[Budget of the United States Government]
[V. Investing in the Common Good: Program Performance in Federal Functions]
[31. Improving Performance through Better Management]
[From the U.S. Government Publishing Office, www.gpo.gov]
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31. IMPROVING PERFORMANCE THROUGH BETTER MANAGEMENT
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We made a decision that was profoundly important, that the way Government works matters, that we could not
maintain the confidence of the American people and we could not have ideas that delivered unless the Government
was functioning in a sensible, modern, and prudent way.
President Clinton
December 1998
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In the past two years, the Administration has tackled the
Government's biggest management challenges, which are designated
Priority Management Objectives (PMOs), through a coordinated, sustained
and intensive effort with the agencies to achieve significant
improvements in these areas. This year, the Administration is targeting
24 Government-wide and agency-specific management issues for heightened
attention (see Table 31-1). Four are new: ``Use capital planning and
investment control to better manage information technology;''
``Streamline and simplify Federal grants management;'' ``Align human
resources to support agency goals;'' and, ``Capitalize on Federal energy
efficiency.''
Last year, the Administration successfully advanced several of our
management goals (which therefore are no longer on the PMO list). In
particular, the Administration resolved its first and foremost
management objective, ``Manage the year 2000 (Y2K) computer problem''
with impressive results. Y2K posed the single largest technology
management challenge in history. The Federal Government's acknowledged
success through the date change was the direct result of the commitment,
long hours, and exceptional efforts of Federal employees in every
agency. Due largely to the efforts of these employees and the leadership
provided by the President's Council on Year 2000 Conversion, the Federal
Government's Y2K efforts were, beyond all expectation, remarkably
trouble-free. Under the direction of the President's Council, the
Federal Government also worked with the private sector, State, and local
governments, and international organizations to raise awareness and
encourage work on the problem. Again, the results were uniformly
acclaimed. In the Spring of 2000, the Conversion Council will prepare a
final report which will include lessons learned from this challenge.
Two other objectives were successfully accomplished in 1999. First,
to meet the goal ``Better manage real property,'' the General Services
Administration developed a draft legislative proposal to increase agency
incentives to dispose of unneeded real property--making it available for
more productive public or private use, in turn providing resources for
agencies to fund needed capital investments. Second, to ``Improve
management of the decennial census,'' the Bureau of the Census in the
Department of Commerce established and tested the necessary support
structure--which includes opening data capture centers, regional census
offices, and local census offices, printing forms, establishing a
telephone questionnaire assistance program, printing language assistance
guides, and recruiting and training temporary census workers--and it is
now ready for operation. Finally, in 1999, all agencies identified
activities performed by Federal employees that could be opened to
competition potentially resulting in contracts with either private firms
or with a more efficient public sector operation. Since such competitive
reviews are an important element of the effort to ``Revolutionize DOD
business affairs,'' the objective ``Use competition to improve
operations'' has been incorporated into the Department of Defense (DOD)
objective.
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Table 31-1. Priority Management Objectives
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Strengthening Government-Wide Management
1. Use performance information to improve program management and budget decision- making.
2. Improve financial management information.
3. Use capital planning and investment control to better manage information technology.
4. Provide for computer security and protect critical information infrastructure.
5. Strengthen statistical programs.
6. Implement acquisition reforms.
7. Implement electronic Government initiatives.
8. Better manage Federal financial portfolios.
9. Align Federal human resources to support agency goals.
10. Verify that the right person is getting the right benefit.
11. Streamline and simplify Federal grants management.
12. Capitalize on Federal energy efficiency.
Improving Program Implementation
13. Modernize student aid delivery.
14. Improve DOE program and contract management.
15. Strengthen HCFA's management capacity.
16. Implement HUD reform.
17. Reform management of Indian trust funds.
18. Implement FAA management reforms.
19. Implement IRS reforms.
20. Streamline SSA's disability claims process.
21. Revolutionize DOD business affairs.
22. Manage risks in building the International Space Station.
23. Improve security and management of overseas presence.
24. Reengineer the naturalization process and reduce the citizenship application backlog.
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The PMOs are coordinated by OMB with assistance from the National
Partnership for Reinventing Government (NPR) and the inter-agency
working groups, thus assuring senior management attention. Managers in
the agencies have the primary responsibility to achieve the agreed-upon
objectives--they must effectively implement detailed action plans to
ensure that they make progress toward meeting their goals. Periodic
reporting and review provide an opportunity for corrective action as
necessary throughout the year.
Strengthening Government-wide Management
1. Use performance information to improve program management and
budget decision-making: The Government Performance and Results Act
(GPRA) requires agencies to measure performance and results--not just
funding levels--so that we can better track what taxpayers are getting
for their dollars. Agencies are not only working to develop and use
performance measures in program management but also are working to
integrate this information into budget and resource allocations, so that
we can better determine the cost of achieving goals. The task is not
simple. The agencies must define their specific goals, determine the
proper level of resources, assess which programs are working, and fix
those that are not. Progress will depend on GPRA becoming more than a
paper exercise. Over the next year, OMB will work with all agencies to
better integrate planning and budgeting and systematically associate
costs with programs.
