Budgetary Incrementalism In Canada

Budgetary incrementalism is the traditional budget process in Canada, referred to as line-item budgeting. In this approach, the budget lists a line-by-line list of expenditures to be paid by a department or agency in a given year. This system is decentralized, and develops from the bottom-up. This system is about maintaining establishes responsibilities and keeping with existing policies and goals. Current decisions should be based off past decisions, and it should be as simple and easy as possible. Changes should be small in nature and should not occur at once, instead occurring slowly over time.

Rationalism, as it relates to the system of budgeting is when program spending is systematically linked to program planning, prioritization, development,

1 The systems intended purpose was the integrate the policy-planning and budgetary process, focusing on improving service delivery to Canadians. It was supposed to be a management tool to provide a better analytical basis for decision-making. Certain agencies were to set priorities, which departments budgets were to align or contribute to those priorities. The system failed because it incorporated information that was hard to obtain, gauge and demonstrate. The system was augmented with Management by Objectives (MBO) and Operational Performance Measurement Systems

Governments aim to use rationalism as their guiding principle but often end up falling for bounded rationalism, a middle ground between them. The strategic planning, aligning priorities and undertaking a cost benefit analysis are all time consuming steps, that require lots of deliberation. Implementing this across all governments departments and agencies for a yearly budget would be a missive undertaken and not realistic given all the constraints. That is often why governments settle for a middle ground between the two, they aim for budgetary rationalism but end up between rationalism and