    [Budget of the United States Government]
    [V. Investing in the Common Good: Program Performance in Federal Functions]
    [10. Restoring Trust in Government]
    [From the U.S. Government Publishing Office, www.gpo.gov]

    [[Page   159]]

    [[Page 161]]

                       10.  RESTORING TRUST IN GOVERNMENT

      ----------------------------------------------------------------------

      When I became President, I knew we had to change old policies and old ways of doing things . . . the American
    people had a very low level of confidence in the Government . . . We wanted to change all that. We knew it was
    important for our economy . . . We knew it was important for the integrity of our democracy.
                                          President Clinton
                                          January 1999

      ----------------------------------------------------------------------
      Americans believe that Government can deliver better results and
    improve their quality of life and the lives of their families. A
    generation ago, when the University of Michigan's Institute for Social
    Research asked ``Do you trust the Federal Government to do the right
    things most of the time?'' 76 percent of Americans expressed confidence
    in the Federal Government. By 1994, that number had declined to only 21
    percent. Analyses of the underlying causes of distrust of Government by
    The Pew Charitable Trusts, the Council for Excellence in Government,
    leading universities and other groups suggest there is a key link
    between confidence in Government and Government's performance.
      President Clinton and Vice President Gore recognized this and set
    about improving the responsiveness and performance of the Federal
    Government. The success of these efforts is reflected in the significant
    changes in the way Government does its business and the new confidence
    on the part of the American public. In the second term of this
    Administration, public trust in the Federal Government nearly doubled in
    the course of only four years, reaching 40 percent when last measured by
    the University of Michigan in 1998 (see Chart 10-1).
      Recent studies show that many people base their decisions about how
    much they trust their Government on their assessment of how well they
    believe Federal agencies perform. When Governments work for the people--
    when citizens receive good basic services and have faith in the
    Government that is providing them--a large measure of stability and
    community naturally follows. In the past seven years, President Clinton
    and Vice President Gore have made substantial efforts to improve
    Government performance with demonstrable results.

      Any organization that seeks to perform at a high level must have clear
    expectations, along with the necessary resources, the flexibility, and
    the management capacity to improve performance and get results. In 1993,
    Congress passed the Government Performance and Results Act (GPRA) which
    established a framework to set expectations, measure the progress toward
    meeting these goals, and report on results. For the first time this
    year, agencies will report upon these results in light of the
    performance goals they established in their 1999 plans. Later in 2000,
    agencies will update their strategic plans to cover activities for the
    next three to five years. Each year, agencies are more and more making
    performance measures a key part of their basic decisions, resulting in
    better budgeting and better programs.

    The Administration's Stewardship is Making a Difference

      In 1993, President Clinton and Vice President Gore launched the
    longest running management reform effort in the Federal Government's
    history, the Reinventing Government initiative. This effort has created
    a Government that works better, costs less, and gets results Americans
    care about. In the past seven years, the Administration has streamlined
    the work force, eliminated obsolete programs and agencies, empowered its
    employees to cut red tape, and used partnerships to get results.

    [[Page 162]]

      Between 1993 and 1999, the Administration reduced the size of the
    Federal civilian work force by 17 percent, or 377,000 full-time
    equivalent employees. As Chart 10-2 shows, this is the smallest Federal
    work force in 39 years. This reduction has been accomplished almost
    entirely through voluntary separations. Almost all of the 14 Cabinet
    Departments and large independent agencies have reduced their work force
    (see Chart 10-3). For example, the Office of Personnel Management
    reduced its work force by 55 percent during this period. And the growth
    in the Justice Department's work force, running contrary to the overall
    trend, specifically reflects the Administration's commitment to
    expanding the fight against crime and drugs, while the Commerce
    Department has hired additional employees on a temporary basis to meet
    the demands of the decennial census.
      To enable agencies to downsize and restructure so that they can better
    achieve their overall goals and missions, the Administration proposed
    and Congress enacted legislation in 1999 authorizing agencies to target
    offers of voluntary, early retirement to particular segments of the work
    force. The Administration will seek Government-wide authority to offer
    such voluntary separation incentives (buyouts) where justified through
    cost benefit analysis and will also continue to support agencies needing
    separate buyout authority to restructure their work force.