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2. Improve financial management information: Just a decade ago, the
Federal Government lagged far behind private industry in its ability to
offer assurances of financial integrity. The Administration recognized
and immediately began to address this weakness. Today, Government
agencies have a strong financial management infrastructure supported by
a comprehensive set of Federal financial accounting standards. Chief
Financial Officers (CFOs) in the 24 largest Federal agencies integrate
financial management agency-wide and produce annual audited financial
statements. As validation of our progress, in October 1999, the American
Institute of Certified Public Accountants recognized Federal Accounting
Standards Advisory Board statements as ``generally accepted accounting
principles'' (GAAP). This independent acknowledgment by the
internationally recognized organization that designates GAAP standard-
setting bodies marks a significant milestone in improving public
confidence in Federal financial management. Also, in 1999, 12 of 24 CFO
agencies received clean opinions on their 1998 statements, double the
number of clean opinions received in 1996 and in sharp contrast to 1993
when agencies did not routinely issue financial statements. In 1999, the
Federal Government also issued its second audited Government-wide
financial statement. Auditors noted specific accounting difficulties at
DOD, and the complexity of identifying and reporting transactions
between Federal Government entities (intra-Governmental transactions).
DOD has invested significant contractor support resources to address its
problems, and OMB, the Treasury Department, and the General Accounting
Office are working with the CFOs to develop short-and long-term
solutions to the intra-Governmental transactions issue. Almost all
agencies also face the daunting task of upgrading or replacing financial
management systems to provide the accurate, timely, and useful
information that is the cornerstone of both financial integrity and
performance measurement.
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Table 31-2. CFO Agency Financial Statement Performance Goals
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Estimate
Financial Statements 1998 -----------------
Actual 1999 2000 2001
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Audits Completed...................................................................... 24 24 24 24
Agencies with Unqualified Opinion..................................................... 12 18 21 22
Agencies with Unqualified and Timely Opinion.......................................... 7 16 21 22
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3. Use capital planning and investment control to better manage
information technology: The Government spends in excess of $38 billion
each year on information technology, and this number will continue to
grow as virtually all functions of Government take advantage of
efficiencies provided by information technology (IT). Well selected,
controlled, and managed IT projects can ensure that agencies fulfill
their missions with the lowest costs and greatest benefit to the
American people. The Administration will issue general guidance and will
work with agencies on specific systems to ensure that IT capital
planning is integrated with agency budget, acquisition, financial
management, and strategic planning processes, and that agencies properly
assess benefits, risks, performance goals and accomplishments of their
IT portfolios. Chapter 22 of Analytical Perspectives highlights program
performance benefits from major IT investments throughout the Federal
Government.
4. Provide for computer security and protect critical information
infrastructure: Protecting information systems that the Federal
Government depends on and that are critical to the economy is growing in
importance as society's use of technology and reliance on interconnected
computer systems increases. The Y2K remediation underscores the fact
that, along with increased productivity and efficiency of system
interconnections, there comes increased risk. However, if the risks are
identified and addressed in light of secu
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rity issues, they are manageable. Such risk management requires that we
incorporate security into the architecture of each system, promote
security controls that support agency business operations, and ensure
that security funding is built into life-cycle budgets for information
systems. Protecting Government information systems is a key component of
the broader imperative to protect the Nation's critical infrastructure--
namely such vital assets as banking and finance, transportation, energy,
or water, whose incapacity would have a debilitating effect on national
security, national economic security, or national public health and
safety. Each Federal agency has the responsibility to protect its own
critical infrastructures and ensure its ability to provide essential
services to the public. In addition, because most of the Nation's
critical infrastructures are owned and operated by the private sector,
Government agencies must follow the Y2K example in reaching out to
private industry to assist and encourage sensible infrastructure
protection efforts.
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Protecting Personal Privacy
As information technology transforms our Government and our economy, a growing challenge is how to gain the benefits from the new technology while
preserving one of our oldest values--privacy. In the online world, the Administration has encouraged self-regulatory efforts by industry. For
especially sensitive information--such as medical, financial, and children's online records--legal protections are required. To coordinate privacy
policy, the Administration created the position of Chief Counselor for Privacy within OMB's Office of Information and Regulatory Affairs.
This year has seen historic progress:
In the online world, under steady prodding by the Administration, the portion of commercial websites with privacy policies
rose from 15 percent to over 65 percent from 1998 to 1999. A public workshop last fall challenged industry to address concerns
about ``online profiling,'' in which companies collect data, in ways few people would suspect, about individuals surfing the
Internet.
When children go online, parents should give their consent before companies gather personal information. Websites aimed at
children must get such consent under the Children's Online Privacy Protection Act of 1998 and rules issued last year.
In new regulations, the Administration has emphasized its full support for the use of strong encryption to provide privacy
and security to law-abiding citizens in the digital age. Continuing programs to strengthen Government computer security also
provide new privacy safeguards for personal information held by the Government.
Progress on privacy will continue:
For medical records, this year will see historic, final rules that will legally guarantee key privacy protections: notice
of data uses; consent before records are used for non-medical purposes; patient access to records; proper security; and, effective
enforcement. The Administration will continue to support legislation that would include broader scope and enforcement authority.
The financial modernization bill signed by the President in November 1999 included important privacy protections. Notably,
consumers will have an absolute right to know if their financial institution intends to share or sell their personal financial
data, as well as the right to block sharing or sale outside the institution's corporate family. Last year, the Administration will
seek further protections for consumers in financial information, including choice about sharing within a corporate family.
The Federal Government will continue to build privacy protections into its own activities. Last year, for instance, all
Federal agencies successfully posted clear privacy policies on their websites. This year, among other initiatives, the
Administration plans to make ``privacy impact assessments'' a regular part of the development of new Government computer systems.
