Consult this publication on line at

A typology of spending reviews and performance evaluation
P
r
ima
r
y objective
A
n
aly
s
i
s
: a
n
aly
s
e ma
n
ageme
n
t, 
s
t
ru
ct
ur
e
s
a
n
d/o
r
policy to imp
r
ove efficie
n
cy a
n
d 
effective
n
e
ss
C
r
eate fi
s
cal 
s
pace: 
r
eallocate a
n
d/o
r
r
ed
u
ce gove
rn
me
n
t expe
n
dit
ur
e fo
r
p
r
og
r
amme
s
o
r
o
r
ga
n
i
s
atio
ns
S
pe
n
di
n
g Review
s
Pe
r
fo
r
ma
n
ce eval
u
atio
n
(p
r
og
r
amme, policy o
r
o
r
ga
n
i
s
atio
n
al 
eval
u
atio
n
)
Efficie
n
cy 
r
eview
s
P
r
ima
r
y c
r
ite
r
ia: efficie
n
cy - Ide
n
tify how the 
exi
s
ti
n
g policie
s
ca
n
be co
n
d
u
cted with le
ss
r
e
s
o
ur
ce
Example
s
:
Fi
n
la
n
d “P
r
od
u
ctivity P
r
og
r
amme”(2005-15)
Ko
r
ea “
S
elf-A
ss
e
ss
me
n
t of the B
u
dgeta
r
y 
P
r
og
r
amme” (2005-)
S
t
r
ategic 
r
eview
P
r
ima
r
y c
r
ite
r
ia: efficie
n
cy & p
r
io
r
iti
s
atio
n
– 
Ide
n
tify what the gove
rn
me
n
t 
s
ho
u
ld o
r
s
ho
u
ld 
n
ot do
Example
s
:
A
us
t
r
alia “Comp
r
ehe
ns
ive expe
n
dit
ur
e 
r
eview
s
”; “
S
t
r
ategic 
r
eview” (2007)
Ca
n
ada “P
r
og
r
amme Review” (1994); 
“
S
t
r
ategic Review” (2009)
De
n
ma
r
k “
S
pe
n
di
n
g 
r
eview” (o
n
goi
n
g)
Nethe
r
la
n
d “I
n
te
r
depa
r
tme
n
tal Policy 
r
eview” 
(1982; 2009-p
r
e
s
e
n
t)
UK “
S
pe
n
di
n
g Review” (1998-p
r
e
s
e
n
t)
Source:
OECD (2013).

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BUDGET REVIEW: GERMANY
OECD JOURNAL ON BUDGETING – VOLUME 2014/2 © OECD 2015
42
3.4.1. Introducing a spending review mechanism
Performance-related budgeting, however, is not a reform that can be implemented
alone. A more general difficulty is that the annual budget process, which now operates
steadily within the medium-term constraints embodied in the Financial Plan, allows
limited space for considered re-appraisal of the overall priorities of government, and for
the re-evaluation of the existing stock of expenditure to identify fiscal space whereby these
newly-emerging priorities may be accommodated. The process of forming a Coalition
Agreement appears effective in identifying high-level priorities; but it is not clear that the
existing processes for re-casting expenditure to match these priorities and to adjust them
over time are equally effective.
It should be added that such priorities are not only the short-term topics that may arise
on the political scene at any time, but longer-term issues – such as those associated with
long-term demographic change – which require a well-considered response and which may
entail some far-reaching adjustments to existing patterns of resource allocation and use.
Having regard also to the decentralised tradition of the German federal system, it may
be advisable for the German authorities to consider supplementing the existing budgetary
process with a structured, institutionalised spending review process. (Indeed, a spending
review process is envisaged for the federal level in the current Coalition Agreement adopted
in late 2013.) Such a mechanism would allow ministries, and government as a whole, to
confront more directly and systematically the challenges of budget prioritisation that arise
under a binding budget constraint and a top-down approach to resource allocation. Box 9
below presents one example of how such a mechanism might be designed to fit within
Germany’s federal budgeting system, showing also its potential inter-linkages with other
budgetary reform themes. 
Box 9.