The information available reflects that the use of performance information (PI) in the budget process is
becoming an important tool for decision-making in order to move the focus away from spending towards
actual achievements. In the decision-making process it could act as a signalling device showing which
measures are working, and which are not. Overall, it improves transparency by providing more
information on public sector performance. Country experiences so far also showed that the shift to
output-oriented policy making is also a learning-by-doing process. The OECD^9 has developed general
guidelines for countries highlighting that there is no "one size fits all" model of performance budgeting
and countries need to adapt their approach to their political and institutional context.
2.1. Possible way forward
Good value for money is essential because of the increased pressure on public expenditures. Moreover,
government output is an important share of GDP and therefore, improvements in public spending
efficiency with the objective to maximise the output for a given amount of inputs should be high on our
policy agendas.
A continued exchange of views should allow identifying key drivers of efficiency and effectiveness. An
exchange of information and case studies based on countries' experiences could help to agree on
indicators that build the basis to draw reasonable conclusions on efficiency levels. Moreover it could lead
to a common understanding of sound principles and methods for efficiency measurements on a cross-
country basis.
Concerning specific spending items the work on data collection and availability should be improved.
This should be based on efforts by Eurostat, National Statistics Institutes and the OECD to implement
output measures in the national accounts. Progress is underway in the context of the "Handbook on
measuring Education and Health Volume Output". However, a greater effort is required to get better
input data (COFOG 2nd level). Finally, the shift from input- to output measurement in the budgetary
process can be considered as a first step towards increasing the efficiency and effectiveness of public
spending. In addition, following efforts should be taken in specific areas:
- R&D spending: the Commission services should continue to work towards identifying more
appropriate methodologies that can be used to measure and assess cross country efficiency and
effectiveness. Quantitative indicators of efficiency and its determinants could be discussed on the
basis of the results of ongoing work. - Education spending: There are already very valuable data available thanks to OECD efforts in the
context of PISA. A new dataset on PISA will be available by the end of this year. - Health spending: A better common understanding of the efficiency concept could help to facilitate
the definition of appropriate indicators.
Once a more robust methodological framework and better data have been established, an overall
assessment of the efficiency and effectiveness of public spending could be envisaged, possibly as part of
the evaluation of the Lisbon National Reform Programmes. Such considerations could also be introduced
in the evaluation of the budgetary situation in the Member States.
3. Data availability and knowledge about the composition of public
expenditures
The composition of public expenditures reflects governments' input for policy objectives, like the Lisbon
goals. However, in order to assess the achievements, more detailed and comparable data are needed.
(^9) OECD (2007)