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to the consolidation of services, activities, and functions or the abolition thereof.

Senator HOEY. What I was getting at was this: If the Comptroller General's office made an expenditure analysis of each agency in the executive branch of the Government, that would furnish the facts upon which to make recommendations or to decide as to elimination or restrictions or abolishing it, would it not?

Mr. LAWTON. Well, Senator, I am not sure it would necessarily go that far. It might lead to it.

But, on the other hand, it might simply lead in a great many instances to a determination as to whether the operation which is being performed, which is on the statute books, which is being performed by a specific agency, is being effectively and efficiently performed by that agency, and not go into the question of whether that particular agency is the one that should be performing it, and second, whether the function ought to be performed at all.

That phase of it is covered by part of this bill. The bill embraces two functions. First, the organizational study, and second, the methods study. This would deal with the methods, it seems to me, more than it would with the organizational side.

Senator Hory. What I was getting at was whether or not there would be duplication in the study required to make it a basis for this work. Now, in our examination of the Comptroller and his representatives, he was pointing out what an extensive job this would be.

Mr. LAWTON. That is correct.

Senator Howy. And that it would take a vast staff to perform it, and all that. And, I was wondering if, under this bill and then likewise under the measure now in operation in the House where they are building up a staff for the Appropriations Committee to investigate all of this thing, we would not be getting facts in all three of these things upon which to predicate either recommendations like this bill provides for changes and all that or on this to suggest the analysis of the expenditures to show where it is going and how? Would we not be duplicating the thing in making that study? Would it not be possible to have one study as a basis upon which these recommendations could be made by this commission, or would it be necessary for each one of these agencies to go over the same matters and get up all these facts as a basis for either showing the condition or making recommendations?

Mr. LAWTON. Of course, that is a danger that you face. I mean where the same sort of authority is in two or three or four or five places, as it would be if this bill were enacted. They would have a part of the same authority that the Comptroller has; it would be a part of the same authority that your committee has and the House committee has and that the Byrd committee has.

Senator Hoer. Under this bill, the commission could not make a recommendation of much value without having a study made. They would have to have a study made of all this, would they not?

Mr. LAWTON. I think you have to separate it a little bit. They would make organizational proposals or proposals for elimination, without necessarily making a study of the methods. Now, if they made a study of the methods, of course, it might be necessary in some of their proposals to have a study of methods.

Senator FERGUSON. Do you claim that your Budget office is carrying out the same function today as this commission would carry out if appointed?

Mr. Lawton. We are doing some of the things that this commission would do, but this question

Senator FERGUSON (interposing). Does the Budget undertake to survey all departments, all agencies, to see whether they are economically and efficiently operated, and, if so, how many people have you working in that field?

Mr. LAWTON. Senator, we do not attempt to survey each and every operation of every agency in Government. We could not possibly do it with the staff we have.

Senator FERGUSON. I understand the Government has gotten so large that it is impossible to survey it to ascertain if it is efficienteither efficiently or economically being operated?

Mr. LAWTON. That is a matter of degree. You mean if every operation in government is at the minimum cost per output-per unit of output, that job

Senator FERGUSON (interposing). That is, of course, what business tries to do, does it not? And, we would consider that any business that could not do it would fail.

Mr. LAWTON. I doubt if business does it continuously. They do it sporadically in some cases. They are always studying methods generally.

If you will permit me, I will give you a little example of the way we operate.

In the case of activities that cut across departmental lines, such as the making of pay rolls, the handling of personnel actions, the paper work in connection with personnel, the administrative examination of vouchers, things that are common to every department, we do study those and seek out the best methods of operation, then apply that as an across-the-board proposition to all agencies.

Senator FERGUSON. Let us take an example, and maybe we can run it down.

Take an OPA office in Detroit. Who is there that determines how many employees there should be in that to do the job that is to be done? Does your office do it in fixing the budget?

Mr. Lawton. No; we do not in the case of an individual office such as Detroit.

