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GENERAL ACCOUNTING OFFICE

STATEMENT OF ELMER B. STAATS, COMPTROLLER GENERAL OF THE UNITED STATES

ACCOMPANIED BY:

ELLSWORTH H. MORSE, JR., ASSISTANT COMPTROLLER GENERAL, POLICY AND PROGRAM PLANNING

ADOLPH T. SAMUELSON, ASSISTANT COMPTROLLER GENERAL, DOMESTIC PROGRAMS

PAUL G. DEMBLING, GENERAL COUNSEL

PHILIP S. HUGHES, DIRECTOR, OFFICE OF FEDERAL ELEC-
TIONS

OYE V. STOVALL, DIRECTOR, INTERNATIONAL DIVISION
MILTON J. SOCOLAR, DEPUTY GENERAL COUNSEL AND ACTING
DIRECTOR, EQUAL EMPLOYMENT OPPORTUNITY

WILLIAM N. CONRARDY, DIRECTOR, OFFICE OF PROGRAM
PLANNING

CLERIO P. PIN, DIRECTOR, OFFICE OF ADMINISTRATIVE PLAN-
NING AND SERVICES

SANFORD H. CORNETT, CHIEF, BUDGET AND FINANCE BRANCH,
OFFICE OF ADMINISTRATIVE PLANNING AND SERVICES

HOUSE ALLOWANCE AND BUDGET REQUEST

Senator HOLLINGS. We will be delighted to hear from Mr. Staats on the GAO itself.

The budget estimate for fiscal year 1974 for the General Accounting Office amounts to $103,850,000 and I notice the House of Representatives has voted you the entire amount requested.

JUSTIFICATIONS

There is a rather interesting table on page D-1 of the justification which gives the comparative statement by office within the GAO of the 1973 revised estimate and the changes in the amounts requested and allowed by the House for fiscal year 1974. This table deals with dollars. I will insert this tabulation in the record as well as the tabulation on page D-2 of the justification which gives similar information by office of the number of people requested and approved by the House of Representatives.

[The justification follows:]

97-170 O 73 - 2

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PERSONNEL

Senator HOLLINGS. I notice you had a total of 5,050 positions for fiscal year 1973 that you have requested and the House allowed you 5,200 for fiscal year 1974.

That is 150 additional positions. Is that correct?

Mr. STAATS. That is correct. This comes out to an average employment increase of 129 in 1974 over our original 1973 level. Senator HOLLINGS. You proceed in the order you wish.

Mr. STAATS. Thank you, Mr. Chairman.

I will attempt to highlight and summarize my statement in the interest of meeting your time schedule.

SUMMARY OF BUDGET ESTIMATES

Our appropriation for this year is $96,235,000. Our 1974 request which has been passed by the House is $103,850,000. This request does not provide for costs resulting from the general pay increase which was effective on January 7, 1973.

NET INCREASE IN STAFFING

Funds appropriated for 1973 provided for a GAO staff of 4,951 man-years, including 21 man-years for consultants. In comparison, we are requesting 5,080 man-years for fiscal year 1974, including 30 man-years for consultants, an increase of 129 man-years over the number authorized for this year.

We have been able to hold down the number of man-years for the current year to 4,852, or 99 less than were authorized. In view of our growing workload, however, we will be adding to our staff through the remainder of this fiscal year so that as of June 30 we expect to have an actual employment of 5,050, only 30 below the average we are requesting for 1974.

As of today our total is 4,887. So we are moving toward that figure rather rapidly.

WORKLOAD

As outlined in our hearings last year, our workload in GAO has increased sharply because of the increasing number of requests we have had for assistance from the Congress as a whole, from committees of the Congress, and from individual Members, and new or expanded programs authorized in the last Congress which provide for a GAO audit.

In reviewing our budgetary requirements our division directors forecasted a need in fiscal year 1974 of a total of 5,872 man-years, or 792 more than we are requesting.

CONGRESSIONAL REQUESTS FOR ASSISTANCE

I decided, however, to limit our 1974 request to those increases necessary to meet workload or costs over which we have little or no no discretion. This includes a net staff increase of 129 man-years determined as follows:

Known or anticipated increases in congressional requests for assistance which we estimate at 130 man-years; reviews of new and expanded programs enacted in the last session of the Congress which

we estimate at 65 man-years; work which we are required to carry on by law, such as handling of bid protests and other required legal services, claims settlement and debt collection, and the Federal election activities assigned to us which are 24 man-years.

You will note that the total for these represent 219 man-years, but but we have been able to make reductions in other areas amounting to 90 man-years, leaving a net required increase of 129 years.

FUNDS FOR ADDITIONAL STAFFING

Our request for appropriations for 1974, then, will increase over the amount of appropriated for fiscal year 1973 because of costs incident to staff increases, which is $2,041,000; and the remainder, Mr. Chairman, is $5,574,000 all related to increased pay and other increased costs due to price increases.

That brings us to a total increase over this year's appropriation of $7,615,000.

DEVALUATION AND INTERNATIONAL OPERATIONS

We have not in this estimate taken into account the effect of the recent 10-percent devaluation of the dollar. The costs of our international operations includes three offices overseas and the travel to and from the United States will increase because of the devaluation we estimate by about $100,000 in 1974.

OBJECTIVES AND SAVINGS

Mr. Chairman, it is always difficult to translate the full effect of GAO activities in terms of improvement of the operations and effectiveness of the government. We have talked about that in previous appearances before this committee. Many actions taken in response to our recommendations cannot be readily measured in terms of dollar savings. We do make estimates of savings that are directly attributable to GÃO recommendations when this can be done readily.

I might add when we can be certain that it flows directly from our recommendations. However, we do not believe that dollar savings by themselves is a very good test of our effectiveness. Rather, our objective is to concern ourselves with opportunities for improving the economy and the effectiveness of government programs irrespective of the amount of savings which we might claim from our work at the end of the year.

Nevertheless, we feel it useful to maintain a record of readily translatable dollar savings resulting from actions taken by Federal agencies through the adoption of GAO recommendations. For fiscal year 1972, these amounted to $292.3 million in additional revenues or savings. These are shown in some detail in our justification of estimates and are summarized in attachment 1.

More frequently our work contributes to significant improvements which, for various reasons, cannot be included in our tangible savings report.

Senator HOLLINGS. I note that the $292.3 million consists of $29.3 million in refunds and collections and $263 million in other savings. How much of this $292.3 million is attributable to GAO-initiated reviews?

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