Savings Bonds Division:

(a) Cost increases of Federal Telecommunications System

(b) Increased reimbursements to U. S. Postal Service

Total

The total savings and nonrecurring costs consists of the following:

(a) Management improvement savings (b) Nonrecurring costs for equipment rental

(c) Nonrecurring costs for rental of space, Washington

Total

Savings Bonds Division:

1. Issuance, servicing and retirement of savings type securities. This activtiy consists of (a) prescribing the specifications for and ordering, storing and distributing securities; (b) establishing records of registration of issued securities; (c) maintaining accounting control over public debt financial transactions, public debt security transactions and accountability, and interest cost; (d) maintaining and servicing individual accounts of the owners of Series H bonds and determining and authorizing the semiannual interest payments due their owners; (e) adjudicating claims for the replacement or payment of lost, stolen or destroyed securities; (f) handling reissues and other transactions incident to servicing outstanding securities; (g) auditing and recording the serial numbers of all retired securities, maintaining custody of retired securities until destroyed and maintaining permanent custody of microfilm copies thereof; and (h) supervising the destruction of retired securities.

The 1974 estimate of sales of Series E savings bonds is 132, 000, 000 pieces, an increase of 2, 000, 000 above the estimated 1973 volume. No change is estimated in the volume of sales of H bonds in 1974 from the 550, 000 estimated for 1973. Retirements of savings type securities for the same period are estimated at 126, 700, 000 pieces, up 5, 800, 000 above the volume estimated for 1973. The net workload of issuing and retiring savings type securities is expected to increase about 3.2% above the 1973 level.

2.

Issuance, servicing, and retirement of other Treasury securities. This activity covers the same types of functions for all United States securities other than savings type securities except that there are, in addition, certain functions related to the processing of interest coupons which are not a part of the savings type securities activity. This activity is responsible also for processing all securities issued, serviced and retired in behalf of Government corporations for which the Treasury acts as agent and maintaining accounting control over agency security transactions and accountability.

unit production costs are expected to increase because of higher wage and material costs.

3.

Promotion of the sale of savings type securities. The major objective of the U. S. Savings Bonds Division is to promote the sale and retention of U. S. Savings Bonds. The Division operates with a small full time paid staff of approximately 500, depending upon a volunteer organization of several hundred thousand to carry out its mission. The extent of contributed, voluntary assistance is illustrated by the fact that the annual value of the contributed advertising alone is eight times the amount of the total of the annual appropriated funds for the entire Division.

A one-half percent bonus for savings in mid-1970
bringing the effective rate to 51/2% triggered a significant
turn-about in savings bond sales and redemptions. Sales
increased 6% in calendar 1970, and redemptions declined
4%. In 1971 and 1972 the competitive savings bonds rate,
combined with an unprecedentedly high over-all rate of
savings in the economy resulted in sales increases of
17% in calendar 1971 and 14% in 1972. Redemptions (including
accrued discount) fell by 17% in calendar 1971 and rose
slightly in 1972 by 2%. The total amount outstanding $57, 579
million on December 31, 1972, increased by $5, 737 million
($5.7 billion) in these two years.

Savings bonds account for nearly one-quarter of the privately
held portion of the public debt and provide a noninflationary form
of financing for the Department of the Treasury.