider the available limited resources due to high population plus the basic needs of humans. This is a hindrance in that everyone is supposed to be considered when it comes to budgeting as citizens of a country. Since a lot of people are involved, a lot of demands will be available making it hard to budget considering every person's wishes. On top of that, local government staff has staffs that are not ready to inform the people of the scarcity of resources.

Balance is the most common problem due to the incapability to be able to budget between the available resources, public demand, and many others. To have a satisfactory budget, we must consider all these factors to ensure success. Since limited resources are available, it is hard to prepare a budget fixing every single detail.

Sustainability which is rarely practiced is also an issue for as they say it is better to respond to something when you have the time to fix it. Citizen perception which helps in understanding citizens and determining the step forward when it comes to budgeting for them has also become a hindrance due to corruption and fight for power. There are many other issues involved when it comes to budget and public finance involving minor which are barely noticeable and the major ones which I have briefed.

Looking at the case like the United States which faces a global financial breakdown, is a good example illustrating the issues associated with budgets and public finance in public administration. Student debts are high and unemployment rates look much like in 2007 due to overspending. For about 50 years the budget of the United States has been on cash deficit. In 2015, a federal government-runs cash deficit of $438 billion after collecting $3250 billion in revenues and spending $32668 billion hence rise the public debt from 33.7% to 73.6% of gross domestic product which is a major increase.

The GASB is one of the models used by American governments to generally solve longer-term budgets. Tens of thousands of local governments are focusing on implementing the GASB statement 34. The GASB undertook to redesign the model of GAAP which mainly focused on solving short term collections due to the belief of the power of tax (Sage Publicationsuber, 2016). The GASB did a lot of improvements by majorly focusing on much longer-term budgets rather than short term making it easier to approach the visions of a country by setting a clear budget based on very many considerations.

Budget formation takes place within the executive and involves departments submitting their budget authorities like Ministry of finance or treasury to come up with an agreement on how funds will be allocated. Once the budget is drafted, the legislature has to approve all public spending and taxation in public finance. CSOs help legislatures in clear understanding of the issues relating to the budget for better decisions. Funds are distributed as per the approved budget after adjustments caused by uncertainties. Government account and financial statements are audited. Legislatures now use insights gained from audit reports to draft future budgets.

When we talk about budgets and public finance many questions are involved when considering public administration (Peter Lang. Swain, 1997). These questions may be like, what is budgeting? What is public finance? The involvement of public finance and budgeting on public finance? Risks involved in budgeting? The reaction of the government on stopping drain due to too much spending? How to maximize available resources to fit in with the budget? Minimum wages and public finance? Tax burden issues? How to deflate tax revenues and many more.

Considering these questions, my data collection strategies majorly based on surveys which are most commonly used, easy to use and fast. This is because most people today majorly drive their focus online. Social applications like Facebook are the most appropriate to use when one wants to get a promising analysis for they are commonly used all over the world. I used a link to obtain my knowledge which I forwarded to Facebook containing questions so I can get views from all over the world.

I obtained my information from simple sampling based on the many comments I got. Many comments were interrelated, some were not understandable, some positive, some negative and many other types. Since it is a diverse topic, based on the questions I got, the response was promising due to the different understanding of the questions per person. Some responses led me to look at another direction on my questions and get different perspectives on the topic.

According to my research, I was able to see many perspectives on budgets and public finance. Public finance and budgeting is a very large area since it involves citizens, business organizations, the governments, particularly all people in a country since it consists of taxes and many activities that help in the running of the country. Budgets are majorly involved in developments and majorly help in focusing on visions that help in development making them important.

Public administration majorly involves the budgets and public finances helping countries in their long run to development for countries at all levels either developed, developing or undeveloped. Each country has these budgets, focusing on achieving a vision and goal and also to help in the running of activities in the country to maintain order within a country and also making the country work as a team and supporting each other.

REFERENCES

Simon, H. A., Smithburg, D. W., & Thompson, V. A. (2017). Public administration.

GrReed, B. J., &Raudla, R. (2010). Constitution, public finance, and transition: Theoretical developments in constitutional public finance and the case of Estonia.

Frankfurt is Main: Peter Lang. Swain, J. W. (1997). Public finance administration.

Thousand Oaks, Calif: Sage Publicationsuber, J. (2016). Public finance and public policy.