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5. Strengthen Statistical Programs: The Government spends more than $3
billion each year to produce statistical measures for decision makers in
both the public and private sectors. These data are used for everything
from monitoring the Nation's progress in the dynamic global economy, to
spotting important trends in public health, to projecting the impact of
future demographic shifts on the Social Security System. In 1999, the
Administration: (1) actively supported House passage of a bill to permit
limited sharing of confidential data among selected agencies solely for
statistical purposes; (2) significantly enhanced FedStats
(www.fedstats.gov) services; and (3) published innovative inter-agency
thematic reports, including America's Children: Key National Indicators
of Well-Being and Health, United States. The Administration will now
seek Senate passage of the legislation for statistical data sharing,
begin use of the recently revised Standard Occupational Classification,
publish a new thematic report on statistics related to the aging
population, and continue the phased implementation of the American
Community Survey to provide comparable demographic, economic, and
housing data for small geographic areas for use in distributing nearly
$200 billion annually. In 2001, the Administration will work to improve
the measurement of income and poverty; address key education, health,
and welfare data needs; and, strengthen measures of capital equipment,
services expenditures, and E-business.
6. Implement acquisition reforms: The Federal Government is the
Nation's largest buyer of goods and services, purchasing roughly $200
billion each year. In the past seven years, the Congress and the
Administration have implemented numerous acquisition reforms to
streamline the buying process and maximize the Government's buying
power. For example, agencies are using credit cards for small dollar
purchases instead of processing paper purchase orders to save
administrative expense and time. In 1999, the Government met its goal of
using credit cards for 60 percent of all purchases below $2,500. For
2000, the goal was increased to 80 percent, and all agencies are on
track to meet this goal. Agencies are also selecting contractors based
on past performance to save money and get better results. In 1999, 15
agencies established and are using contractor performance evaluation
systems to select high-performing contractors. In 2000, all major
agencies will have evaluation systems in place. Further, to obtain
desired performance and reduce cost overruns and schedule slippages on
the annual expenditure of $70 billion for capital assets (e.g.,
buildings, satellites, information technology), agencies are
implementing a rigorous capital programming process. Finally, agencies
are being encouraged to use performance-based service contracts which
improve performance and reduce price by describing desired outcomes in
measurable terms while leaving the ``how'' to the contractors'
ingenuity.
7. Implement electronic Government initiatives: New information
technologies can make Government easier to use. In December 1999, the
President articulated a vision for electronic Government. The
Administration will pursue three related strategies to increase access
to Government information, ensure privacy and security, increase agency
use of automation to transact services, and adopt crosscutting
electronic Government initiatives. First, citizens, businesses, and
governments need to trust that when they communicate electronically as
part of a Federal activity, their messages will be safe from
interference and fraud. By December 2000, agencies will issue at least
100,000 secure digital signatures to individuals to enable them to
exchange information with the Government in a private and tamper-proof
manner. Second, the Federal Government will develop a new clearinghouse
for Government information on the Web to demonstrate how common
standards can dramatically improve access to government information at
far less cost than current approaches. And third, agencies will create
new computer applications to allow citizens to transact more government
services electronically, beginning with the 500 most common Government
services and forms.
8. Better manage Federal financial portfolios: The Federal Government
currently underwrites more than $1 trillion in loans, primarily to
students, homebuyers, and small businesses. The Government can better
serve these customers and at the same time protect its interest in
obtaining efficient and timely
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repayment. At the end of 1998, $60 billion of this Federal portfolio was
delinquent--an increase of $8 billion from 1997. However, as the
Department of the Treasury implements its new statutory authorities
under the Debt Collection Improvement Act, collections are beginning to
increase. For example, in 1999, Treasury collected $2 billion through
``offsets'' of tax refunds and other payments--with more than $1 billion
representing delinquent child support obligations. In addition, the
Department of Justice collected more than $1 billion of delinquent debt
through its litigation program. In 2000, agencies should increase
collections and further reduce delinquencies by full implementation of
the Treasury debt collection offset and cross-servicing tools, by
increasing loan sales for delinquent debt, and by writing-off
uncollectible debt.
9. Align Federal human resources to support agency goals: Recognizing
that people are critical to achieving results Americans care about, the
Administration will undertake a strategic approach to human resources
management. First, the Office of Personnel Management (OPM) will help
agencies strategically assess their human resources to ensure a quality
Federal work force in the 21st Century. Among other things, in 2000, OPM
will complete the design of a prototype work force planning model that
will allow line managers to analyze their current work force and prepare
``what-if'' scenarios under a variety of recruitment, restructuring, or
mission change models. Second, OPM will work with agencies to ensure
labor-management initiatives to empower executives, line managers, and
especially employees to improve customer service and get mission
results. Third, OPM will encourage agencies to make better use of
flexibilities in existing human resource policies, systems, and
available tools. OPM will also submit legislative proposals, where
necessary, consistent with these human resource management strategies.
10. Verify that the right person is getting the right benefit: The
Administration will expand its focus on ensuring that administrative and
program payments are made correctly and on time. The Government-wide
strategy is first and foremost to make payments correctly up-front and,
secondly, to measure the extent of improper payments through the annual
financial and performance reporting process. The strategy also calls for
strong privacy and security protections in carrying out these goals. In
2000, OMB will issue guidance to agencies to ensure that the right
person is getting the right benefit, including, for example, principles
for authenticating identity, keeping address information up-to-date, and
verifying eligibility criteria. The Administration will also assist
Federal agencies in estimating the extent of, and addressing the
underlying causes of, improper payments. The Administration will work
with the Congress where legislation is needed to provide agencies the
ability to share information within the framework of the Privacy Act and
Computer Security Act.
