STATEMENT OF
JOHN A. KOSKINEN
DEPUTY DIRECTOR FOR MANAGEMENT
OFFICE OF MANAGEMENT AND BUDGET
BEFORE THE
HOUSE COMMITTEE ON GOVERNMENT REFORM AND OVERSIGHT
FEBRUARY 12, 1997
Mr. Chairman, I am pleased to appear
before the Committee this morning to discuss the
importance to the Government and the public of the Government
Performance and Results Act of
1993 (GPRA) and to provide an assessment of our progress to date in
meeting its major
requirements. GPRA was enacted three and a half years ago as the
result of a bipartisan effort in
the Congress, with the support of the Administration, to increase our
focus on the results from
government programs and activities. This Committee was one of the
leaders in the passage of the
Act and we look forward to continuing to work with you and the
Congress as we implement this
significant legislation.
At its simplest, GPRA can be reduced
to a single question: What are we getting for the money
we are spending? To make GPRA more directly relevant for the
thousands of Federal officials
who manage programs and activities across the government, GPRA expands
this one question
into three: What is your program or organization trying to achieve?
How will its effectiveness
be determined? How is it actually doing? One measure of GPRA's
success will be when any
Federal manager anywhere can respond knowledgeably to all three
questions.
But having answers to these
questions is of great interest to the public as well. As a
government, we face major challenges. This is a time of great fiscal
constraint. Tight budget
resources demand that every dollar count. During a period of much
public skepticism about the
government's ability to do things right, the government must not only
work better, but be shown
as working better, if we are to regain public confidence in this
institution. We must chart a course
that not only sustains our delivery of services to the public, but
improves on that delivery while
meeting the rightful expectations of its citizens to be treated
fairly, responsively, and with good
effect. GPRA, if successfully implemented, will support such a
result.
Let me now briefly summarize those
aspects of GPRA implementation that are our most
immediate focus.
Basic Requirements and
Timetable
Strategic plans
The basic foundation for what
agencies do under GPRA is the agency strategic plan. Agencies
are required to send their strategic plans to Congress and OMB by this
September 30th. When
developing its strategic plan, an agency is to consult with Congress
and solicit and consider the
views of those parties interested in or potentially affected by a
plan. OMB has encouraged
agencies to begin this consultation soon.
Our guidance to the agencies on
preparing and submitting strategic plans notes that the agency
letter transmitting the plan to Congress and OMB should describe the
consultation that was done,
as well as summarizing any views of those outside the Executive branch
that present a contrary
view to the basic direction of the plan as completed.
The strategic plan spans a multi-year
time frame, and is required to include a mission
statement, a set of general goals and objectives, and a description of
the linkage between these
general goals and objectives and the performance goals that will
appear in the annual performance
plan. The mission statement sets forth the basic purpose for what an
agency does
programmatically and operationally. The long-term general goals and
objectives define what the
agency intends to achieve over the time period of the plan, to further
its overall mission. The
linkage between long-term goals and annual goals is important because
the annual goals are
commonly used to measure progress in achieving the general goals and
objectives.
OMB issued guidance to the agencies
in September 1995 on the preparation and submission of
strategic plans. This guidance resulted from an OMB/agency
collaboration during the Spring and
Summer of 1995. In the Summer of 1996, OMB conducted a comprehensive
review of the
agency strategic planning efforts and the status of their plans. The
review's objective was to
gauge agency progress in preparing their strategic plans and to
identify any concerns with the
plans themselves or the process being followed. Agencies provided OMB
with certain key parts
of their plan for this review which were in a draft or developmental
state.
Generally, the agency plans reflected
a serious effort and allowed us to conclude that agencies
should be able to produce useful and informative strategic plans by
this Fall. The review also
revealed several challenges. Last summer, most agencies were only
beginning to link the general
goals and objectives of their plans with the annual performance goals
they would be including in
their annual performance plan. Further inter-agency coordination on
programs or activities that
are cross-cutting in nature was necessary and the senior leadership in
some agencies had yet to
become fully involved in the planning process.