    The Administration is Improving Performance

      While reducing costs and cutting red tape are important management
    objectives, the highest priority objective is for Federal agencies to
    deliver results that Americans care about. Studies show that high
    performing organizations use a balanced set of measures to determine how
    they are doing in achieving ``bottom line'' mission results, maintaining
    strong employee morale, and satisfying their customers. These three
    elements are related. Research shows that when employee satisfaction
    grows, so too does the satisfaction of the customers they serve. This,
    in turn, contributes to improved mission (or operational) results.
    Together, such results-ori

    [[Page 164]]

    ented measures give a more comprehensive picture of how programs are
    performing and prevents managers from making improvements in one area at
    the expense of another.

      Customer satisfaction: In 1999, the Administration sponsored the
    first-ever Government-wide survey of the customers of agencies that deal
    the most with the public. The Government-wide American Customer
    Satisfaction Index was 68.6 on a 100-point scale. With an index of
    nearly 72, private sector services are in a similar range. In fact,
    certain Federal agencies do as well or better than the private sector in
    a number of areas. For example, Federal customers receiving earned
    benefits rated their agencies at 77 while the comparable private sector
    area had the same rating. Similarly, Veterans Health Administration
    outpatient services ranked 79; private sector hospitals ranked 70. As
    might be expected, there is considerable variation between agencies that
    provide benefits or services and those that collect taxes or regulate.
    The activities of regulatory agencies benefit the public at large, but
    may not be perceived as benefiting those subject to the regulation.
    Chart 10-4 shows customer satisfaction with selected Federal services
    compared to average satisfaction for private sector services. For
    details, see the website www.npr.gov. In addition, 60 percent of those
    surveyed thought service had improved in the past two years. Each
    participating agency has committed to improve its customer satisfaction
    in the coming year. The agency plans are available at the website
    www.customersurvey.gov. In 2000 and 2001, agencies will repeat the
    survey and expand the services covered.

      Employee satisfaction: A second 1999 Government-wide survey--of the
    Federal work force--showed that job satisfaction in Federal agencies is
    similar to the private sector. It also showed a dramatic leap in the
    number of Government employees who see customer service as an essential
    component of their jobs. Today, this is true for 72 percent of Federal
    Government employees. Less than a decade ago, shortly before this
    Administration came to of

    [[Page 165]]

    fice, only 36 percent of supervisors considered customer service to be
    important. In addition, the survey showed that employees in
    organizations where reinvention has been a priority were twice as
    satisfied with their jobs, felt they were more empowered to serve their
    customers, and faced less red tape than other employees.
      To recognize that Federal employees are the key to effective
    Government performance, and to enable the Government to attract and
    retain a high-quality work force, the President proposes to enhance the
    current compensation package. First, the President proposes a 3.7
    percent pay raise for civilian employees, an increase greater than the
    recent wage growth in the private sector. Second, the Administration
    will request that Congress reverse action taken last year to delay into
    2001 the last 2000 paycheck of many Federal employees and to repeal,
    effective January 2001, the higher retirement contributions required of
    Federal employees by the Balanced Budget Act of 1997. Third, the
    President will enable Federal employees to pay their annual health
    insurance premiums out of pre-tax income, a benefit already available to
    most employees in the private sector and State and municipal
    Governments.

