U.S. DEPARTMENT OF COMMERCE STATEMENT OF IRVING P. MARGULIES DEPUTY GENERAL COUNSEL BEFORE THE COMMITTEE ON POST OFFICE AND CIVIL SERVICE SUBCOMMITTEE ON INVESTIGATIONS U.S. HOUSE OF REPRESENTATIVES ON THE ESTABLISHMENT AND OPERATION OF THE PRESIDENT'S PRIVATE SECTOR SURVEY ON COST CONTROL IN THE FEDERAL GOVERNMENT September 15, 1982 Mr. Chairman and members of the Committee: I am pleased to appear before you to testify on matters pertaining to the President's Private Sector Survey on Cost Control. My testimony will describe the establishment and operation of the Survey. On February 18, 1982 President Reagan announced intention to establish a Private Sector Survey on Cost his Control as a key item in the Administration's program to curb runaway government spending. The President assembled a group of outstanding experts from the private sector who could report directly to him; and he made it clear that, he expected them to "roll up their sleeves and search out waste and inefficiency wherever it is to be found in the federal establishment." The President stated that special emphasis would be placed on eliminating overlap, red tape and duplication, identifying non-essential administrative activities, and increasing management e. ectiveness. On June 30, 1982 President Reagan issued Executive Order 12369, President's Private Sector Survey on Cost Control in the Federal Government. This Executive Order established the Executive Committee of the Survey and charged it with the following functions: (a) To conduct a private sector survey on cost control in the Federal Government and advise the President and the Secretary of Commerce, and other Executive agency heads with respect to improving management and reducing costs; (b) To carry out in-depth reviews of the operations of the Executive agencies and provide an objective outsiders view on improving management and reducing costs; and finally (c) To consider providing recommendations in these important areas of activity: (1) Opportunities for increased efficiency and reduced costs in the Federal Government that can be realized by Executive action or legislation; (2) Areas where managerial accountability can be enhanced and administrative control can be improved; (3) Opportunities for managerial improvements over both the short and long term; (4) Specific areas where further study can be justified by potential savings; and (5) Information and data relating to governmental expenditures, indebtedness, and personnel management. Section 3 of Executive Order 12369 assigns administration of the Committee to the Secretary of Commerce and directs that the Committee be "funded, staffed, and equipped, to the extent practicable and permitted by law, by the private sector without cost to the Federal Government". President Reagan in Section 3 (e) of Executive Order 12369 stated that he expected that the Secretary of Commerce would accomplish this by engaging in a joint project with a nonprofit organization pursuant to 15 U.S.C. $1525. Further, Executive Order 12369 charged the heads of all Federal agencies to cooperate in carrying out the functions of the Committee. Pursuant to the Executive Order and the requirements of the Federal Advisory Committee Act the Secretary of Commerce, on July 7, 1982, signed the charter of the Executive Committee. On July 13, 1982 copies of the charter were forwarded to the House Committees on Energy and Commerce, and on Government Operations, and the Senate Committees on Commerce, Science and Transportation and on Governmental Affairs. Copies were also sent to the General Services Administration and the Library of Congress. With your permission, Mr. Chairman I would like to submit a copy of the charter for the record. On July 7, 1982, under the authority of 15 U.S.C. $1525, the Secretary also signed an agreement with the Foundation for the President's Private Sector Survey on Cost Control, Inc., a private nonprofit corporation incorporated in the District of Columbia. With your permission, Mr. Chairman, I would like to submit a copy of this agreement for the record. This agreement sets out the responsibilities of the Secretary of Commerce and the Foundation to assist the Executive Committee in carrying out its responsibilities. Included as Exhibit B to the Agreement are specific controls to be established by the Foundation to prevent the unauthorized disclosure of government information. Exhibit A to the Agreement sets out a statement relating to the disclosure of information to unauthorized persons to be signed by all persons performing services for the Foundation. Each Executive agency is being examined by a Task Force headed by two members of the Executive Committee. In accordance with the agreement between the Secretary and the Foundation, the staff of each Task Force is composed of employees or agents of the Foundation. It is the responsibility of each agency to decide what information should be provided to the Survey and to designate any special handling requirements. Members of the Executive Committee are special government employees and as such are subject to the Conflict of Interest laws set forth in 18 U.S.c. $$202-209. Each agency was responsible for determining whether the assignment of particular Executive Committee members to examine that agency was consistent with applicable conflict of interest laws. The only Federal employee assigned full time to the Survey is Janet Colson who, under the agreement, is designated as liaison between the Foundation and the agencies to be examined. In addition, the Department has designated employees to provide necessary legal and administrative support to the Executive Committee. I would like to emphasize that the agreement provides that the Foundation, at no cost to the Federal Government, will provide such support as may be requested by the Chairman of the Committee to carry out its functions set out in Sec. 2 |