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Testimony of OMB Director Robert J. Portman
OMB’s FY 2008 Budget
Subcommittee on Financial Services
Committee on Appropriations
United States Senate
April 11, 2007
Chairman Durbin, Ranking Member Brownback, and distinguished members of the Subcommittee, thank you for having me here today regarding the President’s FY 2008 Budget request for the Office of Management and Budget. And thanks to Chairman Durbin and Mr. Brownback for meeting with me personally to review issues of interest to the subcommittee.
OMB has submitted a disciplined FY 2008 request. When rent and other costs are included, our total budget request amounts to $78.8 million – a 2.7% increase compared to FY 2007.
As the subcommittee is aware, OMB has been operating under tight budgets with an average annual increase of 1.8% per year since 2001. Our budget is nearly entirely comprised of salaries and expenses and our only significant means to achieve savings is through reductions in staffing. To accommodate our funding levels, we have reduced OMB staff from 527 positions in fiscal year 2001, to 510 positions in 2004, to 489 positions in 2007.
The Budget we have proposed for OMB will allow us to maintain our high caliber workforce of 489 employees, over 90 percent of whom are career civil servants, not appointees. We believe OMB can continue to deliver high-quality performance and fulfill our many important core responsibilities at these staff levels.
The best known of OMB’s responsibilities is the preparation of the President’s annual Budget, but we also have responsibility for oversight of the other agencies regarding budgetary matters, management issues, the Administration’s legislative proposals, regulatory reforms, procurement policies and other important matters. I believe our dedicated staff are performing their responsibilities in an outstanding manner within the constraints of a tight budget.
I would like to briefly draw your attention to our management responsibilities. We are focused on making the government more effective through five initiatives: (1) strategic management of human capital, (2) competitive sourcing, (3) improved financial performance, (4) expanded electronic government (e-gov), and (5) budget and performance integration.
With regard to this final initiative, to ensure greater government accountability, last year we launched a new website: ExpectMore.gov. This site provides information on programs that have been assessed for effectiveness using the Program Assessment Rating Tool, commonly referred to as the PART. With this website, Congress and the public now have an unprecedented view into which federal programs work, which do not, and the steps being taken to improve them. It’s part of an ongoing effort to provide greater transparency, hold ourselves accountable – and demand results.
With the new and improved version of this website launched with the 2008 Budget a couple of months ago, we now have program-level information about the performance of nearly 1,000 Federal programs representing about 96 percent of government and $2.5 trillion of federal spending. It’s a great resource: I urge Members and staff to check out ExpectMore.gov.
Unfortunately in recent years, Congress has included provisions in appropriations bills that slow our ability to make continued progress on the President’s Management Agenda, particularly in the area of the competitive sourcing and E-government.
Next week we plan to submit a report that updates you on how Competitive Sourcing is working. Here are some highlights in the report:
First, new efficiencies and performance improvements that have resulted from competitive sourcing are expected to produce more than $6 billion in savings for taxpayers over the next 5-10 years.
Second, we have only competed activities considered “commercial” or not inherently governmental, and we have competed only about 3% of all government activities.
Finally, federal employees have fared well in the competitions to date, receiving more than 83 percent of the work competed between 2003 and 2006.
I would also like to take a moment to comment on the President’s entire FY 2008 Budget. Our proposal shows how working together we can reduce the deficit every year and balance the budget by 2012, while keeping taxes low and meeting our nation’s priorities. It builds on the progress we’ve made over the past two years, which has led to a $165 billion reduction in the deficit.
One part of the 2008 Budget that is particularly relevant for this subcommittee and its jurisdiction are our new initiatives to address the tax gap through enhanced compliance and tax law changes. I am pleased to address this further in response to questions.
A balanced budget by 2012 will be a major accomplishment, but will be short-lived without addressing our long-term budgetary challenge: the unsustainable growth in entitlement programs. As appropriators you are well aware that this mandatory spending is overwhelming the rest of the Budget. In the space of four decades, mandatory spending has grown from about 25 percent of our budget to over half of our budget.
Mr. Chairman, thank you for having me before this important subcommittee. I believe OMB is staffed with some of the highest quality and most dedicated professionals in the federal government. As noted, we are recommending a disciplined budget for OMB that still provides the necessary resources to serve the President and meet our duties to the Congress and the American people. I look forward to working with the members of this Subcommittee as we move forward with the appropriations bill.
I thank the Committee for its time, and I look forward to your questions.