11. Streamline and simplify Federal grants management: The
Administration will work to make it easier for State, local, and tribal
governments and nonprofit organizations to apply for and, as recipients,
report their progress on Federal grants. The inter-agency Electronic
Grants Committee and their Federal Commons initiative will be central to
a Government-wide effort to use electronic processing in the
administration of agencies' grant programs. OMB and the agencies are
also working to develop common applications and reporting systems for
grant programs, including consolidation of payment systems. We will also
identify statutory impediments to grants simplification and encourage
flexible legislation, like the Workforce Investment Act, which allows
Federal agencies to streamline the delivery of grants.
12. Capitalize on Federal energy efficiency: The Federal Government is
the largest single consumer of energy in the world. Every year, the
Government spends more than $4 billion to heat, cool, and power 500,000
Federal buildings. With this distinction comes the opportunity to save
energy, save taxpayers dollars, and protect the environment from harmful
greenhouse gases. Under the leadership of this Administration, the
agencies have already cut their energy use 17 percent from 1985 levels.
In 1999, the President issued E.O. 13123, Greening the Government
through Energy Efficient Management, setting tough new goals for energy
efficiency and giving agencies the tools they need to achieve those
goals. In 2000, agencies will take
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steps to markedly improve energy efficiency by maximizing use of
contracting tools, such as energy savings performance contracting;
purchasing energy efficient office products; taking advantage of cost-
effective renewable technologies and power from clean (or ``green'')
sources; and, using sustainable designs for new Federal construction. By
2010, agencies will cut energy use by 35 percent and reduce greenhouse
gas emissions by 30 percent--saving taxpayers over $750 million a year.
Improving program implementation
13. Modernize student financial aid delivery: The Higher Education
Amendments of 1998 created the Government's first performance-based
organization in the Department of Education's Office of Student
Financial Assistance (OSFA) to significantly improve the annual delivery
of $50 billion in financial assistance to nearly nine million students.
In 1999, the new results-oriented organization hired a chief operating
officer, assessed customer needs, developed a systems modernization
blueprint, issued a five-year performance plan, and reorganized the
staff into three service-oriented channels for students, schools and
financial institutions. It successfully field tested its application
software with ten schools and multiple Federal agencies in the first
phase of its pilot program. In 2000 and 2001, working with other
agencies, schools, students, and the commercial banking industry, OSFA
will focus on implementing critical areas of the systems modernization
plan, completing the personnel reorganization, expanding electronic
access to benefits and services, and simplifying data exchanges with
partners and customers.
14. Improve Department of Energy (DOE) program and contract
management: Because more than 90 percent of DOE's budget is spent
through large, long-term management contacts, good acquisition planning
and better project management after contract award are essential. For
example, DOE contracts with universities and other organizations to
operate and maintain facilities to clean up nuclear material and waste
sites, and with private sector firms to design, build, and operate
treatment, storage, and disposal facilities. The Administration is
emphasizing more cost-efficient, performance-based, fixed-price
contracts over reliance on cost reimbursement contracts, which have few
incentives for contractors to adhere to cost, schedule, and performance
goals. In 1999, DOE increased the number of contracts it competed and
added performance measures and incentives to others. It also created a
high-level project management office to track and review all projects
valued at $20 million or more; those that cannot meet cost, schedule or
performance goals will be placed on a ``Watch List'' to be monitored
more closely by the Deputy Secretary. In 2001, DOE will award 70 percent
of its support service requirements as performance based service
contracts. By 2003, two-thirds of DOE's facility maintenance contracts
will have been awarded competitively.
15. Strengthen the Health Care Financing Administration's (HCFA's)
management capacity: HCFA faces the formidable challenge to modernize
and operate as a prudent purchaser of health care in the fast-changing
health care marketplace, while also, and perhaps most important,
increasing accountability to its customers. The initiative has five
components: (1) management flexibilities (e.g., evaluation of personnel
needs and flexibilities); (2) increased accountability to constituencies
(e.g., creation of an outside advisory committee); (3) program
flexibilities (e.g., new authorities and greater use of existing
authorities to pay for services at market rates, enter into selective
contracts, and engage in competitive bidding); (4) structural reforms
(e.g., reengineering relationship between HCFA's central and regional
offices and between HCFA and HHS); and, (5) contracting reform (e.g.,
promoting competition in Medicare claims processing, improving
contractor oversight). In 1999, HCFA established a Management Advisory
Committee, which will include individuals with a wide range of private
sector, public sector, and academic experience. The bipartisan committee
will begin meeting in 2000 to provide guidance on ways to improve HCFA's
management, performance, and accountability. HCFA is also in the process
of assessing its current and ideal workforce skills mix, and developing
and validating a long-term human resources strategic plan. HCFA drafted
and sent to
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Congress its contracting reform legislative proposal, which is designed
to introduce competition into the Medicare contracting environment and
allow HCFA to select contractors from a wider pool. The President's 2001
Budget includes a new contractor oversight initiative to ensure that
contractors have appropriate controls in place. Other areas of focus for
2000 and 2001 include improving communications and coordination between
HCFA central and regional offices and HHS, and developing strategies for
making better use of HCFA's vast data resources.
