Elaborate the objective of ‘allocation of resources’ in the Government budget.

Question 11:Elaborate the objective of ‘allocation of resources’ in the Government budget.

The correct answer is – The objective of the allocation of resources in the Government budget is to allocate the available resources of the government towards various economic sectors and projects to ensure efficient and effective use of resources. The government budget is a tool used by the government to manage the economy, to control inflation, to stimulate economic growth and to create employment opportunities. The budget consists of two main components, namely revenue and expenditure. The allocation of resources is a critical component of the expenditure aspect of the budget.

The primary objective of the allocation of resources in the government budget is to promote economic development by allocating resources towards projects that have high economic and social returns. This means that the resources are allocated towards the projects that have the potential to generate the highest possible benefits with the least amount of cost. For example, the government may allocate resources towards education, healthcare, infrastructure, and other productive sectors that contribute to economic development.

Another objective of the allocation of resources in the government budget is to achieve social equity and ensure that the benefits of economic development are distributed evenly across different segments of the society. The allocation of resources towards social services such as education, healthcare, and housing can help to reduce income inequality and improve the quality of life for the most vulnerable segments of the population.

Additionally, the allocation of resources in the government budget aims to achieve macroeconomic stability by allocating resources towards projects that can help to control inflation, balance the budget, and manage the overall economy. The government may allocate resources towards projects that create employment opportunities, reduce trade deficits, and encourage investment, to stabilize the economy and promote growth.

In summary, the objective of the allocation of resources in the government budget is to ensure the efficient and effective use of available resources, to promote economic development, achieve social equity, and ensure macroeconomic stability.