In a state health department, instead of basing next year's budget on last year's figures plus an increment, every programme must justify its entire allocation afresh each year, starting from a base of zero. This budgeting technique is called:

• A Zero-based budgeting ✓
• B Incremental budgeting
• C Programme budgeting
• D Performance budgeting

Explanation

Zero-based budgeting requires each activity to be justified completely in every budgeting cycle from a zero base, without assuming continuation of previous funding, which forces review of low-priority programmes. Incremental budgeting, by contrast, adjusts prior year allocations marginally. Programme budgeting allocates funds by objectives or programmes, and performance budgeting links outlays to measurable outputs, neither of which mandates a fresh justification from zero.

Reference: Park's Textbook of Preventive and Social Medicine, 27th ed.

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