TESTIMONY OF
MITCHELL E. DANIELS, JR.
DIRECTOR
OFFICE OF MANAGEMENT AND BUDGET
BEFORE THE
SUBCOMMITTEE ON TREASURY, POSTAL SERVICE AND
GENERAL GOVERNMENT
COMMITTEE ON APPROPRIATIONS
U.S. HOUSE OF REPRESENTATIVES
MAY 10, 2001
Mr. Chairman, Representative Hoyer, Members of the Subcommittee, I
am pleased to be here this
morning to discuss the President's FY 2002 budget request for the Office of
Management and
Budget (OMB).
I will make a short statement and then I would be pleased to answer
any questions that you have.
Overview
First, I would like to reiterate the President's overarching
commitment to ensuring that key
national priorities are funded within a moderate rate of growth for
discretionary spending. The
Administration will continue to work with the Congress to realize our
shared purposes and
common principles. Keeping faith with this approach, the President is
committed to ensuring
economy and efficiency in managing the Executive Office of the President,
which includes the
Office of Management and Budget. As a result, OMB's budget request for FY
2002 reflects
Administration policy guidance freezing spending at the FY 2001 level
adjusted only for the
expected pay adjustment.
For FY 2002, the Office of Management and Budget requests budget
authority of $70.5 million.
This request is an increase of $1.9 million (or 2.7 percent) over the FY
2001 funding level of
$68.6. The OMB budget request will provide 527 full-time equivalent (FTE)
positions, the same
FTE level as FY 2001.
The Office of Management and Budget provides fiscal and budgetary
analysis to the President.
We believe that this office, as the chief management and budget office of
the executive branch,
has a special obligation to adhere to budgetary discipline and to maximize
the productivity of our
resources. As you can see from our budget request for FY 2002, OMB is
committed to
maintaining budgetary restraint.
Consolidated EOP Appropriation
As you know, the Executive Office of the President, despite the
name, has never been managed or
budgeted for as a single entity and is not currently covered under a single
appropriation. One new
feature in the President's Budget request is to consolidate the Executive
Office of the President
offices and councils under one appropriation. The reason for the
consolidation is to enable
genuine resource management in the Executive Office of the President.
To ensure that the Executive Office of the President has the ability
to fulfill the requirements of
the Chief Financial Officers Act, the Administration prepared a budget
amendment to establish
this single appropriation. A consolidated appropriation will enable the
President to effectively
manage and align resources to meet the evolving requirements of his office.
The initiative also
supports a single, integrated financial management system consistent with
the requirements of the
Chief Financial Officers Act.
The Administration recognizes that the current fragmented financial
structure does not allow the
Executive Office of the President to maximize buying power by purchasing in
bulk. Further, it
does not allow for control of the number of service contracts that are
needed to support various
types of equipment. In addition, the existing financial structure creates
an unnecessary amount of
procurement actions and paperwork. It is our belief that a consolidated
appropriation will allow
the Executive Office of the President to achieve these and other
streamlining objectives.
Government-wide Performance
Mr. Chairman, let me briefly touch on what we plan to do to get
better results from the
government's programs. We want to focus on performance as a key tool in
improving agency
management, reforming the way we do business, and making government
officials more
accountable for how well their programs and organizations perform.
Our main focus over the next months will be working toward full
integration of budget and
performance information, and using performance data to help make program
and budget
decisions. OMB annually receives the performance plans and reports of
approximately 100
departments and agencies for our review and use. At least every three
years, we receive a set of
updated strategic plans from these departments and agencies. And annually,
we prepare a
government-wide performance plan, which has become a major part of the
President's budget.
These plans and reports are required by the Government Performance and
Results Act of 1993
(the Results Act), which was passed unanimously by Congress. We are
nearing the fifth year of
full-scale government-wide implementation of the Results Act. While the
quality and scope of
the plans and reports has improved over time, further progress is still
needed and expected. Our
effort spans several related initiatives. Let me briefly describe these
for you.
First, we will insist that agencies
develop a credible linkage between resources and performance.
We need to be able to answer the question: "What are we getting for the
money we are
spending?" As we work to establish this linkage, we expect to make some
changes to the
traditional process of how we review budget requests, and the nature of our
passback to the
agencies on their requests.
Second, we intend to improve our ability to understand the true cost
of each program. Full
costing of certain program budget accounts will necessitate significant
accounting changes, and
we are developing a legislative proposal permitting us to assign currently
unallocated costs and
present these in the budget.
Third, you should see a more robust presentation of performance
information in the FY 2003
President's Budget. We also intend to explore how a significant
restructuring of the budget
document itself might enhance public and Congressional understanding of
governmental
performance.
Work is already underway on these and several related initiatives.
These tasks will engage nearly
every OMB office, and will comprise a significant part of the workload over
the next year. We
believe that this work will lead to a big potential payoff in improved
effectiveness and efficiency
of government.
Electronic Government (E-Gov)
I'd like to spend a little time discussing an item that is important
to the President and that is under
the purview of this subcommittee - the E-Gov fund. The President is
committed to bringing the
Federal government closer to its citizens and has proposed to accelerate
Federal efforts to
implement "electronic government," or E-Gov, as an important step in this
endeavor. The FY
2002 Budget seeks an appropriation of $20 million as the first installment
of this fund, which will
total $100 million over the next three years.
The E-Gov fund will be used to fund interagency initiatives that
will expand the use of the
Internet to provide individuals, businesses, and other government agencies
with simpler and more
timely access to Federal information, benefits, services, and business
opportunities. OMB would
manage allocations from the fund, which would be housed in an account in
the General Services
Administration, and assure its use for information technology projects that
offer the greatest
improvements in access and service. Criteria for using the fund are still
under development, but
would include placing a priority on funding innovative interagency projects
that would deliver
services directly to the public, or create the infrastructure to support
such delivery. We have
briefed your staff on our preliminary thoughts in this area and welcome
input from the
Subcommittee as these criteria are developed.
Conclusion
Mr. Chairman, OMB is a professional organization committed to
producing the best possible
work in support of both executive and legislative branch policy decisions.
For this reason, I
recommend that you approve our request for FY 2002.
Mr. Chairman, that concludes my statement. I would be happy to
answer any of the
Subcommittee's questions.
