Washington, DC ? Senate Governmental Affairs Committee Chairman Fred Thompson (R-TN) today sent a letter to Office of Management and Budget (OMB) Director Jacob Lew, expressing disappointment with OMB?s lack of leadership in complying with the Results Act.
Senator Thompson voiced particular frustration with OMB?s own performance report for fiscal year (FY) 1999. The report, distributed March 31, at the same time agency reports were due for the first time under the Government Performance and Results Act (Results Act), was supposed to outline the success OMB had in meeting goals.
While pointing out several key deficiencies in the report, Senator Thompson wrote, “The purpose of analyzing the content of OMB?s FY ?99 report is not to ensure compliance with the technical requirements of the Results Act. I am more interested in making an evaluation of your performance in addressing the major management challenges that face our government. Unfortunately, OMB?s FY 1999 Performance Report gives me no basis on which to make such an evaluation.”
Senator Thompson also wrote in his letter to OMB Director Lew, “OMB has a unique responsibility of leadership in implementing and sustaining the move toward greater use of performance information throughout the federal government. If you allow OMB to be held publicly accountable for progress in addressing major management challenges, agencies will be more likely to take such accountability on themselves. Until that time, your ability to lead in this area will be hampered substantially.”
The Results Act, passed in 1993, is designed to provide policy-makers and the public with systematic, reliable information about where federal programs and activities are going, how they will get there, and how we will know when they have arrived. Agencies have had mixed results complying with the reporting requirements of the Act. The Act requires performance reports to be filed by March 31st of each year, beginning this year.
April 12, 2000
The Honorable Jacob J. Lew
Office of Management and Budget
Executive Office Building
Washington, DC 20503
Dear Director Lew:
I am in receipt of a letter from Mr. Charles Kieffer, Acting Associate Director for Legislative Affairs, who wrote that the Fiscal Year 1999 Performance Report for the Office of Management and Budget contained an error. The OMB report maintained that 18 of 24 agencies received clean opinions on their financial statements. In addition, the report stated that “Eighteen of the 24 agencies are expected to receive clean opinions on their FY1999 statements.” Both of those statements are untrue.
I appreciate OMB?s expression of regret for the error. Mr. Kieffer stated in his letter that, at the time the report was printed, the statement that 18 of 24 agencies were expected to receive clean opinions on their financial statements was true. However, the Committee on Governmental Affairs determined as early as February 28, 2000, based on information provided by your office, that meeting OMB?s revised goal of 18 clean opinions would be impossible. As OMB is the office responsible for implementation of the Chief Financial Officers Act, I would be surprised if OMB did not learn of that fact earlier than February 28th.
More important than the fact that your office says data was published before it was complete is the overall quality of the FY1999 performance report. The Results Act seeks to instill “goal-setting, performance measurement, and results reporting . . . to address the needs of Congress and of federal program managers.” OMB?s FY1999 Performance Report does not achieve these objectives.
To illustrate my point, I want to draw your attention to four goals under OMB?s second strategic objective, to “provide management leadership to ensure the faithful execution of the enacted budget, programs, regulations, and policies.” Those goals, which OMB claims to have achieved, include:
Continuously work with agencies to improve management practices;
Promote the Federal procurement workforce?s use of good business judgment within an adaptable system of flexible rules and procedures;
Work with all agencies to assure that their financial systems comply with the Federal Financial Management Improvement Act of 1996; and
Review significant agency regulations and their accompanying analyses.
These goals do not meet the criteria set in law and in OMB guidance for performance goals. In OMB?s guidance to agencies for implementation of the Results Act, a performance goal is defined as “a target level of performance expressed as a tangible, measurable objective, against which actual performance can be compared, including a goal expressed as a quantitative standard, value, or rate.” None of the aforementioned goals meet this standard. Consequently, the Committee has no basis with which to compare targeted performance against actual performance.
OMB?s performance plan also falls short in providing data on performance indicators for each of the aforementioned performance goals. The Committee would look for performance indicators listed in the FY1999 Performance Plan to assess the performance of OMB in providing management leadership. The law requires that each program performance report include the performance indicators established in the agency performance plan.
One such indicator, specifically enumerated in the FY1999 Performance Plan, is the President?s Performance Management Objectives (PMO). Unfortunately, your office gave scant analysis of whether the President?s PMO?s were met and the report lists very few achievements in relation to the 22 PMO?s listed in the President?s FY1999 budget. Additionally, there was virtually no mention of the specific commitments made for 1999 with respect to the PMO?s.
The purpose of analyzing the content of OMB?s FY1999 performance report is not to ensure compliance with the technical requirements of the Results Act. I am more interested in making an evaluation of your performance in addressing the major management challenges that face our government. Unfortunately, OMB?s FY1999 Performance Report gives me no basis on which to make such an evaluation.
The premise of the Results Act is that we can manage improvement by setting goals and measures for agencies and employees. To make this effort successful, it is essential that we commit ourselves to tangible steps so that we can objectively measure performance. The Committee?s charge is to ensure that we have effective management practices throughout government.
I have consistently urged agency heads to establish specific and measurable goals in their annual Results Act performance plans to address major management challenges. Such goals must lead us to solutions for such problems and agency heads must accept accountability for following through on the commitments they make. Without such measures or goals, it is difficult, if not impossible, to assess progress in addressing major management problems and to hold people accountable.
OMB has a unique responsibility of leadership in implementing and sustaining the move toward greater use of performance information throughout the federal government. In light of this responsibility, I urge you to publically release the goals and measures associated with the President?s PMO?s for FY2001 and in the future. If you allow OMB to be held publicly accountable for progress in addressing major management challenges, agencies will be more likely to take such accountability on themselves. Until that time, your ability to lead in this area will be hampered substantially.
Thank you for your kind attention to my thoughts on this issue. If you have any questions, please don?t hesitate to contact me.