ED 245 683

AUTHOR;

TITLE

INSTITUTION'

IR n() 755

A - -Horan., Richard V. Kendrick, Keith S.

President's Private Sector Survey on Cost Control..

Management Office Selected Issues, VolumaNyII:

Information. Gap in the Federal Government.

Executive Office of the President, Washington, DC.

President's Private Sector Survey on Cost Control.

PUB DATE 83

NOTE 347p.

AVAILABLE FROM Superintendent of Documents, U.S. Government Printing

Office, Washington, DC 20402.

PUS TYPE. Legal/egislative/Regulatory Materials (090) --

Reports 7-Research/Technical (r43)

. - EDRS PRICE MF01/PC14 Plus Postagi..

DESCRIPTORS AdvisOry:Committeesv *Cost Effediiveness; Efficiency;

*Federal.GoVernment; Government Role; *Information

Needs;.InforMation 1)roCessidpg; *Information

Utilization;' *Management Information Syttems; NeedS

Assessment` Policy Formati6nl'Public Administration;

Public Agencies Systems Analyiis -- IDENTIFIERS *Presidents Private Sector Sun/6y on Cost Control;

Reagan Administration

ABSTRACT

Established by Executive Order 12369-on,June 30,'

,1982, the President'sJ,rivate SectOr Survey on Cost Control (PPSSCC)

carried out its mandate throligh an executive committee of 161'

higb-ieVel private sector executives.. The committee set up a

manageMent office and 36 task. forces with 1,300members The task

forces were co-chaired by members of the executift-,committee. The

PPSSCC was directed tO4o,into the various departments and agencies

and look at them as if:they were considering a takeover or a merger.

The. project team found that key information that would be needed to

make a decisi9n on such actions was often not available, and when

available, was frequently out of date, inaccurate, or incomplete.

This.information.gap, a collapse in the communication or reception ofr

knowledge, causes a lack of data translated into critical

information,:needed for accurate, timely,_ and perceptive decision

making. Individual task forces made recommendations for the

departments they investigated, and an'overall.progiap was recommended

that would include: an agency-by-agency needs assessment;

establishment of data collection standards; adoption of a systems

approach to information processing; improved utilization of existing

data; and implementation of a structure to, facilitate the information

management process. This preliminary report includes an executive

summary, issue and recommendation summaries, and a summary list of

recommendations and savings. A compendium of information gaps

reported by the task forces and one page summaries of their findings

are appended, as well as diicussions of several selected issues.

(DMC)
U.S. DEP

NATIONAL I

EDUCATIONAL,RtS0 CEN V. This document 11.1i

received from Mir'

originating

Minor changes ',lave

reprodUction quality:

Points of vienrr orbpin

ment do not, necesarily

position or policy.

PRESIDENT'S PRIVATE SE

MANAGEMENT OFFICE

VOLUME_ VII

J, 4,1 tgpf 8.su

INFORMATION GAP__JiN THE FEDERAL GOVEA

(

APPROVED BY THE SUBCOMMITTEE .FOR HE

IOU, EXECUTIVE 'COMMITTEE I;. WINTER 1 83

J. .For sale by the Superintendent of Documents. U.S. Government Printing Office, WashIt gton, D.C. 20402
- ci . "7'

THE P-RESIDENT'S PRIVATE SECTOR -SURVEY Ors) C05T CONTROL

The Honorable Ronald Ragan

President oe,the States

The White House

Washington, D.C.

ilieer. Mr. President:

January 20, 1984_

.The following Report represents. the results of the PPSSCCr

Management Office.Selected ,Issues Report on -Informati-on Cap in.

to Federal Governmdit.

Work on the Report was directed by Richard V. Horan and_

Keith S. Kendrick and'reflects the combined efforrs'of 10 individuals w devoted extensive pro bona work to the OPSSCC-initiative. A list of project members is enclosed with this letter.

