New development: Green budgeting—integrating environmental goals into the resource allocation process

Green budgeting is a systematic approach to integrating environmental considerations into public financial management. Austria's approach demonstrates a comprehensive methodology of scrutinizing all budgetary items for their environmental impact. With the Austrian Ministry of Finance taking a leading and co-ordinating role, the green budgeting approach at the federal level seems promising. It is characterised by a commitment to continuous improvement, and supported by high-level political will, as well as robust institutional mechanisms. As more countries explore green budgeting, Austria's experience offers valuable lessons and insights—particularly in how inter-agency co-ordination can support the expansion of green budgeting across all line ministries. Little is known about whether and how countries are co-ordinating approaches to green budgeting across governmental levels. This article presents voices from selected state and local governments, highlighting the challenges of a lack of resources at subnational government levels and ensuring that current budgeting systems are not overwhelmed. The authors suggest approaches that supranational bodies can take to promote green budgeting.