The New International Encyclopædia/Budget

BUDGET (Fr. bougette, bag, wallet, dim. of OF. bouge, a leather bag; hence a bag with its contents, as e.g. of news, information; cf. Lat. fiscus, originally basket, then money-basket, then public treasury). In its primary significance a term which designates the periodical financial statements laid before a legislative body. As such it embraces the report of receipts and expenditures for a prior fiscal period, and an estimate of the receipts and expenditures for a future period. From these preliminary estimates, which are the basis of legislation, the term has been extended to cover the aggregate of legislative enactments relating to the receipts and expenditures of a given period. The method of preparing and voting the budget varies greatly. An ideal budget would calculate revenue and expenditure with such nicety as to bring about an exact balance; but such precision is practically impossible except when the revenue system by its elasticity permits an adjustment of income to expenditure.

In England the Chancellor of the Exchequer submits to Parliament an annual statement of the expenditures deemed necessary by the Government. He is responsible for the entire expenditure, both in the departments of other ministers and in his own. It is therefore his duty to harmonize the estimates of the several ministers, and in so doing he may curtail the appropriations requested by some of his colleagues. The revenue as a whole is fixed and is not voted annually by Parliament. Yet it is the practice in England to regard the income tax and the tea duties as variable elements to be increased or diminished, as occasion arises. Proposals for such changes are an essential part of the budget.

In the United States the budget is practically prepared in the House of Representatives. To the latter at the opening of each session of Congress the Secretary of the Treasury submits a book of estimates of expenditures to be made for the coming fiscal year. He transmits without revision the estimates made by the several Cabinet officers, and the heads of offices not directly subordinated to the eight executive departments. These estimates form the basis upon which the several appropriation bills are prepared by the committees of the House of Representatives. This the work of preparing the budget is decentralized, and the adjustment of expenditures to income which results is not so satisfactory as in other countries. Although the term ‘budget’ is a component part of parliamcntary language, it has not come into common use in the discussions of Congress. Consult: Wilson, The National Budget (London, 1882); Adams, Finance (New York, 1900). See Finance; Tax and Taxation; Debt, Public.