      Getting Results: The commitment of the President and the Congress to
    balance the budget--and keep it in balance--has rightly prompted
    increased focus on the allocation of resources to programs that advance
    each agency's mission. Therefore, agencies are increasingly justifying
    funds for programs in terms of performance. The Executive Branch and the
    Congress are asking the key questions: ``What are we getting for what we
    are spending?'' and ``How will we know if we are successful?''
      The bottom line for Government organizations is their mission: the
    goals and outcomes that can indicate success. For example, a major
    performance goal for the Environmental Protection Agency is to reduce
    air toxics emissions. The Department of Education's Student Financial
    Assistance Program has a major goal to ensure that low- and middle-
    income students will have the same access to post- secondary education
    that high-income students do. The Social Security Administration seeks
    to deliver customer-responsive world-class service.
      Often performance is examined only across single organizational units,
    such as a Department or agency. In Chapters 11 (National Security)
    through 27 (General Government) that follow, program performance is
    described according to budget functions. The functional presentation
    reflects comprehensive coverage of the major accounts in the budget,
    grouping together similar programs to show the interrelationships among
    their goals. The chapters include illustrative accomplishments in 1999
    and other recent years, and also highlight performance goals for 2001.
    Additional detail will be available when the agencies distribute their
    2001 performance plans and their first-ever annual performance reports
    assessing operational results for 1999.
      The material that follows, together with Section III, ``Sustaining Our
    Economic Prosperity,'' constitutes the third comprehensive Government-
    wide Performance Plan. Together these sections, which highlight fiscal
    performance and operating performance, contain an integrated view of the
    measures and descriptions of program activity contemplated by the GPRA.
      In addition, OMB is separately submitting its third Report to Congress
    on the Costs and Benefits of Federal Regulations. This report is
    required by Section 638(a) of the 1999 Omnibus Consolidated and
    Emergency Supplemental Appropriations Act. The report updates
    information on the costs and benefits of Federal regulations in the
    aggregate, by agency and agency program, and by major rule. It also
    presents an analysis of impacts of Federal regulation on State, local,
    and Tribal governments, small business, wages, and economic growth.
    Finally, the report provides recommendations for reform of specific
    regulations.

    [[Page 166]]

                                        Table 10-1. FEDERAL RESOURCES BY FUNCTION
                                                (In billions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                             Estimate
              Category               1999    -----------------------------------------------------------------------
                                    Actual       2000        2001        2002        2003        2004        2005
    ----------------------------------------------------------------------------------------------------------------
    NATIONAL DEFENSE:
      Spending:
        Discretionary Budget          288.1       294.1       306.3       310.1       316.4       324.1       332.4
         Authority..............
        Mandatory Outlays:
          Existing law..........       -0.6        -0.5        -0.9        -0.8        -0.8        -0.7        -0.7
      Credit Activity:
        Direct loan               ..........          *   ..........        N/A         N/A         N/A         N/A
         disbursements..........
        Guaranteed loans........          *           *   ..........        N/A         N/A         N/A         N/A
      Tax Expenditures:
        Existing law............        2.1         2.1         2.2         2.2         2.2         2.2         2.2

    INTERNATIONAL AFFAIRS:
      Spending:
        Discretionary Budget           41.5        23.9        22.8        23.2        23.5        24.1        24.6
         Authority..............
        Mandatory Outlays:
          Existing law..........       -4.3        -4.8        -4.1        -3.7        -3.7        -3.7        -3.7
      Credit Activity:
        Direct loan                     2.8         1.8         1.4         N/A         N/A         N/A         N/A
         disbursements..........
        Guaranteed loans........        9.5        12.8        12.5         N/A         N/A         N/A         N/A
      Tax Expenditures:
        Existing law............       14.4        15.6        16.7        17.0        17.6        18.8        20.1
        Proposed legislation....  ..........        0.1         0.2         0.1           *          -*          -*

    GENERAL SCIENCE, SPACE, AND
     TECHNOLOGY:
      Spending:
        Discretionary Budget           18.8        19.2        20.8        21.2        21.5        22.1        22.5
         Authority..............
        Mandatory Outlays:
          Existing law..........          *         0.1         0.1           *           *           *           *
      Tax Expenditures:
        Existing law............        3.6         2.9         5.2         5.7         5.1         4.8         3.9

