TESTIMONY OF JOSHUA B. BOLTEN
OFFICE OF MANAGEMENT AND BUDGET
SUBCOMMITTEE ON TRANSPORTATON, TREASURY, THE JUDICIARY AND
HOUSING AND URBAN DEVELOPMENT
Mr. Chairman, Senator Murray, Members of the Subcommittee, I am pleased
to be here this morning to discuss the Presidents FY 2006 Budget
request for the Office of Management and Budget (OMB).
War on Terror, Protecting the Homeland and
Strengthening the Economy
I would like to begin with a brief review of the Presidents overall
FY 2006 Budget. The 2006 Budget funds efforts to defend the homeland from
attack. We are transforming our military and supporting our troops as they
fight and win the Global War on Terror. We are helping to spread freedom
throughout the world. We are promoting high standards in our schools. The
Presidents policies in this Budget, especially tax relief, have helped
create millions of new jobs, a rebound in business investment, and record
homeownership rates. In order to keep our economy strong, and achieve the
Presidents goal of cutting the deficit in half by 2009, we need to
continue the Presidents pro-growth policies and exercise even greater
During the first term the President committed to spend what was needed to
win the War on Terror and protect the homeland -- and he committed to enforce
spending restraint elsewhere. Because of this focus, deficits are below
what they otherwise would have been. With continuation of the Presidents
pro-growth economic policies and responsible spending restraint, we will
remain on track to cut the deficit in half by 2009, to a level that is well
below the 40-year historical average deficit of 2.3 percent of GDP.
The Administration proposes to tighten spending further this year by limiting
the growth in overall discretionary spending, even after significant increases
in defense and homeland security, to 2.1 percentless than the projected
rate of inflation. In other words, under the Presidents 2006 Budget,
overall discretionary spending will see a reduction in real terms. In non-security
discretionary accounts, the President proposes to cut spending by nearly
1 percentthe tightest such restraint proposed since the Reagan Administration.
The Budget also proposes more than 150 reductions and eliminations in non-defense
discretionary programs, saving about $20 billion in 2006, and an additional
set of reforms in mandatory programs, saving about $137 billion over the
next 10 years.
To ensure the Federal Government spends taxpayer dollars most effectively,
the Administration continues to implement the Presidents Management
Agenda (PMA). The PMA helps individual agencies and programs focus on and
produce results, and promotes this goal through several key components:
strategic management of human capital; competitive sourcing; improved financial
performance and reporting standards; electronic government (e-gov) initiatives;
and integration of budget policy with performance measures.
OMB has successfully designed and implemented the Program Assessment Rating
Tool, or PART, to help agencies measure the success of their programs, focus
efforts to improve program performance, and set budgetary policy accordingly.
Consistent with the Presidents overall FY 2006 budget proposal, the
Office of Management and Budget has submitted a disciplined request. OMBs
total budget request amounts to $75.1 million the same as was appropriated
for the agency in the 2005 Budget process.
To achieve this spending restraint, OMB is pursuing cost savings wherever
possible. As in the past, OMB is achieving cost savings largely through
reductions in staffing. Last year, OMB was appropriated $1.6 million less
than the Presidents budgetary request. In addition, OMB like
other agencies absorbed a pay raise of 3.7 percent. To accommodate
lower funding levels, we have reduced OMB staff from 527 positions in fiscal
year 2001, to 510 positions in 2004, to the 490 positions anticipated for
2005 and 2006.
With these lower levels of resources and staffing, we believe OMB can continue
to deliver high-quality performance and fulfill our many important core
responsibilities. Our best known of these responsibilities is the preparation
of the Presidents annual Budget. In addition, our responsibilities
include oversight of budgetary matters, management issues, the Administrations
legislative proposals, regulatory reforms, procurement policies and other
important subjects. We assure that all such proposals are consistent with
relevant statutes and Presidential objectives. In meeting these responsibilities,
OMB is prepared to work within the constraints of a tight budgetary environment.
I look forward to working with the Congress to develop a final budget that
is consistent with our goals of spending discipline and focusing on priorities.