Why do we complete appraisals every year when there is not always budget for merit increases?

To know how long the performance of employees to recognize the outstanding employee who progresses and develops and even help us in selecting the appropriate employee for promotion

Appraisals are important to evaluate the employees performance, it is not necessary that employer has to do it in monetary way if budget contstraint are there. Promotions and extra responsibilities can be assigned to desrving candidates so that they can feel Honour.