Pay-As-You-Go (PAYGO)

Pay-As-You-Go (PAYGO) is a budgeting principle used by governments that requires any new spending to be offset by an equivalent amount of revenue. This means that if lawmakers want to introduce a new program or increase spending, they must find a way to fund it without increasing the deficit. This approach promotes fiscal responsibility by ensuring that the government does not borrow excessively and encourages careful consideration of the costs and benefits of new initiatives. PAYGO helps maintain a balanced budget in the long term, aiming for sustainable financial practices.