    ENERGY:
      Spending:
        Discretionary Budget            2.9         2.6         2.9         3.3         3.1         3.2         3.3
         Authority..............
        Mandatory Outlays:
          Existing law..........       -2.2        -4.5        -3.8        -3.9        -3.7        -4.0        -4.0
      Credit Activity:
        Direct loan                     1.1         1.7         1.6         N/A         N/A         N/A         N/A
         disbursements..........
        Guaranteed loans........          *         0.1         0.2         N/A         N/A         N/A         N/A
      Tax Expenditures:
        Existing law............        1.9         1.9         1.9         2.0         1.3         1.4         1.4
        Proposed legislation....  ..........  ..........        0.2         0.4         0.7         1.1         1.6

    NATURAL RESOURCES AND
     ENVIRONMENT:
      Spending:
        Discretionary Budget           23.8        24.0        24.9        25.1        25.4        26.0        26.5
         Authority..............
        Mandatory Outlays:
          Existing law..........        0.3         0.5         0.6         0.7         0.9         0.8         0.8
          Proposed legislation..  ..........  ..........       -0.2        -0.1        -0.5        -0.4        -0.3
      Credit Activity:
        Direct loan                       *           *           *         N/A         N/A         N/A         N/A
         disbursements..........
        Guaranteed loans........  ..........  ..........        0.1         N/A         N/A         N/A         N/A
      Tax Expenditures:
        Existing law............        1.5         1.5         1.6         1.6         1.7         1.8         1.8
        Proposed legislation....  ..........  ..........          *           *         0.1         0.2         0.3

    AGRICULTURE:
      Spending:
        Discretionary Budget            4.5         4.5         4.6         4.6         4.5         4.7         4.7
         Authority..............
        Mandatory Outlays:
          Existing law..........       18.4        26.1        14.3         9.8         9.7         7.6         6.6
          Proposed legislation..  ..........        0.7         3.4         3.3   ..........  ..........  ..........
      Credit Activity:
        Direct loan                    10.0        12.2        10.6         N/A         N/A         N/A         N/A
         disbursements..........
        Guaranteed loans........        2.6         6.6         6.6         N/A         N/A         N/A         N/A

    [[Page 167]]

      Tax Expenditures:
        Existing law............        0.9         0.9         1.0         1.0         1.0         1.1         1.1

    COMMERCE AND HOUSING CREDIT:
      Spending:
        Discretionary Budget            3.8         7.2         3.5         3.3         3.3         3.2         3.3
         Authority..............
        Mandatory Outlays:
          Existing law..........       -0.9        -1.6        -0.8        -1.0        -1.5        -1.3        -0.7
          Proposed legislation..  ..........  ..........       -0.1        -0.1        -0.1        -0.1        -0.1
      Credit Activity:
        Direct loan                     2.1         1.8         2.0         N/A         N/A         N/A         N/A
         disbursements..........
        Guaranteed loans........      306.6       264.0       273.9         N/A         N/A         N/A         N/A
      Tax Expenditures:
        Existing law............      227.9       235.6       247.1       255.3       264.4       274.7       284.4
        Proposed legislation....  ..........  ..........        0.3         0.5         0.5         0.7         0.8

    TRANSPORTATION:
      Spending:
        Discretionary Budget           13.7        13.3        14.5        14.5        15.0        15.6        16.3
         Authority..............
        Mandatory Outlays:
          Existing law..........        1.9         2.4         2.1         1.6         2.0         1.9         1.9
          Proposed legislation..  ..........  ..........          *           *           *           *           *
      Credit Activity:
        Direct loan                     0.2         1.0         0.9         N/A         N/A         N/A         N/A
         disbursements..........
        Guaranteed loans........        1.8         2.8         0.9         N/A         N/A         N/A         N/A
      Tax Expenditures:
        Existing law............        1.9         2.0         2.1         2.2         2.3         2.5         2.6