The Report'on Information Gap in the Federal Government

highlights major. recommendations ,Contained in other Pp5SCC'

reports which,' when implefientedi could- result in three-year

cost savings of $78.590 billion. BeCauSe these savings- were

preVioUsly raPorted.in.other PPSSCC reports, they are not again

claimed in this It should be noted, *howevr, that some

of the recommendationd may require several years for the savings

to be realized:. While all facets of Information Gap in the

Federal Government could no, surveyed in the time'allotted,

areas selected for review e considered to offer significant

potential for cost control and improved,efficiency. 'The

importance of the accompanying recommendations rests on the fact

that they represent'the potenti44 (:)r better utilizing finite

resources eveqable to .the Federal'Government. . -Clearly, other opportunities for cost ,savirigs -and revenue

gene exist but, ut, dpe to limited time an personnel resourc s, they Could not be pursued:; Several are suggested for

furth r review because they offer future potential savings and

revenue oppo'tuhities.

On behAlf-of the Project Directors and members, I woUld lfke

to express Our deep appreciation for the opportunity to have been

of.service ro you and the members,of i!our Adminis.tration.

Respectfully,

StrPet. N.W. Suite 1150 , Alt

(202) 466-5170

f /7'

race

xecutive ,Comrni't

) _t;006
. > COMMITTEE MEMBERSHIPPROJECT DIRECTORS

Richard V. Horan

Preside/it

Citizens Public Expendit

Survey, Inc.

COMMITTEE MEMBERS

Thomas M. Dersch

Mary V. Hornig

Rosemary B. Machalek

Jeffrey J. Michael

Joseph W. Rio

Tony A. Trujillo, Jr.

Andrea L. Tyndall

Marjorie T. J. Wong

p

Keith S. Kendrick

Assistant to thTredident

Cbemed Corporation

Survey Management Office

Sury = Management Office

Survey Management

SUrvey ManageMent

Survey Management

:Survey Management

Survey Management

Survey Management

Office.

Office

Office

Office

Office

Office
'PRESIDENT'S PRIVATE SECTOR. SURVEY ON COST CONTROL

I MANAGEMENT OFFICE SELECTED ISSUES

VOLUME"VII

INFORMATION GAP IN'THE FEDERAL GOVERNMENt

APPROVED-BY THE SUBCOMMITTEE FOR THE

FU41.,XECUTIVECOMMITTEE, WINTER 1983
PREFACE'

On June iLo, 1982, President -Reagan signed Executive Order

12369 ormally estLablishing:the.Presidebt's Private Sector Survey

on Cost Control (PPSSOCin-the ExeCutiVe Branch of the FederalGovernment. An Executive Committ-eeunder the chairmanship- :of,,

J. Peter Grace was,establithed, consisting of 161- high-level.

private sector executives,--mostly chairmen and chief executive.

officers-from many of the pation"S leAding corporationS: . Briefly staiedf.the presideht directed-the,PPSSCC.to:-

c o Identify opportunities for incteased efficiency and

reduced costs ac ieyable by execatiVe'actionor

Determine areas Where managerial accountability can be

enhancedand administrative controls improved. _ Suggest short- and tongrterm managerial operating

improvements.

6, Specify areas where further study can be justified by

potential savings.

o Provide'informatIon and data relating to governmintal

- expenditures, indebtednesp, And personnel management.

T4 Executive Order also provided that "the-Committee is to

funded,cstaffed,and equipped . . . by the private sector . 'without cost to the Federal Government." To implement this

'objective, the Foundation for tlpe President's PrivaieSector

Survey on Cost Control was established. It formed a Management

Office, which oirganized thirty-six "task forces,"-each co-chaire

by twfl,g&rnoreigombers of the Executive ComMittee, to dePthe

"prelifillftry eNpOrts."

, Twenty -two, of these task forces were assigned to study

specific departments-and agencies, and the remaining fourteen

studied functions cutting Across Government such aspersonnel,

data'processing and procureMent. In addition to indiviJual task

'fcirce reports, the Survey. Management Office has issued a series

of'reports on selected issues. Apart from the Executi,,e Committee

in ito official capacity, none of the task force members had any

.Authority to make recommendations to departments and agencies or

to the President.
A listing of the thifty-six task force* follows:

Aciriculture

Air Fotoe

Army

Automated Data Processing/Office Automation

Boards/Commissioni-Banking

Boards/Commissions-Business Related

Commerce

Defense-Office of Secretary

Education 4 EnergyAincluding Federal Energy Regulatory

Commission and Nuclear Regulatory

Commission)