Since then, OMB staff have continued
to interact with the agencies as these strategic plans
have evolved and we will undertake another systematic review of the
agency strategic plans this
spring.
Annual Performance Plans
Pursuant to the statute, the first of
the agency annual performance plans will be sent to OMB
this September. These plans will be for fiscal year 1999, and will be
submitted with the ageency's
budget request for that year. The annual performance plans will
contain the specific performance
goals that the agency intends to achieve in the fiscal year. The
statute provides that a subsequent
iteration of the annual performance plan is to be sent to Congress
concurrently with release of the
President's budget.
The agencies and OMB gained valuable
experience in preparing annual performance plans
through the pilot project phase of GPRA. The statute wisely provided
an opportunity for all 14
Cabinet Departments and an equal number of independent agencies to
experiment with the
implementation of the statute. Over 70 individual pilot projects were
established, ranging in size
from the entire Internal Revenue Service to small offices and programs
within a larger bureau.
The performance measurement pilot project phase of GPRA concluded in
FY 1996. OMB's May
1997 Report to Congress on GPRA will describe this pilot project phase
in greater detail.
In September 1996, OMB initiated a
special review of the performance goals that agencies
proposed to include in their annual performance plans for FY 1999.
This review is still ongoing.
The agencies are providing OMB with descriptions of their proposed
performance goals,
illustrating what will be measured and the nature and type of
measurement.
The timing and sequence of these two
reviews, one in the summer of 1996 and the other in the
fall, was by design. The Summer Review concentrated on strategic
plans, which are the starting
point for annual performance plans. A strategic plan is like a
compass pointing to what an agency
seeks to achieve over the long-term. Without such a compass, it is
difficult to judge whether the
annual performance goals are appropriate.
Our experience with the pilot
projects and with Summer Review underscored the importance
of having a review focused on the annual performance goals. Gaining
an early consensus on these
goals will not only help assure that they are appropriate and relevant
but will allow agencies to
measure current performance, creating a baseline from which to set
future performance levels or
targets.
In another joint collaboration with
the agencies, OMB is preparing guidance on the
preparation and submission of annual performance plans for FY 1999.
The drafting of this
guidance is largely complete and the guidance will be issued soon and
we expect agencies to
produce useful and informative annual performance plans for FY 1999.
Government-wide
performance plan
GPRA requires that a government-wide
performance plan be annually prepared and made part
of the President's budget. The government-wide performance plan is
based on the agency annual
performance plans. The first government-wide plan will be sent to
Congress in February 1998,
and cover FY 1999. We will soon begin an effort to design this
document, determining what
should be included and how it should be presented. In this regard, we
would welcome your views
on those features that you believe would make this document
informative and useful to the
Congress. Program Performance Reports
The agency's program performance
report is the annual concluding element of GPRA. These
reports are required within six months of the end of a fiscal year,
and compare actual performance
with the performance goal target levels in the annual performance
plan. Where a goal was not
met, the agency explains why and describes the actions being taken to
achieve the goal in the
future. The first program performance reports, for FY 1999, are to be
sent to the President and
Congress by March 31, 2000.
The performance measurement pilot
projects are being used as a test of the program
performance reports, and the ability of agencies to generate timely
and accurate actual
performance data. OMB is considering integrating the GPRA program
performance report with
each agency's audited financial statement and several other periodic
reports to create a single
agency accountability report. We expect that the OMB Report to
Congress in May will further
outline proposals for such a single report.
OMB's GPRA Effort
The OMB-led reviews I have previously
outlined are part of the Administration's overall effort
to ensure successful implementation of GPRA and indicate the great
importance we attach to this
effort. Two OMB-wide forums dedicated to performance and GPRA
preceded the
government-wide reviews begun last summer. These forums were used to
familiarize all OMB
staff with the statute and its requirements and to draw upon their
experience and suggestions for
how it might be successfully implemented. The magnitude of GPRA, its
encompassing scope, and
its integration with the budget dictate that every major
organizational component within OMB
have some role in its implementation. To advance the concept of OMB-
wide responsibility for
GPRA, OMB established a GPRA Implementation Group, whose members are
from every OMB
office and comprise nearly 10 percent of our total professional staff.
