Some commentators argue that: 'With continuing pressure to control costs and maintain efficiency, the time has come for all public sector organization to embrace zero-based budgeting. There is no longer a place for incremental budgeting in any organization, particularly public sector ones, where zero-based budgeting is far more suitable anyway.'

Required:

(a)Discuss the particular difficulties encountered when budgeting in public sector organization compared with budgeting in private sector organization, drawing comparisons between the two types of organization.(5 marks)

(b)Explain the terms 'incremental budgeting' and 'zero-based budgeting'.(4 marks)

(c)State the main stages involved in preparing zero-based budgets.(3 marks)

(d)Discuss the view that 'there is no longer a place for incremental budgeting in any organization, particularly public sector ones', highlighting any drawbacks of zero-based budgeting that need to be considered. (8 marks)