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3.4. Resource allocation and prioritisation: Summary assessment
As indicated above, the use of performance information in the budget process within
Germany is at an under-developed stage relative to other OECD countries, although reform
processes are moving in the direction of a presentational approach with which
parliamentarians can feel comfortable. As outlined in Section 6, parliament has an intimate
engagement with the details of the financial allocations during the budgetary phase, and
in the past that institution has been resistant to changes that would alter this familiar
relationship. If the budget process is to serve the interests of citizens in promoting
transparency and efficiency regarding the use of financial inputs, it is necessary that the
strong tradition of financial scrutiny be balanced – within the Federal Ministry of Finance,
within line ministries and within parliament – with attention to the nature and quality of
the corresponding non-financial outputs.
Given the strong autonomy of ministries under Article 65 of the Basic Law, it is not
necessarily within the power of the Federal Ministry of Finance to devise national
programme-based or performance-related frameworks whereby to structure the financial
information, or to impose them within the budget document. However, the reform course
upon which the Federal Ministry of Finance has embarked holds promise that the value of
targeted performance information can prove its worth to parliamentarians, and that
progress towards a modern performance-informed budgeting system can be advanced. A
collective government-wide impetus towards greater transparency on these fronts, and

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support from the Federal Chancellery, would also be effective in overcoming bureaucratic
resistance from within line ministries. 
It can certainly be argued that the marked autonomy enjoyed by line ministries and
executive agencies should properly be matched with greater performance management
capacity to demonstrate that resources are being used effectively and efficiently. Experience
across the OECD indicates that efficiencies are most readily realised at the levels of line
administration and implementation. The work of the Federal Court of Auditors, which is the
chief independent resource for identifying inefficiencies, could also be developed more
systematically within the management information systems of ministries and their agencies
with a view to highlighting good and bad performance (see Section 4.2).
Any reform of the budgetary framework needs to take into account the strength of the
line departments and the support they receive from their respective parliamentary
committees. A number of countries, notably in Scandinavia, emphasise a “bottom-up”
approach to performance information that may be relevant for Germany. In addition, the
UK has increasingly emphasised the need for line ministry support for the use of
performance information and in the Netherlands, the direct link between funding and
performance has been downplayed. There should consequently be good examples that
Germany can take inspiration from.
In countries that emphasise a bottom up approach relatively few mandatory rules for
the use of performance information in the budget process have been set, as is the case in
Germany. Instead the emphasis has been on setting an overall framework in the sense of
requiring a few performance measures in the budget documentation and an annual report.
The content, the targets and the measurements are up to the line departments. To ensure
ownership, the performance framework must be viewed as adding value to the core work of
the line department. This will often mean that performance information that is relevant to
the operational, agency, level of the departments will be what is primarily produced. While
this may not be the most relevant level for the Federal Ministry of Finance or the parliament
it does ensure that it is relevant to the operations on the ground. Table 2 below gives some
examples of approaches that have been seen as effective in other OECD countries.
Table 2.