SELECTED ASPECTS OF THE BUDGET This part of the budget explains several topics that help place the budget in perspective. It discusses: • relationship of budget authority to outlays; • fiscal activities outside the Federal budget, —outlays of off-budget Federal entities, –Government-sponsored enterprises, —guaranteed loans, and —tax expenditures; • the relationship of budget funds to changes in Federal debt; • the differences between the original budget estimates of outlays under relatively uncontrollable programs and the actual outlays for these programs; and • the differences between the original budget estimates of receipts and the actual receipts. RELATIONSHIP OF BUDGET AUTHORITY TO OUTLAYS The Congress must provide budget authority, generally in the form of appropriations, before Federal agencies can obligate the Government to make outlays. For 1979, $568.2 billion of new budget authority is proposed for those Federal activities included in the budget. In addition, $16.1 billion in new budget authority is proposed for those Federal entities that are excluded from the budget. Of the total amount proposed for on-budget Federal entities for 1979, $366.9 billion in new budget authority for on-budget Federal agencies will require congressional action. The remaining $201.2 billion will be available under existing laws. The latter authority includes trust fund receipts, which in most programs are automatically appropriated under existing law, and interest on the public debt, for which budget authority is automatically provided under a permanent appropriation enacted in 1847. Budget authority for most off-budget Federal entities will be available under existing law. Not all of the new budget authority for 1979 will be obligated or spent in that year." * Budget authority for most trust funds authorizes the expenditure of the receipts from special taxes and contributions and from Federal fund payments to the trust funds. The receipts are to be * This subject is discussed more fully in a separate report, “Balances of Budget Authority", that is published by the Office of Management and Budget shortly after the Budget is transmitted. used as needed over a period of years for benefit payments and other purposes specified by law. • Under longstanding budget policy, budget authority for major construction and major procurement projects covers the entire cost anticipated at the time the projects are initiated even though costs will be incurred and outlays made over a period extending beyond that fiscal year. • Budget authority for the subsidized housing programs is equal to the Government's maximum contractual obligation to pay subsidies under contracts that may extend over periods of up to 40 years. • Budget authority for many direct loan programs provides financ ing for a period of years; budget authority for many insurance and guaranteed loan programs consists of amounts to be used only in the event of defaults or other claims made under the programs. As a result of these factors a substantial amount of budget authority carries over from one year to the next. Most of this is earmarked for specific uses and is not available for new programs; some of it may never be obligated or spent. NOTE: The difference between the total budget figures and federal funds shown in brackets consists of trust funds and interlund transactions between fund groups. As shown in the preceding chart, $139.5 billion of the outlays for 1979, 27.9% of the total, will be made from budget authority enacted in previous years. Furthermore, $207.5 billion of the new budget authority proposed for 1979, which is 36.5% of the total amount proposed, will not result in outlays until future years. The relationships between budget authority, obligations, and outlays are discussed further in Part 7 of the Budget and displayed in table 5 of Part 9. Once budget authority is provided, the Congressional Budget and Impoundment Control Act requires that any available amounts withheld from use must be reported to the Congress in rescission or deferral messages. The Congress may require release of these funds by overturning the proposed deferral of budget authority or by not taking action on the proposed rescission.? Available through current action by Congress: Appropriations. Rescissions pending - Appropriation requests. Supplemental requests. Under existing legislation... 7.3 * 0.5 0.7 Civilian agencies 16.9 4.2 2.3 Subtotal, available through current action of the Congress. 317.5 327.4 366.9 Available without current action by the Congress (permanent authorizations): 3 Other 155.2 9.8 174.5 12.2 192.3 55.4 17.1 -63.6 Total budget authority ---- 465.2 502.9 568.2 See footnotes at end of table. 2 See discussion in Part 7 of the Budget. BUDGET AUTHORITY-Continued (In billions of dollars) Description 1977 actual 1978 1979 estimate estimate MEMORANDUM Available through current action by the Congress--- * 9.9 16.1 14.0 Total, off-budget Federal entities .. 10.0 14.1 16.1 Total budget authority including off-budget Federal entities. 475.2 517.0 584.3 *$50 million or less. Includes allowances for civilian and military pay raises for Department of Defense. 3 Allowances for relatively uncontrollable programs with permanent authorizations are estimated at zero. FISCAL ACTIVITIES OUTSIDE THE FEDERAL BUDGET The budget does not include a number of fiscal activities of the Federal Government that result in spending similar to budget outlays. One major exclusion—the outlays of off-budget Federal entities :_is discussed in some detail below. This is followed by a discussion of the Government-sponsored enterprises, which are outside the scope of the budget because of their private ownership.* Guaranteed loans and tax expenditures, which also have significant effects on the economy, are discussed subsequently. The regulation of economic activity may have similar effects by requiring the private sector to make expenditures for specified purposes, such as safety and pollution control. These effects cannot be quantified satisfactorily and are not discussed in this section. The off-budget Federal entities and the privately owned, Government-sponsored enterprises primarily carry out loan programs. Guaranteed loans are likewise a part of federally assisted lending. The following table summarizes Federal credit activity by showing the amounts outstanding of Federal and federally assisted loans: direct loans by Federal agencies included in the budget; direct loans by offbudget Federal entities; guaranteed loans; and loans by Governmentsponsored enterprises. 3 Financial statements for these entities are published in the Appendix, Budget of the United States Government, Fiscal Year 1979. See Part IV, "off-Budget Federal Entities." For financial statements, see the Appendix, Part Vi, “Government-Sponsored Enterprises." |