Environmental Protection Agen4e/Small

Business Administration/Federal

Emergency; Management Agency

Federal ConstrUctiOn Management

Federal Feeding

Federal hospital Management

Federal. Management Systems

FinanciailhAsset Management

Health 4 Human Services-Department Management/

Human Revelopiant Servicei/ACTION

I

Health i Human Services-Public Health_

Service/Health Care Financing

Administration

Health 4 Human Services-Social Security

. Administration

Housing 4 Urban Dilvelopment

Interior

Justice:

Labor )

Land,4Facilities and:Personal Property

Low Income,Standards.and Benefits

Navy . Personnel Management

Privatization

Procurement/Contracts/Inventory

Management

Real Property Management

Research and Development

State /AID /USIA

Transportation

Treasury

User Cherges

VeterensAdmimistration

Each of the 36 task :forces prepared a draft report and, with

a few exceptions, an appendix, supportingthe recommendations.

contained in the task force report% Thoseappendices are on file

at the Department of Commerce's Central Reference and Records

Inspection Facility. It should be noted that recommendations

relating ro,any- one' federal agency maybe included not only in

the appropriate/agency task force report but also in the reports

of the-functional cross-cutting task forces.

-1! - It important to note that cost savings, revenue, and cash

acceleration- opport'un'ities in this report may duplicate similar

dollar opportunities reported.in other task force repor'ts, Th

there.may be instances of dpuble ,counting of dollnoopportuni

between task force reports. These duplications will be'nettedpap 41E10 Final SUTimary Report to the President. Additionally,

dnlarTStimates in this repbrt are based,on reasonable and

defensible,assumptions, including standard three-year projectip s

.based-on when first, second, and third year parti4'or 11

implementation ARilr occur and not specific fiscal years.

Accordingly, estimated savings or revenue opportunities are

understandably of a "planning" quality and not)of a "budget"

quality. Therefore, the reader should guard against drawing

cohclusions or making dollar projections, based on the disclosures

contained only ifs this report.

r
sa. _A glossary of terms used in categorizing-PPSSCC-identified

opportunities follows. °' = . ./

] o Cost Savings include: . Cost Reduction

Cost Avoidance

OMB

Revenues include:

-rtauction of budget

expenditures, Ibnerafli

, .ongoing

avoidance of cost for

anticipated but-unbudgeted

expehdituresi generally

ongoing

Revenue. Enhancement - increased .receiptIof existing

or new revenues, generally

ongoing , $ \._

Revenue Acceleration - sale of fixed asset for cash,

generally one-time

Cash Acceleration

ri7TUffes:

improvement of the cashflow,

generally by accelering the

cash inflows and/or

'4111.11114grating the cash outflows

nerally ongoing, but may be

ne-time-occurrence.

The standard three-year projections'of.cost wings ao4

revenues include 10% inflation in Years 2 and 3 On revenue

accelerations and cash accelerations, savings a laimed on th

interest avoided'which is estimated at 10%. The rates reflec

generally prevailing' rates at the time the Task Force reports

were prepared and may be adjusted, as necessary, in the Final'

SumMary Report to the President.

4,

In addition to identifying specific opportunities for cost

control and improved efficiency, 'PPSSCC sought to identify the,

'appropriate' implementation authoOty,fopach recommendation.'

Because of the complexities of the appropriations process, as

well as historical precedents, however, further data Could result

in a change in the PPSSCC-identified authority.

-a
All 6f'the PPSSCC report's Were.considered and acted:upon in

'a meeting open TO the public by,a Subcommittee of the Executive

Committee'bt PPSSCC, .alohg with'other -statements and recommendations. Written.comMents submitted by the public, if ahy,.have'

been forwarded'to tht,White House slOng:with the final PPSSCC

ieports. In addition to individualrepbrts, the PPSSCC Executive

Committee will adopt a Final ummary Report to the Prisiderit,

%1

summarizing the scope".of its in ividual task force'reeommepdations and offering general con usions and advice.: This Summaroy

Report is tentatively scheduled for release in late Fall.