Senator FERGUSON. All right. Now, there is a regional office of that same organization in Cleveland. Does the Budget look over that regional office and say, "To do this job you need so many employees? That they need so many employees to do the job that the statute requires? Does the Budget Director's office do that?

Mr. LAWTON No; it has not done it.

Senator FERGUSON. Now, we will come down to Washington where the general office of the OPA is. Does the Budget Director go in and say, “You need so many employees in this office to operate it and carry out the intent of this stature?

Mr. LAWTON. We have the determination of the number of people that are required by the OPA as an entirety in Washington, in the field, in the sum total of its regional offices, and in the sum total of its State offices.

you not?

Senator FERGUSON. How can you possibly do that if you do not make a survey?

Mr. LAWTON. We have made surveys. Senator, you asked the question whether we specifically took a particular office and determined it each time we made the budget. What we have done in connection

Senator FERGUSON (interposing). Take the OPA budget. Did you determine how many men or women or both were necessary to perform the functions of the act creating the OPA, or the Executive order?

Mr. LAWTON. Yes.
Senator FERGUSON. Then, you had to make a survey,

did Mr. LAWTON. Not of every office; no. We had to make some sample surveys of operations which we have done. We made surveys in the central section of the country. We made surveys in the eastern section of the country, and some in the Far West offices.

Senator FERGUSON. Well, now, let us take the WPB. They have 30 miles of files. They want to make a history of the work of the War Production Board. Who determines in your office, to set up a budget, how many men it will take to write that history?

Mr. LAWTON. The examiners who handle the appropriation for liquidation of WPB.

Senator FERGUSON. Do you have authority to say, or do you say, that a history is or is not essential, and therefore we will or will not write a history?

Mr. LAWTON. We have the authority to include in the Budget estimates a provision or an amount for the carrying on of the historical function to write a history.

Senator FERGUSON. What I am trying to get at is whether or not you are performing the function that this commission, if appointed, would perform, or whether it is such a large task that you cannot perform it.

Mr. LAWTON. With the present staff of the Bureau of the Budget we cannot make a current survey, a regular survey, of every single operation in the Government. What we have done, in addition to making these studies on items that affect all agencies across the board, is to develop certain methods of operation, one of them being a worksimplification program which we will take to an agency, get a group of its people, and instruct them in the method of operation; and they in turn will go through their agency and make such studies and analyses as are necessary.

That sort of program operates on mass operations, and I think you will find in the Post Office hearings before the Appropriations Committee that it saved considerable money in the Post Office Department this year.

Senator FERGUSON. I will give you another example to see whether the Budget Director comes in on this. At one time the Congress was receiving a great amount of mail from the veterans on the dischargethe working of the merit system, the point system. The War Department undertakes to send over to each Senator and each Congressman a request that if they want their mail answered, to send that mail over to the War Department and it will be answered.

Now, there was a function I assume that was never contemplated when we passed the budget for the War Department, yet it would take a great amount of personnel to perform that.

Now, before the War Department did that, would they have to come to the Budget and ask for money to do that particular task, or can they just do it?

Mr. LAWTON. If they had the funds to do it and they could go ahead and perform that sort of operation. In that particular operation, I do not believe, however, that it would be such an increase in the War Department's mail or mail-handling function that it would cause them a great deal of additional expense, because a great many of those inquiries would have been directed from the Capitol to the War Department for a report, and the War Department would probably have required just as much staff and just as much time in sending those reports to the Capitol as they would in preparing the letters themselves.

Senator FERGUSON. Well, it was asked here—at least Governor Thye this morning asked this question along this line—that the Government agency would go ahead, use up all the money that has been appropriated, pay no attention to its severance pay idea, and then come in at about the end of the third quarter and say, We are out of funds; we want more funds."

Now, is that supervised by the Budget Director? Is he watching monthly so that these people are operating just within their budget, or is he just waiting until it comes over and he finds that they need more money, and then he approves the deficiency bill and it comes over to Congress?

Mr. LAWTON. He makes a quarterly apportionment of appropriations, which governs the rate of spending or obligation of the appropri tions, at the beginning of the year.

