Report: Agencies goals, budgets not yet linked

Federal agencies' first attempt to generate performance plans under the Results Act was largely a trial by fire in which most agencies failed to link program funding to performance goals, according to a new report.

In the report, "Performance Budgeting: Initial Experiences Under the Results Act in Linking Plans with Budgets" (AIMD/GGD-99-67), General Accounting Office auditors reviewed 35 agencies' fiscal 1999 performance plans to determine how well agencies' spending decisions were tied to their performance goals, as required under the 1993 Government Performance and Results Act.

Although most agencies made an attempt to link their programs to their proposed budgets, only 14 agencies' plans (40 percent) reviewed did so successfully, the report said. The first-year attempt was genuine, "but much remains to be done if performance information is to be more useful for budget decision-making," GAO concluded.

Agencies approached the task of tying budgets to goals in a variety of ways, GAO found. For example, the Bureau of Land Management plan defined five different types of goals in its plan, while the Agency for International Development's plan used only two goals.

Quantifying just the top two layers of goals in agency plans, GAO found that agencies listed anywhere from one to 47 strategic goals and five to 122 strategic objectives.

Agencies' 1999 performance plans showed a tendency to lump several activities together and relate them to several goals. Only eight plans used a more direct approach, linking a single program activity to multiple performance goals, the report said. For example, the Health Resources and Services Administration's AIDS emergency relief grants were linked to its goal of increasing the number of clients served by Title I grants as well as three other performance goals.

The 14 agencies whose performance plans clarified how resources are related to results had two things in common. First, the agencies used simple links between activities and goals. Second, they integrated budget justifications with performance plans. Other agencies kept their budget requests and performance plans separated in different documents and retained the budget structure they had used in previous budget submissions.

GAO singled out the Internal Revenue Service for its integration of budget information and performance goals. The IRS's performance plan "shows how information traditionally contained in a budget justification, such as descriptions of accounts and their funding, was combined with performance information," GAO said.

GAO recommended that the Office of Management and Budget develop guidance for agencies' fiscal year 2001 performance plans, to eliminate confusion on how to best relate budget resources and results. "Ultimately, performance-based management should become an integral part of an agency's culture," the report said.

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