Poor performance leads to budget cuts at some agencies

The president's 2004 budget proposal cuts funding for some federal programs with poor performance records, continuing a practice begun during the fiscal 2003 budget cycle.

With budget deficits growing and the United States engaged in an expensive war on terrorism, President Bush recognizes that "we need to be smarter about how we spend our money," said Office of Management and Budget Director Mitch Daniels at a press conference Monday.

OMB reviewed a sample of 234 federal programs and rated them as "effective," "moderately effective," "adequate," "results not demonstrated" or "ineffective," based on whether they met performance goals established last year. By OMB's analysis, 5 percent of the 234 programs rated were "ineffective." For another 50 percent, agencies couldn't demonstrate results. Thirty percent of programs were rated as either "effective" or "moderately effective" and 14 percent were deemed "adequate."

The Bush administration used similar performance analyses to make funding decisions for more than 100 federal programs in its fiscal 2003 budget proposal. That budget proposal marked the first time an administration has formally linked federal spending to program performance.

But according to Carl DeMaio, president of the Performance Institute, an Arlington, Va.-based think tank, the fiscal 2004 budget proposal puts teeth behind the initiative to link agencies' budgets with performance data.

"Taxpayers deserve to know what results they are receiving for their tax dollars," DeMaio said in a statement. "This is the first budget that responds to that fundamental need with an objective, standardized and evidence-based assessment tool applied to a significant portion of federal programs."

DeMaio praised the budget proposal as a "truly historic" step that holds federal agencies more accountable for their performance than ever before. On average, the president's 2004 budget proposal rewards programs deemed "effective" with a 6 percent funding increase, and holds those programs "not showing results" to less than a 1 percent increase, according to DeMaio.

For instance, the Education and Health and Human Services departments both received "ineffective" ratings for programs they administer, prompting the administration to slash funds for those particular programs in the proposed budget, according to the budget document.

Bush's proposed funding for Education's Safe and Drug Free Schools State Grants was $422 million, an 11 percent reduction from fiscal 2003. OMB faulted the program for stretching its resources too thin to support quality drug prevention projects and using inappropriate measures to track progress on meeting its performance goals.

Health and Human Services' Health Professions competitive grants program would receive $82 million under the 2004 budget proposal, a 14 percent decrease from fiscal 2003 funding levels and a nearly 80 percent decrease since fiscal 2002. The program, which provides grants to educate health professionals, has failed at its attempts to encourage health professionals to serve in poor or rural areas, leading to an "ineffective" rating, Daniels said.

In contrast, the National Health Services Corps, another HHS program, has been more successful at moving health care providers into underserved areas, leading President Bush to channel more money its way, Daniels explained. The service corps received a "moderately effective" rating and a 12 percent budget boost.

The performance reviews grow out of a Bush administration initiative to link performance with budgets that was first announced in the fiscal 2002 budget. Making results a condition for funding-known as "performance budgeting"-is one of the administration's five governmentwide management priorities and was a chief goal of the 1993 Government Performance and Results Act.

The process generally seeks to reward high-performing programs with bigger budgets, while shifting resources away from low-performing or duplicative programs.

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
Close [ x ] More from GovExec

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Sponsored by Brocade

    Best of 2016 Federal Forum eBook

    Earlier this summer, Federal and tech industry leaders convened to talk security, machine learning, network modernization, DevOps, and much more at the 2016 Federal Forum. This eBook includes a useful summary highlighting the best content shared at the 2016 Federal Forum to help agencies modernize their network infrastructure.

  • Sponsored by CDW-G

    GBC Flash Poll Series: Merger & Acquisitions

    Download this GBC Flash Poll to learn more about federal perspectives on the impact of industry consolidation.

  • Sponsored by One Identity

    One Nation Under Guard: Securing User Identities Across State and Local Government

    In 2016, the government can expect even more sophisticated threats on the horizon, making it all the more imperative that agencies enforce proper identity and access management (IAM) practices. In order to better measure the current state of IAM at the state and local level, Government Business Council (GBC) conducted an in-depth research study of state and local employees.

  • Sponsored by Aquilent

    The Next Federal Evolution of Cloud

    This GBC report explains the evolution of cloud computing in federal government, and provides an outlook for the future of the cloud in government IT.

  • Sponsored by Aquilent

    A DevOps Roadmap for the Federal Government

    This GBC Report discusses how DevOps is steadily gaining traction among some of government's leading IT developers and agencies.

  • Sponsored by LTC Partners, administrators of the Federal Long Term Care Insurance Program

    Approaching the Brink of Federal Retirement

    Approximately 10,000 baby boomers are reaching retirement age per day, and a growing number of federal employees are preparing themselves for the next chapter of their lives. Learn how to tackle the challenges that today's workforce faces in laying the groundwork for a smooth and secure retirement.

  • Sponsored by Hewlett Packard Enterprise

    Cyber Defense 101: Arming the Next Generation of Government Employees

    Read this issue brief to learn about the sector's most potent challenges in the new cyber landscape and how government organizations are building a robust, threat-aware infrastructure

  • Sponsored by Aquilent

    GBC Issue Brief: Cultivating Digital Services in the Federal Landscape

    Read this GBC issue brief to learn more about the current state of digital services in the government, and how key players are pushing enhancements towards a user-centric approach.

  • Sponsored by CDW-G

    Joint Enterprise Licensing Agreements

    Read this eBook to learn how defense agencies can achieve savings and efficiencies with an Enterprise Software Agreement.

  • Sponsored by Cloudera

    Government Forum Content Library

    Get all the essential resources needed for effective technology strategies in the federal landscape.


When you download a report, your information may be shared with the underwriters of that document.