The variety and complexity of the work involved in functioning as staff to the President make it difficult to encompass all the workload of the Office of Management and Budget within a brief statement. However, the continuing work responsibilities of the Office set forth below should provide some understanding of the most significant workload toward which the 1973 budget request is directed.

PROGRAM AND BUDGET REVIEW

The rapid growth of Government programs is illustrated not only 1. by the increase in net budget outlays, but also by the increase in gross payments to the public over the past 10 years:

2.

Major changes in the composition of Federal programs have resulted in the most extensive governmental changes in history. The dynamics of program developments require not only that new programs be analyzed in depth, but that efforts be continuously directed toward evaluating existing programs so that activities which are of low priority, uneconomic, and outmoded can be identified and proposed for elimination or reform.

The Government's program and budget review is directed toward several objectives. Consideration must be given to fitting the programs and the allocation of resources within the framework of a sound economic and fiscal policy to meet the needs of the Nation. Every effort must be made to hold spending to the minimum necessary to accomplish programs effectively, and to see that the Government gets a dollar's worth of results for each dollar that is spent. Surveillance of efficiency must be accompanied by attention to effectiveness in the larger sense. Thus, agencies are not encouraged to merely do efficiently those things which are useless, but to put their efforts into doing that which is most useful to the Nation and doing it efficiently.

The Budget Review Division, the Evaluation Division, and the six program divisions have had their workload significantly increased by various recent actions and proposals. Since these involve fundamental changes in the structure of the Federal Government and the way it operates, it can be expected that they will have significant effects on workload throughout fiscal year 1973, and in the future. Among those actions and proposals are:

a.

Follow-through on governmental spending aspects of the Economic Stabilization Program. The President, as a part of his August 15, 1971, actions to stabilize the economy, directed the Office of Management and Budget to take fresh action to restrain Government employment and outlays. Even though the Office's normal activities are directed toward a similar objective, the President's specific targets for the overall reduction have required extra staff effort in the current fiscal year. While the situation for 1973 is not predictable, it is evident that a larger quantity of staff time must hereafter be devoted to the coordination of Federal spending levels throughout each year with the requirements of overall economic stabilization.

Implementation of budget and fiscal aspects of the Legislative Reorganization Act of 1970. Title II of that Act gives the Office of Management and Budget several new responsibilities. Some relate to data processing and budget classifications. Others call for supplemental budget information including a summation of budget status by June 1 of each year. The former of these requirements places the responsibility upon the Office of Management and Budget to coordinate with the Treasury and the General Accounting Office, and there is also a need to work closely with the respective agencies whose programs must be classified and reported. Since this work is mandated by law, its elimination or deferrment is not feasible.

C. Revenue sharing proposals of the President. The President's seven
proposals for revenue sharing create a special transitional problem in the area
of program and budget review. The transfer of balances of certain prior grant-
in-aid appropriations into the new appropriations for special revenue sharing
will call for special surveillance and monitoring. In the preparation of the next
budget, extra care must be exercised to provide an understandable comparison
of figures between those fiscal years on the old basis and those on the new
basis. Judging from experience, special compilations of data on revenue
sharing will undoubtedly be requested by various congressional committees,
and more staff time will be required to make such compilations promptly.

d. Executive reorganization proposals of the President. During this
session of Congress the President has proposed the most far-reaching re-
organization ever undertaken for the executive branch, including the creation
of four new executive departments and the abolition of several old
departments. These proposals are pending before the Congress. The
implementation of these proposals, if adopted by Congress, will involve not only
the management divisions of the Office, but also those divisions which deal
primarily with program and budget matters. New appropriation structures must
be developed to match the new organizations. Budget analyses must be
restructured to fit the new pattern of activities and assistance must be given
for the transfer of funds, personnel, and property.

е. Review and coordination of credit programs. Some credit
programs which are outside the budget guarantees and insured loans, and
loans by federally-sponsored, privately-owned enterprises escape regular
review by either the executive or the legislative branch. The nonevaluation of
these extra-budgetary programs permits them to function in a manner which
is inconsistent with the budget. Their effects on fiscal policy have not been
examined thoroughly and rigorously. Their effects on overall debt management
are not coordinated with the overall public debt policy. The amounts involved
are not small. They are projected at a level of $33 billion or more in fiscal year
1973. For these reasons the President has sought to bring such programs under
more systematic review and coordination. This will involve both budget
preparation and budget execution activities.

f. Budget reform. The budget process needs continual attention to
keep it manageable and serviceable. However, at this particular time, there is
an acute need for solving some of the problems associated with delays in
authorizations and appropriations, disputes over the definition and nature of
"reserves," and complications of budget scorekeeping. Careful study of the
matters, and close liaison with representatives of the appropriations
committees are projected for fiscal year 1973.

