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Canada primarily uses a combination of traditional budgeting models, including incremental budgeting, zero-based budgeting, and program-based budgeting, with an increasing emphasis on results-based and outcome-based budgeting.

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                                     OVERVIEW

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                                     OVERVIEW

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(4) Centralized Coordinating Body Organization

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(4) Centralized Coordinating Body Organization

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New administrative and financial processes are imperative, and knowledge-sharing on best practices can expedite the learning curve for newcomers while fostering the creation of additional Outcomes-Based mechanisms.

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Strong data infrastructure that supports accurate and timely data collection, management, and analysis is essential to measure performance and outcomes effectively. Ensuring relevant data is shared across departments and agencies enhances collaboration and provides a more comprehensive view of performance.

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Establishing mechanisms to obtain regular feedback from these stakeholders helps refine goals, improve processes, and ensure accountability. This collaborative approach helps build consensus and fosters a shared commitment to achieving desired outcomes.

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(3) Multi-level, Sustained Government Support

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(3) Multi-level, Sustained Government Support

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The involvement of government leaders ensures that the practical aspects of OBB are managed effectively and that the transition to this new budget approach is smooth.

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Crime Reduction

Unemployment Reduction

Improved Access to Education and Healthcare

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2)Enhanced Financial Standing and Reduced Debt

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2)Enhanced Financial Standing and Reduced Debt

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Promotes efficient and effective resource use

Leads to better financial health

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Management, Resources and Results Structures (MRRS)

Program Activity Architecture (PAA)

Performance Measurement Framework (PMF)

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Assess deputies' ability to:

Deliver outcomes

Manage morale

Reduce employee turnover

Improve quality of management skills

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Gradual implementation

Minimized disruption

Continuous improvement

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Breaks down departmental silos

Facilitates shared outcomes

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Canada’s adoption of OBB reflects a recognition that various outcomes, such as citizen satisfaction, environmental impact, and alignment with values measure government success. The public sector operates with a clear mandate to deliver tangible outcomes, ensuring that government activities and budget allocations are directed toward achieving specific, measurable results.

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Canada’s approach to OBB is characterized by its adaptability, acknowledging that implementation varies across different areas of public spending. This flexibility allows for tailored budgeting strategies that address the unique needs and challenges of different sectors.

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This evidence-based approach ensures that decisions are grounded in objective information, leading to more effective and efficient use of public funds.

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Canada looks at various indicators to measure success, not just financial ones. For instance, transportation projects are judged by how well they reduce traffic, improve air quality, and satisfy the public, not just by how much they cost. This helps ensure that public spending is effective in many ways.

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(9) Emphasis on Transparency and Accountability:

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(9) Emphasis on Transparency and Accountability:

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This approach ensures that government spending is aligned with national priorities and provides clear metrics for evaluating the effectiveness of policies and programs.

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1. )   Essential System of Implementation

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1. )   Essential System of Implementation

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Service providers implementing Outcomes-Based models need effective governance, solid data infrastructure, adaptability. Strict measurement processes can limit providers' ability to adjust, hindering desired outcomes. Sharing data is challenging due to legal, regulatory restrictions.

Case study : Canada's Homelessness Management Information System (HMIS)

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An Outcome Owner is crucial for ensuring outcome realization, holding responsibility for taking necessary actions. The ownership is tied to a position to ensure continuity, rather than a person, and must have authority to act. Active accountability through refined position descriptions and job performance metrics is essential for successful Outcome Management.

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3.)   Lack of Performance Management System in Place

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3.)   Lack of Performance Management System in Place

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Performance management is essential for monitoring, evaluating, and achieving desired outcomes. It aligns budget allocations with strategic goals and helps in making informed decisions about resource allocation. Challenges for organizations without a performance management system include :

a.) organizational resistance

b.) lack of tracking mechanisms

c.) distrust of systems

d.) technological impediments

e.) debates over appropriate measures.

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Outcome-Based Budgeting (OBB):

Focus: Achieving specific, measurable outcomes

Approach: Strategic and goal-oriented

Data Use: Robust data collection; comprehensive performance metrics

Accountability: High transparency; regular progress reporting

Flexibility: Adapts to changing needs and priorities

Resource Allocation: Based on effectiveness and results

Example: Aligns spending with national priorities and SDGs

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Focus: Cost control and budgetary limits

Approach: Process and input-oriented

Data Use: Historical spending patterns; less performance focus

Accountability: Ensures departments stay within budgets

Flexibility: Limited; less adaptive to change

Resource Allocation: Based on past expenditures

Example: Incremental adjustments without thorough outcome evaluation

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Outcome-Based Budgeting (OBB) vs. Traditional Budgeting

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Outcome-Based Budgeting (OBB) vs. Traditional Budgeting

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(10) Performance Measurement and Evaluation

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(10) Performance Measurement and Evaluation

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Canada has a strong system for measuring and evaluating performance. Federal departments report yearly on their progress towards meeting their goals. This ongoing evaluation helps make sure that public spending stays aligned with national priorities and can be adjusted as needed.

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4.)  Lack of Understanding and Awareness

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4.)  Lack of Understanding and Awareness

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the main among them being an information vacuum that affects the public and government.

incorrect information and inaccurate assumptions that Outcomes Based-Finncing supports the closure of social services are partially accountable for this shortage.

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5.)  Data Systems and Performance Measurement

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5.)  Data Systems and Performance Measurement

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to monitor and assess results, these data-related challenges must be addressed by investing in

1. robust data systems

2. improving technical capacity

3. ensuring data quality and consistency

integrating fragmented data system collection and analysis.