    COMMUNITY AND REGIONAL
     DEVELOPMENT:
      Spending:
        Discretionary Budget           11.0        11.5        12.3        12.3        12.5        12.8        13.1
         Authority..............
        Mandatory Outlays:
          Existing law..........         -*        -0.5        -0.6        -0.8        -0.9        -0.9        -1.1
          Proposed legislation..  ..........  ..........       -0.1           *         0.1         0.2         0.2
      Credit Activity:
        Direct loan                     1.7         2.1         2.8         N/A         N/A         N/A         N/A
         disbursements..........
        Guaranteed loans........        1.6         2.4         2.9         N/A         N/A         N/A         N/A
      Tax Expenditures:
        Existing law............        1.3         1.4         1.5         1.4         1.2         1.1         1.1
        Proposed legislation....  ..........  ..........        0.1         0.5         1.0         1.3         1.6

    EDUCATION, TRAINING,
     EMPLOYMENT, AND SOCIAL
     SERVICES:
      Spending:
        Discretionary Budget           46.6        44.4        61.5        61.6        62.3        63.4        64.6
         Authority..............
        Mandatory Outlays:
          Existing law..........       11.3        11.3        15.4        14.0        15.5        16.2        17.2
          Proposed legislation..  ..........       -0.1        -2.8        -0.2        -0.2        -0.2        -0.2
      Credit Activity:
        Direct loan                    18.1        14.7        15.8         N/A         N/A         N/A         N/A
         disbursements..........
        Guaranteed loans........       21.9        25.3        26.5         N/A         N/A         N/A         N/A
      Tax Expenditures:
        Existing law............       34.1        36.0        37.6        38.7        41.2        42.4        44.7
        Proposed legislation....  ..........        0.1         1.4         3.7         3.8         5.0         5.5

    HEALTH:
      Spending:
        Discretionary Budget           30.2        33.8        35.0        34.8        35.2        36.1        36.8
         Authority..............
        Mandatory Outlays:
          Existing law..........      114.1       123.3       132.3       143.2       155.1       167.5       181.3
          Proposed legislation..  ..........  ..........        1.1         2.8         5.3         8.1         9.8
      Credit Activity:
        Guaranteed loans........  ..........        0.1         0.1         N/A         N/A         N/A         N/A

    [[Page 168]]

      Tax Expenditures:
        Existing law............       82.9        89.3        95.2       101.7       107.4       114.2       122.0
        Proposed legislation....  ..........  ..........        0.1         1.3         2.8         3.9         4.7

    MEDICARE:
      Spending:
        Discretionary Budget            2.8         3.1         3.0         3.0         3.0         3.1         3.2
         Authority..............
        Mandatory Outlays:
          Existing law..........      187.7       199.5       218.3       223.7       241.9       255.4       277.5
          Proposed legislation..  ..........  ..........       -0.7         2.6        -2.7         6.5         6.1

    INCOME SECURITY:
      Spending:
        Discretionary Budget           32.7        29.8        41.3        41.3        41.8        42.9        43.8
         Authority..............
        Mandatory Outlays:
          Existing law..........      197.8       207.4       217.2       229.7       240.9       251.1       263.3
          Proposed legislation..  ..........        2.2        -1.6         0.9         1.5         3.0         3.1
      Credit Activity:
        Direct loan                       *           *           *         N/A         N/A         N/A         N/A
         disbursements..........
        Guaranteed loans........          *         0.1         0.1         N/A         N/A         N/A         N/A
      Tax Expenditures:
        Existing law............      140.3       147.7       153.1       159.3       165.6       172.1       178.8
        Proposed legislation....  ..........          *         2.6         4.6         7.9        10.4        16.4