16. Implement Department of Housing and Urban Development (HUD)
reform: In the mid-1990s, chronic problems at HUD led some to consider
abolishing the Department. Congress, the General Accounting Office, and
private agencies criticized the agency as unresponsive, having too much
red tape and little accountability, and plagued with unreliable data and
various systems that could not communicate with one another. HUD's
comprehensive reforms, begun in June 1997, are designed to realign
agency operations for results, including assuring that HUD-subsidized
tenants live in safe and well-managed housing. To date, HUD has
downsized staff to 60 percent of 1980 levels, and clarified the mission
of each employee; surveyed every public and HUD-assisted multifamily
project and advised owners of any documented deficiencies; cleaned up
much of the data in existing management and financial systems,
integrating many of the disparate systems where possible; and begun to
monitor subsidized tenants' eligibility and the correct amount of tenant
rental payments through cross checks with Social Security and other data
bases. By the end of 2001, HUD will reduce the share of public and
assisted housing with severe physical deficiencies by 10 percentage
points, reduce the share of units managed by poorly performing public
housing agencies by five percentage points, and will promptly complete
most enforcement actions on troubled privately owned subsidized housing
within 120 days of referral. HUD will begin surveying its customers
(e.g., Mayors, local HUD partners, public housing residents and other
customers) to determine how well HUD is doing and advise HUD on where to
improve. In 2000, HUD will save $200 million in overpayments of HUD
rental and operating subsidies by cross checking with Social Security
and other data bases for tenant income levels which determine both
eligibility and tenants' rent levels.
17. Reform management of Indian trust funds: The Department of the
Interior (DOI) is responsible for managing about $3 billion of funds
that the Federal Government holds in trust for Indian tribes and
individual American Indians, as well as the underlying land, timber, and
mineral assets from which these funds are derived. At the end of 1999,
nearly all of the roughly 300,000 financial account jacket files managed
by DOI for individual Indians had been cleaned up and 45 percent of
these were successfully converted to a commercial grade accounting
system. This effort is on track to meet the goal of converting all
remaining accounts by May 2000. All Tribal accounts have been managed in
a commercial grade system since 1995. In June 1999, DOI began piloting
its Trust Asset and Accounting Management System in Billings, Montana,
which will provide DOI field staff with the tools needed to properly
manage tribal and individual Indians' land and natural resources. At
this pilot site, trust asset data has been converted to the new system
and the results are being evaluated. The current goal is to convert the
remaining 213 sites to the new commercial system by December 2001. While
initial success in DOI's Indian Land Consolidation pilot program will
help sustain these management improvements by easing the paperwork
burden of administering trust fund accounts, enactment of legislation to
make this consolidation effort permanent is vitally important.
18. Implement Federal Aviation Administration (FAA) management
reforms: The safety of the flying public depends upon the FAA--its air
traffic controllers, safety and security inspectors, and information
technology. There are three major management reform initiatives which
will help the FAA improve its use of technology and prepare for future
challenges: acquisition; financial; and, personnel reform. With respect
to acquisition reform, FAA is in the process of implementing an
effective, systematic process for selecting, controlling, and managing
capital investments. On the financial reform side, the FAA con
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tinues to implement phases of a cost-accounting system which, when fully
utilized, will provide information to both itself and its users about
the value of the FAA's services and allow the agency to operate more
like a business. Finally, the FAA continues to evaluate the success of
its personnel reform efforts. In 2000, the FAA will link pay scales to
market rates and implement a system which ties pay to the achievement of
individual and agency performance targets. The agency will use its
existing legislative authority to create a performance-based
organization for Air Traffic Control (ATC) services; while the
Administration calls upon Congress to provide the additional authority
it needs to operate ATC as a business.
19. Implement IRS reforms: The IRS is modernizing its technology and
organizational structure, in part as mandated by the IRS Restructuring
and Reform Act of 1998, in order to ensure the fairness of tax
administration and improve the IRS's customer service, productivity, and
financial management. By the end of 2001, the IRS will be restructured
around four major customer groups with similar filing and compliance
characteristics (i.e., those with only wage and investment income, small
businesses and self employed, large and mid-sized businesses, and tax
exempt and government entities). Over time, this will enable the IRS to
tailor staff expertise, services, and enforcement techniques to specific
taxpayer groups. This will be the most significant restructuring of the
IRS's organization and work practices since 1952. The IRS is also
undertaking a technology modernization program which is designed to
replace the IRS's 1960s era core databases with modern systems. This
will enable significant improvements in technology support to customer
service and compliance employees. It will also prepare the IRS for the
wholesale transition to electronic filing and data exchange. The IRS is
also implementing a series of initiatives to provide immediate customer
service improvements. For example, it has expanded the hours when toll-
free assistance is offered, set up four local citizen advocacy panels to
ensure taxpayer input to local IRS officials, offered new electronic
filing and payment options, and strengthened its taxpayer advocate
service (which gives taxpayers an option outside of normal IRS processes
to resolve difficult issues). Its electronic filing system earned a 74
American Consumer Satisfaction Index (ACSI) score, placing it above the
average customer satisfaction score for private sector services. During
2000, the IRS will build on these efforts with new initiatives directed
at improving the responsiveness of customer service representatives,
expanding Spanish language toll-free assistance, and enhancing outreach
to new small businesses to help them better understand and meet their
tax obligations.