Senator FERGUSON. How could they possibly get a deficiency if he does that?

Mr. LAWTON. Very easily, because the apportionments for all four quarters are not necessarily equal. They are based on conditions as they occur.

Senator FERGUSON. Then he is really the one that violates the budget?

Mr. LAWTON. No. You do not violate it until you have actually overrun your appropriation, and in most of these instances you have not overrun.

Senator FERGUSON. Do you claim if you come to Congress and ask for a year's appropriation budget amount, for a year's appropriation, and you use it in 9 months there has been no violation?

Mr. LAWTON. Well, I would not make that flat statement. I would say it depends a great deal on the type of appropriation. First, of course, whether it is subject to the antideficiency act, and, second, whether conditions have so changed either by legislation

Senator FERGUSON (interposing). Who determines the conditions? You do not come back to Congress during this period and say to the Appropriations Committee or to Congress, “Things are changing, and we are going to need more money." You wait until

You wait until you send up the appropriation bill, the deficiency appropriation bill. Mr. Lawton. Well

, those, of course, may come up at the beginning of a session, which is the middle part of the fiscal year. They may come up later on in the fiscal year. The question of the Pay Act which which I discussed a little earlier

Senator FERGUSON (interposing). When do you learn that there is going to be a deficiency request on these deficiency appropriations?

Do you authorize the expenditure, or does the agency just go ahead and use it and report it?

Mr. LAWTON. We apportion the funds; at the beginning of this year we knew that practically every appropriation that had people subject to the Classification Act would run at a greater rate than the appropriations in the annual bill would permit.

Senator FERGUSON. Now, when did you say you learned that?

Mr. LAWTON. We learned it as soon as Congress passed the Pay Act and gave the 14-percent increase to the people under the Classification Act. And, the arrangement was similar to the one that has been in existence under both the first Pay Act increase and the overtime pay before that. We would wait until the middle of the year, and then submit the supplemental estimate to the Appropriations Committee.

Senator FERGUSON. Now, how do you treat this terminal leave? We find that the OPA needs $7,000,000 for terminal leave pay that has not been taken care of in the past appropriations. They have already paid out some-well, it is either 7,000,000

Mr. LAWTON (interposing). Seven and a half.
Senator FERGUSON. Seven and a half?
Mr. LAWTON. Yes.

Senator FERGUSON. So, that makes a cost of $14,000,000 for terminal leave. Now, do you anticipate that when you are requesting appropriation, or do you wait until the termination, like we find now and find that we have a deficiency of 7% million dollars?

Mr. LAWTON. We did not in that case-anticipate the liquidation of the OPA. The estimate submitted last year—that is, the estimate that was submitted by the President was for the operation of the OPA through the full fiscal year.

Senator FERGUSON. Do I understand then that you did not anticipate that it may be terminating and liquidating at that time? That it would be going full blast up to the 30th?

Mr. Lawton. The estimate we submitted to Congress was for a going operation through the fiscal year. The Congress appropriatedand so indicated in its appropriation-enough money to operate the OPA for 8 months at the going rate, with the idea that conditions might change, with the war having come to an end that decontrols might take place, and that there might not be an 'extension of the rent act, and so forth.

Senator FERGUSON. Well, do I understand, then, that the Budget Director is responsible for the efficiency and the economy in Government, or is the agency itself responsible to Congress?

Mr. Lawton. I would say it was, in part, a joint responsibility. The agency is responsible for its operation under the funds which have been granted to it by the Congress.

Senator FERGUSON. Well,
Mr. LAWTON (interposing). Now, the Budget Bureau-

Senator FERGUSON (interposing). You come here as the Budget Bureau and tell us that you have approved this, in effect. It is the Budget Bureau's estimate. Isn't that true?

Mr. LAWTON. The estimates submitted to the Congress for the operation of any agency are not the Budget Bureau's estimates. They are the President's estimates. The President is the only one authorized to submit them. We prepare them for him.

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