There is a well-known saying that budgets are value statements. In reality, traditional budgeting — bringing last year’s spending plan forward and adjusting it incrementally up or down to match revenues — can result, over time, in budgets that are disconnected from the values of the people they serve. That became strikingly clear last year, when George Floyd’s death by a police officer sparked calls across the United States to “defund the police,” and political leaders scrambled to respond. Already some leaders have begun repurposing a portion of their police dollars to promote racial equity and social justice.
Local and state governments have the potential to make substantial and lasting impact in creating equity for all people in their communities, and one of the most change-making tools is their budget. Budgeting for equity may appear straightforward: organizations should prioritize spending where it makes the most impact, addresses the greatest need and repair past harms. Simple in concept, but putting it into practice is challenging. Why? Like any other bureaucratic process, budgeting perpetuates the status quo, which favors those with the most access, influence and power.
While the playbook for budgeting is evolving, there are four fundamental practices that are essential to its success: understand equity, use data and evidence, budget for outcomes and engage the community in new ways.
Budgeting for equity cannot be separated from governing for equity. It is part of an organization- and community-wide cultural shift that begins with a shared understanding of what equity means, the causes and consequences of inequity, and why advancing equity is important.
Equity is achieved when individuals’ race or gender, for example, can no longer predict their life outcomes, and outcomes for all groups are improved. Equality is about treating everyone the same, such as equal protection under the law and equal pay for equal work. Equity recognizes that treating everyone the same will not repair the effects of past harms. Those who have been historically disadvantaged may need differential treatment to reach desired levels of academic achievement, health and employment. A community looking to use public resources to advance equity must find consensus around what equity means given its own unique history, economy, demographics, current conditions and goals for the future. Achieving consensus begins by agreeing on a shared set of facts.
Use data and evidence to inform budgeting
With data and evidence, governments can pinpoint disparities, establish goals to fix them and find solutions that work. For equity to inform budgeting, governments must move from goals to strategies — the actions and initiatives that can be determined, communicated, carried out and counted. A common-sense approach to strategy development is results-based accountability (RBA), a structured, data-driven planning process that works backward, from ends to means. RBA can be a powerful tool for disrupting the pattern of “we’ve always done it that way.” RBA also combats a rush to fund well-intentioned new programs that have not been shown, with credible evidence, to produce results or be cost-effective.
Using evidence to guide budgeting does not, however, limit governments to invest only in what is known to be effective. Instead, progress may require experimentation, measuring the results, learning and adaptation. Federal, state and local leaders should make room in their budgets for initiatives that have a sound theory of change, and then rigorously evaluate those initiatives, scaling up the ones that make a difference and dropping the ones that don’t.