Green Budgeting In Oecd Countries

Climate and environmental considerations have become pressing priorities for governments in recent years. International commitments such as the Paris Agreement, the Aichi Biodiversity Targets under the Convention on Biodiversity (CBD) and the Sustainable Development Goals (SDGs) have spurred momentum across the OECD to prioritise green objectives to policy-making processes.

This report provides an overview of green budgeting practices across OECD countries based on the 2022 OECD Green Budgeting Survey, as well as the index methodology for the Survey. It takes stock of OECD countries’ progress in bringing climate and environmental considerations into budgeting frameworks and processes.

Climate and environmental considerations have become pressing priorities for governments in recent years. International commitments such as the Paris Agreement, the Aichi Biodiversity Targets under the Convention on Biodiversity (CBD) and the Sustainable Development Goals (SDGs) have spurred momentum across the OECD to prioritise green objectives to policy-making processes. As these efforts require systematic considerations across all parts of government, countries have identified the budget process as playing a key role in ensuring that priorities relating to the environment and climate change are part of the policy-making process. Thus, there has been an emergence of "green budgeting" practices across the OECD. Countries use green budgeting as a tool of budgetary policy making to provide policy makers with a clearer understanding of the environmental and climate impacts of budgeting choices, while bringing evidence together in a systematic and co-ordinated manner for more informed decision making to fulfil national and international commitments. This publication presents the findings from the first survey on green budgeting across OECD countries and provides information on the extent to which countries have the key elements of an effective approach to pursue environmental and climate priorities.

Climate and environmental considerations have become pressing priorities for governments in recent years. International commitments such as the Paris Agreement, the Aichi Biodiversity Targets under the Convention on Biodiversity (CBD) and the Sustainable Development Goals (SDGs) have spurred momentum across the OECD to prioritise green objectives to policy-making processes. As these efforts require systematic considerations across all parts of government, countries have identified the budget process as playing a key role in ensuring that priorities relating to the environment and climate change are part of the policy-making process. Thus, there has been an emergence of "green budgeting" practices across the OECD. Countries use green budgeting as a tool of budgetary policy making to provide policy makers with a clearer understanding of the environmental and climate impacts of budgeting choices, while bringing evidence together in a systematic and co-ordinated manner for more informed decision making to fulfil national and international commitments. This publication presents the findings from the first survey on green budgeting across OECD countries and provides information on the extent to which countries have the key elements of an effective approach to pursue environmental and climate priorities.

Green budgeting is emerging at subnational levels as an important tool for regions and cities to use to align their expenditure and revenues with their green objectives, and enhance the transparency and accountability of their climate and environmental action. It is also a tool that subnational governments can use to prioritise low-carbon investments and identify funding gaps, as well as to mobilise additional sources of both private and public climate finance.

The 2021 edition includes input indicators on public finance and employment; process indicators include data on institutions, budgeting practices, human resources management, regulatory governance, public procurement, governance of infrastructure, public sector integrity, open government and digital government. Outcome indicators cover core government results (e.g. trust, political efficacy, inequality reduction) and indicators on access, responsiveness, quality and satisfaction for the education, health and justice sectors.

This report presents the OECD's advice on good practice principles and examples in the area of performance budgeting including an explanation of the evidence supporting the adoption and practice by OECD countries.