20. Streamline the Social Security Administration's (SSA's) disability
claims process: SSA is in the midst of a multi-year project to improve
service delivery for the millions of individuals filing for, or
appealing decisions on, claims for disability benefits. To increase
accuracy and consistency in decision-making, the agency has provided all
of its adjudicators uniform training and instructions clarifying complex
policy areas, as well as instituting an improved quality assurance
process. SSA is also testing a redesigned disability claims process on a
prototype basis in 10 States. The new process will eliminate repetitive
steps and increase claimant interaction with SSA at both the initial
claim and hearing levels. If the prototype proves successful at
providing claimants with the correct decision earlier in the process,
nationwide implementation will occur beginning in 2002. Finally,
management improvements scheduled to be fully implemented at the Office
of Hearings and Appeals in 2001 are expected to reduce hearing
processing times from an average of 316 days in 1999 to 208 days in
2002. The combined effect of all of these changes will be to improve the
accuracy of initial decisions and provide a quicker and more user-
friendly process for those claimants who pursue appeals.
21. Revolutionize DOD business affairs: Following the end of the Cold
War, the United States began a major reduction in military forces. DOD's
cuts in infrastructure costs, however, have not kept pace. To make
further cuts, DOD plans to change the way it does business. The 1997
Defense Reform Initiative provided a strategic blueprint of how to adopt
better business processes, pursue commercial alternatives, consolidate
redundant
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functions, and streamline organizations. Since the Defense Reform
Initiative report, significant effort and progress has been made.
Examples include:
Competition forces organizations to improve quality, reduce
costs, and focus on customers' needs. DOD employees perform
many commercial activities which could benefit from
competitive bidding. DOD expects its competitive sourcing
process will save approximately $11.2 billion from 1997 to
2005. These savings are reallocated to other defense
priorities, including force modernization throughout the 2001-
2005 period.
The vast majority of official purchases are made with a
special credit card--rather than wasting time and money
writing a paper contract. From just less than 800,000
purchases made with the purchase card in 1994 to 7.5 million
during 1998, the card truly has become the preferred method of
obtaining goods and services costing less than $2,500.
Today, paper is still part of DOD's business systems and
culture. The Department's goal is to make all contracting
(i.e., weapons systems, spare parts, and installation level
maintenance) paperless by 2001. Sixty-seven percent of the
Department's transactions are currently paperless and the
Department is well on its way to achieving its goal of 90
percent in the year 2000.
In 1991, DOD was operating 324 separate finance and
accounting systems. Through the summer of 1999, that number
dropped to 102 systems; a 69-percent decrease. By 2003, the
Department expects to reduce the number of systems to 32,
representing the largest financial system overhaul ever
undertaken by DOD.
22. Manage risks in building the International Space Station: The
United States has the lead role in building the International Space
Station, one of the most complex international projects ever undertaken
in peacetime. The recent trend of annual budget growth has been curbed
in the 2001 budget--a major success--but NASA must continue to manage
the risks of completing assembly and reduce the potential for future
cost growth. In 1999, the first elements of the Space Station had a year
of successful in-orbit operation, and the program made good progress,
albeit slower than planned, in preparing many other key elements for
launch. The year 2000 is critical for the Space Station--with plans for
the beginning of permanent human presence in space, and the initiation
of research aboard the orbiting laboratory. The program also continues
the transition from development activities to orbital operations and
research. The program will control cost growth by balancing requirements
within available resources, and will continue to address cost and
schedule performance problems in its key contracts, strengthen contract
management and cost controls, and further reduce risks from potential
Russian shortfalls.
23. Improve security and management of overseas presence: Since the
end of the Cold War, the world's political, economic, and technological
landscape has changed dramatically, but our country's overseas presence
has not adequately adjusted to this new reality. Thirty Federal agencies
now operate internationally, yet the condition of U.S. posts and
missions abroad is unacceptable. In 1999, in the aftermath of the
African embassy bombings, the Administration formed the Overseas
Presence Advisory Panel to consider the future of our Nation's overseas
representation, to appraise its condition, and to develop
recommendations on how best to organize and manage our overseas posts.
In 2000, the Administration will be working to ensure the thorough
review and implementation, as appropriate, of the Panel's
recommendations, including an examination of the U.S. Government's
overseas needs and the current structure of financing and management for
overseas facilities. We will also assess the need for additional
security enhancements, including physical security upgrades, sound
capital planning for the construction of new diplomatic and consular
facilities, and begin to move toward a common information technology
platform for all of our agencies abroad.
24. Reengineer the naturalization process and reduce the citizenship
application backlog: Immigration and Naturalization Service (INS)
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is reengineering the naturalization process to streamline and automate
operations, while simultaneously reducing a backlog of more than 1.8
million applications for citizenship. In 1999, INS reduced the backlog
by more than 500,000 applications and the average processing time
between application and naturalization of qualified candidates has been
reduced from 27 months in 1998 to 12 months in 1999. The goal is to
reduce processing time to six months by the end of 2000.
Using Inter-Agency Groups to Get the Job Done
To achieve the Administration's goal of making fundamental change in
the operations of Government, inter-agency groups have been used
extensively to lead crosscutting efforts. These groups draw together
operational, financial, procurement, integrity, labor-relations, and
systems technology experts from across the Government. The groups
establish Government-wide goals in their areas of expertise, and they
marshal the resources within individual agencies to meet these goals.
Several of these groups were formed for the first time by this
Administration, including the National Partnership for Reinventing
Government, the President's Management Council, and the National
Partnership Council (see Table 31-3).
The National Partnership for Reinventing Government (NPR): President
Clinton created the NPR in March 1993 to create a Government that works
better, costs less, and gets results Americans care about. He asked Vice
President Gore to lead this inter-agency task force. In 2000, NPR will
continue its work to make agencies that have the most contact with the
public to be more performance-based, results-oriented, and customer-
driven. In doing this, NPR will partner with agencies to achieve the
following outcomes:
Customer satisfaction with Federal services equal to or
better than the business services sector, as measured by the
ACSI.