    SOCIAL SECURITY:
      Spending:
        Discretionary Budget            3.2         3.2         3.5         3.5         3.5         3.6         3.7
         Authority..............
        Mandatory Outlays:
          Existing law..........      387.0       403.3       422.2       443.0       465.3       489.7       516.2
          Proposed legislation..  ..........  ..........  ..........        0.1         0.1         0.1         0.2
      Tax Expenditures:
        Existing law............       23.3        24.5        25.8        27.3        29.0        30.8        23.3

    VETERANS BENEFITS AND
     SERVICES:
      Spending:
        Discretionary Budget           19.3        20.9        22.1        22.1        22.3        22.9        23.4
         Authority..............
        Mandatory Outlays:
          Existing law..........       23.8        25.1        25.6        26.3        27.6        28.4        31.0
          Proposed legislation..  ..........        1.8        -1.5         0.8         1.0         1.5         2.0
      Credit Activity:
        Direct loan                     1.7         2.0         0.7         N/A         N/A         N/A         N/A
         disbursements..........
        Guaranteed loans........       43.1        32.1        29.5         N/A         N/A         N/A         N/A
      Tax Expenditures:
        Existing law............        3.1         3.3         3.4         3.5         3.7         3.9         4.1

    ADMINISTRATION OF JUSTICE:
      Spending:
        Discretionary Budget           26.5        26.6        29.0        30.0        30.1        30.3        30.9
         Authority..............
        Mandatory Outlays:
          Existing law..........        0.9         1.5         1.5         0.8         0.7         2.1         2.2
          Proposed legislation..  ..........  ..........  ..........  ..........  ..........       -1.5        -1.5

    GENERAL GOVERNMENT:
      Spending:
        Discretionary Budget           13.7        12.6        14.7        14.5        14.6        14.8        15.0
         Authority..............
        Mandatory Outlays:
          Existing law..........        3.3         1.7         1.4         1.3         1.3         1.6         1.4
          Proposed legislation..  ..........          *           *         0.4         0.4         0.4         0.4
      Credit Activity:
        Direct loan               ..........          *           *         N/A         N/A         N/A         N/A
         disbursements..........
      Tax Expenditures:
        Existing law............       63.0        65.8        68.3        70.8        73.8        77.0        80.3
        Proposed legislation....  ..........  ..........          *         0.3         0.3         0.3         0.4

    [[Page 169]]

    NET INTEREST:
      Spending:
        Mandatory Outlays:
          Existing law..........      229.7       220.3       208.3       198.6       189.2       177.4       163.6
          Proposed legislation..  ..........  ..........          *           *         0.1         0.1         0.1

      Tax Expenditures:
        Existing law............        1.0         1.1         1.1         1.2         1.2         1.3         1.4

    ALLOWANCES:
      Spending:
        Discretionary Budget      ..........  ..........       -0.2        -0.2        -0.3        -0.3        -0.3
         Authority..............

    UNDISTRIBUTED OFFSETTING
     RECEIPTS:
      Spending:
        Discretionary Budget      ..........  ..........       -0.2        -0.2        -0.2        -0.2        -0.2
         Authority..............
        Mandatory Outlays:
          Existing law..........      -40.4       -43.1       -45.7       -49.1       -47.3       -46.9       -48.6
          Proposed legislation..  ..........  ..........        0.3         0.3         0.3         0.3         0.3

    FEDERAL GOVERNMENT TOTAL:
      Spending:
        Discretionary Budget          583.1       574.7       622.2       627.7       637.5       652.1       667.5
         Authority..............
        Mandatory Outlays:
          Existing law..........    1,128.1     1,167.4     1,203.2     1,233.5     1,292.3     1,342.3     1,404.2
          Proposed legislation..  ..........        4.6        -2.1        10.7         5.3        18.1        20.0

      Credit Activity:
        Direct loan                    37.7        37.3        35.8         N/A         N/A         N/A         N/A
         disbursements..........
        Guaranteed loans........      388.2       348.3       354.1         N/A         N/A         N/A         N/A
    ----------------------------------------------------------------------------------------------------------------
    * $50 million or less.
    N/A Not available.