The Implementation Group
meets regularly to discuss and review GPRA implementation tasks and
policies.
In many ways, the best training is
having to do it yourself. OMB has been working on its own
strategic plan for nearly a year, an effort that has involved all
parts and levels of the organization.
Later this month, OMB will have a day-long "standdown" in which all
staff will focus on our
strategic plan and the goals we propose to establish for our
organization.
Valuable help for our government-wide
implementation effort is also coming from several
interagency councils which I chair. These are the President's
Management Council, whose
members are the agency Chief Operating Officers (generally the Deputy
Secretary); the Chief
Financial Officer's Council; and the President's Council on Integrity
and Efficiency, comprised of
the agency Inspectors General. Each of these councils has taken
leadership for one or more
aspects of GPRA implementation, and have developed and disseminated
useful techniques and
practices to assist the agencies. They are also helping us to develop
a unifying framework for
bringing together the various laws and initiatives that focus on
performance. These include
GPRA, the Government Management Reform Act, the Chief Financial
Officers Act, the Federal
Acquisition Simplification Act, the Federal Managers' Financial
Integrity Act, the Inspector
General Act, the Clinger-Cohen Act, as well as initiatives originating
from the National
Performance Review, such as development of customer service standards
and performance-based
organizations. There is consensus that this integration must be
done, and, to the extent
practicable, must be meshed into the processes supporting budget
preparation, decisions, and
execution.
To do this will be a formidable task.
But we have no real choice. If managed separately,
these various endeavors will lose the synergy and economy of effort
that would result from
their being fitted together. Failure to coordinate and integrate
these laws and initiatives can
undercut their effectiveness, create confusion, and introduce
frustration and ultimately disinterest
among all parties. Put starkly and simply, there are not enough
resources within the Executive
branch to even try carrying out these activities in a non-integrated
way.
Sorting through the complexity of
these varying performance initiatives has been difficult, but
we are making progress in defining a framework for this integration.
Expectations
As noted earlier, we expect agencies
to provide useful and informative strategic and annual
performance plans within the timeline specified by the Act. However,
preparing a good GPRA
plan is not an easy task. Indeed, a plan easily prepared is likely to
be a superficial plan.
Therefore, no one should expect the first plans to be perfect. We
should view these first plans as
the beginning of a process of improvement and refinement that will
evolve over several years.
Measures will be modified, better and more appropriate goals will be
defined, performance data
will increase in both volume and quality.
Even as performance measures become
more refined, we should always bear in mind that using
performance measures in the budgeting process will never be an exact
science, or even a science
at all. Often, an under-performing program will benefit from
additional resources, not fewer.
Comparing results across program lines will always require political
judgments about the relative
priorities, for example, of programs for highways and education. And
we should not lose sight of
the fact that performance information will often be used to adjust the
way programs are managed
rather than to change the resources provided. Accurate, timely
performance information is
important in all these situations and this is why the Administration
is committed to the successful
implementation of GPRA.
As I have said on other occasions, if
we are successful, over time, GPRA should disappear.
Some may think such a declaration flies in the face of the enthusiasm
of this Administration for
GPRA. However, if GPRA works as envisioned, government managers will
absorb it into
day-to-day agency administration and program management. For this to
happen, we must guard
against creating a separate GPRA bureaucracy in each agency that
provides the documents and
information required by the statute in an effort that is divorced from
this day-to-day management
of the agency. That's why I suggest that the true measure of the
success of GPRA will be the
extent to which the concepts of management and good business practices
set out in this law
become the accepted way that the government works without reference to
any particular statutory
framework or requirements.
Conclusion
This concludes my statement, Mr.
Chairman. I'd be pleased to take any questions you may
have.