An infrastructure to enable Americans to have access to all
Government information and be able to conduct all major
service transactions on line by 2003.
NPR will also work with local and State governments and the private
sector to:
achieve dramatic reductions in gun violence;
help States achieve their goals of universal health insurance
for children; and,
provide all Americans a seamless learning and employment
system to get the job skills they need to be successful in the
21st Century.
More information on NPR is available at its website, www.npr.gov.
The President's Management Council (PMC): The PMC consists of the
Chief Operating Officers of all Federal departments and the largest
agencies. The PMC provides leadership for the most important Government-
wide reforms. Council priorities include: supporting labor-management
partnerships; leading GPRA implementation; identifying criteria and
recommending methods for agency restructuring; supporting electronic
commerce and performance-based contracting; facilitating development of
customer service standards; and, improving Federal energy efficiency.
The National Partnership Council (NPC): President Clinton established
the NPC in October 1993 to enlist the Federal labor unions as allies to
reinvention and to shift Federal labor relations from adversarial
litigation to cooperative problem solving. Members of the NPC include:
representatives of Federal employee unions and Federal managers and
supervisors; the Federal Mediation and Conciliation Service; the Federal
Labor Relations Authority; the Office of Personnel Management; OMB; DOD;
and the Department of Labor. In 1999, the Council continued to sponsor
training conferences aimed at helping unions and agencies build the
skills they need to establish effective and successful partnerships. The
Council also sponsored a major research project involving eight Federal
agencies to study the connection between labor-management partnership
and bottom-line improvements in agency performance. In 2001, the Council
will continue to build on the findings of its research project and,
through its training programs, focus on strategies that will both
stimulate best practices and overcome barriers to partnership. More
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information on the NPC can be found on its website, www.opm.gov/npc.
Table 31-3. Major Inter-Agency Groups
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Council Names/Membership Recent Activities/Future Priorities
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Chief Financial Officers (CFO) Council: The CFOs and ............. Significant accomplishments include: a
Deputy CFOs of the 24 largest Federal agencies and steady increase in the number of CFO Act
senior officials from OMB and Treasury. The Council, agencies receiving clean opinions on
through its Committees, addresses such issues as their financial statements; timely
financial statements and standards; financial issuance of the Government-wide audited
systems; grants; human resources; debt management; financial statements for the second year
and entrepreneurial Government. in a row; the establishment of a Program
http://www.financenet.gov Management Office under the Joint
Financial Management Improvement Program
to develop financial systems requirements
and testing vehicles; and the development
of qualification and classification
standards for certain Federal financial
positions based on core competencies and,
the completion of a comprehensive review
of the Franchise Fund pilot program.
..........................................
In 2000 and beyond, the Council intends
to build on these accomplishments,
continuing to seek clean audit opinions
on agency, department and Government-wide
financial statements; improvements in
security and proficiency of financial
management systems; and improvement in
professional education and development of
the Federal financial workforce. The
Council also will support Administration
efforts to seek permanence for the
Franchise Fund pilot program.
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Chief Information Officers (CIO) Council: The CIOs ............. In 1999, Council accomplishments
and Deputy CIOs for 28 major Federal agencies, two included the successful transition of
CIOs from small Federal agencies, senior officials Federal systems to year 2000; improved
from OMB and representatives from two information capital planning capabilities; efforts to
technology boards. The CIO Council develops further enterprise interoperability;
recommendations for information technology pilots to implement work force core
management policy, procedures, and standards; competencies; and, increased security
identifies opportunities to share information awareness.
resources; and assesses the Federal Government's ..........................................
needs for an information technology work force. In 2000, the Council intends to build on
http://cio.gov its progress promoting infrastructure to
provide common access solutions; expand
and explore opportunities for increased
interaction and outreach with the
worldwide IT community to disseminate and
share information; support service
delivery by working on security and
privacy approaches that advance
appropriate information access,
exchanges, and protection, and support
electronic commerce; develop and
implement strategies for recruitment,
retention, and development of IT
professionals; and, promote the effective
integration of IT management with
agencies' missions and processes.
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President's Council on Integrity and Efficiency ............. 1999 accomplishments include:
(PCIE): The Presidentially appointed Inspectors identification of billions of dollars of
General (IGs), senior officials from OMB, and other Federal funds that could be reallocated
key integrity officials. to better use by Government managers;
investigations resulting in successful
Executive Council on Integrity and Efficiency (ECIE): prosecutions of thousands of wrongdoers;
The 30 IGs appointed by agency heads, OMB, and other investigative and civil recoveries of
key integrity officials. http://www.ignet.gov more than $1 billion; and,
disqualification of thousands of
unscrupulous businesses or individuals
from receiving Government contracts or
participating in Government programs. The
IG's also collaborated on efforts to
address emerging issues with systems
security, to enhance financial management
practices to enable clean opinions of
audited agency financial statements, to
continue to foster GPRA principles, bring
to successful completion intensive year
2000 activities, and to strengthen and
enhance inter-agency training academies
for auditors and criminal investigators.
..........................................
Priorities for 2000 include developing a
strategic plan to focus the Council's
efforts on major crosscutting issues to
better leverage IG resources across the
Government.