GENERAL PROGRAM AND MANAGEMENT EVALUATION

The programs and management procedures of the Federal agencies are under continuous review by the Office's program and management divisions. Some programs and management procedures, however, involve several agencies, and therefore require a broader evaluation activity.

The major purpose of the general program and management evaluation function is to improve the evaluation of the costs and effects of existing and potential Federal activities that crosscut agency responsibilities. Specific activities include developing improved evaluation methodologies, providing analytic services to other divisions of the Office, performing special evaluation projects, and providing a focal point for the analysis and review of Federal issues conducted elsewhere.

Major 1973 work items in this function are detailed below:

2.

Special studies of Federal programs. Many Federal programs cut across agency lines so that related problems cannot be transmitted to any single agency as an issue to be evaluated internally. Other questions requiring analysis are of a nature that make agency objectivity difficult to assure. Still others are of a general nature, and cannot be appropriately assigned to any agency. Accordingly, the staff of the Evaluation Division selects certain of these problem topics for special analyses.

3. Spring Budget Review. The Spring Budget Review has increasingly become a programmatic review of the Federal budget. Simultaneously, the major program issue cycle has been adjusted to permit issue analyses to be presented at the Spring Reviews. Consequently, the Division assumes major responsibilities for preparation of and participation in Spring Reviews.

2. Space programs. The civilian space program is currently in transition from the Apollo era of manned lunar landings to the post-Apollo program. With the initial approval of the development of the manned space shuttle, continued analysis will be required on the actual costs of completion, including facility requirements. In addition, selected areas of the National Aeronautics and Space Administration's ongoing activities are receiving increased emphasis. These activities such as space applications and aeronautical technology will require further analyses in terms of their transfer to government and private users.

3. Atomic energy. The growing concern about the Nation's energy needs reflects itself in the requirement for intensified analysis and review of the Atomic Energy Commission's energy related programs. The liquid metal fast breeder reactor program is being accelerated in 1973 in order to demonstrate technical feasibility by 1980, and increased emphasis is being placed on the controlled thermonuclear fusion program to meet long-term needs for clean energy. These activities as well as the ongoing programs of the Atomic Energy Commission, will require continued staff review and examination.

4. Business and economic development. Increasing emphasis is being placed on direct financial assistance to small business, including expansion of financial and management assistance to minority businessmen. This will require detailed program analyses of the activities of the Small Business Administation and the Department of Commerce. Research and activities of the National Oceanic and Atmospheric Administration and the National Bureau of Standards will require continued monitoring and evaluation. Selected program areas such as the Federal Government's role in commercial fishing and mapping and charting requirements will be the subject of further staff analysis.

5. General science. The Division is responsible for review and analysis of the programs of the National Science Foundation and of the activities of the Office of Science and Technology. These assignments extend the Division's responsibilities into analyzing the Federal Government's overall support of research and development and its relationship to national needs. The

ANALYSIS OF NATURAL RESOURCES AGRICULTURAL AND ENVIRONMENTAL PROGRAMS

The effective development and wise use of the Nation's water and other natural resources, as well as the solution of problems associated with the American farmer and rural areas, involve many important legislative and budgetary issues. Among the influences affecting this general area of the budget include the growing concern for the quality of our environment, comprehensive approach to decisions on our river basins, expansion of outdoor recreation opportunities, adequate supplies of clean energy, provision of better services to rural people and communities, and control of the Nation's agricultural capacity.

The following are some of the workload items which confront the Office -particularly the Natural Resources Programs Division:

2. Water resources project reports. Under Executive Order 9384, the Office reviews reports on projects proposed by the Corps of Engineers and the Bureau of Reclamation before they are transmitted to the Congress. Executive Order 10654 requires a similar review of the Department of Agriculture's reports on watershed projects.

Workload is affected not only by the number of project reports but also by the increasing complexity of water projects serving many purposes, conflicting uses of water, and growing interest in environmental preservation.