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Electronic Processes Initiatives Committee (EPIC): ............. In 1999, EPIC helped implement the
Senior policy officials from DOD, GSA, Treasury and Government's strategic plan for
OMB. EPIC's role is to further the use of electronic electronic purchasing and payment. EPIC
technologies and processes within Government to sponsored user groups to help resolve
improve service delivery and program efficiency. challenges in the implementation of the
http://policyworks.gov/org/main/me/epic/ Government's SmartPay purchase and travel
card program. EPIC also continued the
development of a card-based approach for
processing intra-governmental payments at
lower cost.
..........................................
In 2000, EPIC will continue to monitor
implementation of the Access America for
Students initiative, which provides a one-
stop shopping and information site for
student loans. EPIC will also sponsor an
effort to expand use of the Government's
Central Contractor Registration, through
which vendors can, in one place, register
payment information and other data
necessary to do business with the Federal
Government.
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Federal Credit Policy Working Group (FCPWG): ............. In 1999, the FCPWG completed revisions
Representatives from the major credit and debt to Government-wide policies to implement
collection agencies and OMB. The FCPWG provides the Debt Collection Improvement Act,
advice and assistance to OMB, Treasury, and Justice including a revision to Federal program
in formulating and implementing Government-wide write-off policy. With the support of the
credit policy. FCPWG, SBA completed its first loan asset
http://www.financenet.gov/ financenet/fed/fcpwg sale program and HUD began centralizing
its sale program. The GSA portfolio
management schedule awarded over 50
contracts for work in asset valuation,
due diligence, and loan sales.
..........................................
In 2000, the FCPWG will focus on
Internet applications to improve customer
access and modernize program financial
systems, continue to build a government-
wide loan asset sales program, and
monitor the implementation of the Debt
Collection Improvement Act, in particular
referral of debt more than 180 days past
due to the Treasury Department for
collection.
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Procurement Executives Council (PEC): Senior ............. In 1999, specific accomplishments
procurement executives from major Federal agencies include: establishing a Government-wide
and senior OMB officials. The PEC serves as a forum Acquisition Intern Program; developing an
to improve Federal acquisition by leveraging inventory of desired skills and
procurement influence and knowledge. attributes of contracting professionals;
and, developing draft guides for
rotational assignments of contracting
officers to industry organizations.
..........................................
By 2001, the PEC intends to improve the
intern program; use the inventory of
contracting officer skills and the
rotational assignment guides to improve
training; establish a set of agency
acquisition system performance measures;
improve small business procedures; and
develop a single point on the Web that
makes Government solicitations freely
available to any interested entity.
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Inter-agency Alternative Dispute Resolution Working ............. In 1999, the Working Group conducted
Group (ADR): The Attorney General, representatives more than 50 Government-wide training
of the heads of all Cabinet Departments, and others sessions, meetings, and colloquia to
with significant interest in Federal dispute promote and encourage the use of ADR in
resolution. President Clinton established the ADR agencies.
Working Group in May 1998 to assist Government ..........................................
agencies in making greater use of consensual methods In 2000, the ADR Working Group will
for resolving disputes, including mediation, neutral produce a detailed report on agency
evaluation, arbitration, and other processes. success stories, lessons-learned, best
http://www.financenet.gov/ financenet/fed/iadrwg practices and recommendations, and it
will continue to mentor agencies in the
development of ADR programs.
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Joint Financial Management Improvement Program ............. In 1999, JFMIP published financial
(JFMIP): A joint effort of GAO, OMB, Treasury, and system requirements for Core Financial
OPM, with a rotating representative from another Management, Human Resources and Payroll,
agency. JFMIP was established 50 years ago to Direct Loans, and Travel, and prepared
encourage and promote government-wide sharing and drafts for Seized Property and Forfeited
exchange of information concerning good financial Assets, Guaranteed Loans, Grants, and
management techniques and practices. Property; established a testing and
http://www.financenet.gov.financenet/fed/jfmip/ certification process for commercial off-
the-shelf (COTS) software supporting core
financial management functions;
established a website that supports the
testing process, including system
requirements, the test, and information
on tested and certified qualified COTS
software; and issued guidance on core
competencies in financial management.
..........................................
2000 priorities are to: prepare
financial system requirement publications
for financial management systems where
publications do not exist or are
outdated; continue testing COTS software
supporting core financial management
functions; offer testing for Federal
agency systems that are used to provide
core financial servicing for other
agencies; incorporate new requirements in
the core financial management software
test; and share information on financial
management systems and best practices
through the web-based knowledge base.
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Small Agency Council (SAC): Principal management ............. It speaks for the member agencies on a
officials from 81 agencies with less than 5,000 FTE. variety of issues and proposals with OMB,
The group was chartered to improve management OPM, and GSA. It annually sponsors a
effectiveness through education, exchange of comprehensive training program open to
information, self-help, and cooperation. all member agencies, covering matters of
http://www.sac.gov current interest, such as Y2K, preparing
annual performance reports, and
alternative dispute resolution. In 1999
more than 1,500 attended these sessions.
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Human Resources Technology Council (HRTC.) Under the ............. In 1999, projects completed include an
sponsorship of OPM, the HRTC consists of human Official Personnel Folder Data
resources, information technology and Federal Dictionary, and a Government-wide Human
financial decision makers. The HRTC operates as a Resources Information Study (now
guiding body on government-wide information formalized as a JFMIP Financial Systems
technology issues affecting personnel and payroll Standard).
matters. ..........................................
http://www.opm.gov/hrtc In 2000 the HRTC will lead an effort to
design and develop a Human Resources Data
Network, recommended in the study noted
above, which will facilitate the
movement, storage and retrieval of HR
data on employees, and will eliminate any
future need for paper-based official
personnel records.
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