. . -

F. a
. TABLE-OF CONTENTS

EXECUTJVE SUMMARY

I. INTRODUCTION

II. ISSUE AND RECOMMENDATION SUMMARIES

A. -_Process

INFO GAP 1:

INFO GAP 2:

INFO GAP 3:

INFO GAP 4:

B. Structure

Infbrmation-Needs Assessment

Information Collection,

Information 'SYstems

Information Utilization --

ComOuter Matching

4

Page

Number

1

15

YS

44

55-

82

INFO cm 5: A Structure toFacilitate An

. Information Management Process 95

III. SUMMARY LIST OF RECOMMENDATIONS AND SAVINGS

IV. APPENDIX

4 4

119
Table

II-1 Possible Industry Goals and Critical.

Success Factors 21

11-2 Information Needs Assessmeht Via the, a Critical Success Factor Technique 1 27.

11-3 Information Needs Assessment 33

11-4 Information Collection -55

'TABLE OF EXHIBITS

1

, Title

Page

Number

11-5 Typical Steps in the_Federal Acquisition Process

11-6 Information Systems

11-7 Information Utilization -- Computer

Matching - 93

LI-8 Structure -115

70

78

Exhibit Title Page

I-1' The InforMation Management Problem in

the Federal Government 7

1-2 The Information Problem and Its Solution

I-3 An Information Management Process and

Structure

1-4 .Overview of Information Gap Report

II-1 An AcqUisition Assessment

II -2 Systems Acquisition,F14 Chart

10 -

12

14

37

76

11-3 A Structure to Facilitate An Information

Management Process ,s___ 109

II -4 Representative Job Description:

Information Management Coordina for 112

- 11
.EXECUTIVE §LiMM/Y

V
f.

EXECUTIVE_SUMMA:RY

A "Infocmation Gap" As a collapse:Th the cOminunicatoion

or reception of knowledge. This desired knoWledge is,far:

more than simple, raw data. Instead; it' id-dat# that has

been translated in,t"o'critical information which allows

accurate, timely and perceptilie decision-making: This

failure to convert raw data to 'Critical information, or

."informatiom gap," may4be the'result of:

too much information of the wrongfki-ndq'

o too ,little inforfrlation of the tight k.fnd;

inconsistent, incompatible or unverifiable

'information; . o information that is not timely: or

information that is toodiffigult to locate in a

single, usable form when needed.

.":When President Reagan established the Presidents

Private Sector- Survey on Cost Control and asked it to tdentify waste: and inefficiency in the Executive Branch of

Government, he .calLed. on -private aectbr executives to come

into the various depa"rtments and agencies and look at them

as if they were considering a merger or a .takeover.

AS the 161 leadincfbUsiness executives (and some 1,300

task force members). undertook a review of the Federal'

Government in response to.this request". they found that key

information regarding. Government%servicei, personnel, facilities, equj.Pment, perfotMance; and cost often, was not

'ayailable and, when available, 'was frequently out of date,

inaccurate or incomplete. We found that such necessary

information not only was. unavailable at a Government-wide

level, ut also was unavailable at virtually. every, manage-

`'ment2:1, 'n :every. department and agency in ther-Federal-

, Governmen These information "gaps" made ,the concept of

looking at the. FederaGovernment as a. merger or acqpisition

candidate impotsiblel4since key information necessary to

make a biy of no-buyi:decision Was not availdble. In addition; it'-..became evidant'to the private sector executives

that cri.tical information was missing not only with respect

to making :an,:acquisitionAecision but, more portantly,

with reapedt to running:the Government even, were

acquired'.

qv*
Information gaps permeate virtually every department

and agency of the Federal Government and every functional

area. A detailed acquisition analysis appears on pag"e 36. of this'Report. A few highlights of the missing information

include:

. Financial ande,Accounting

o The Federal Government has over 300 se4rate

accounting, systems of which-about only 60 percent

have been approved by the General Accounting

Office. None,of th4se systems follows ,Generally

r.) Accepted Accounting Principles (GAAP) standards

which are used-in the private sector and.by a

growing number of state and local governments.

o The Federal,Government does not have accurate

debt'status reports. In fact, the Veterans

Administtation's '(VAT4recovery rate for the debt

collettion activity is low because accurate

information, regarding the value and status of the

debt owed the VA is not available (VA 3).

Financial Reporting Systems...

The Federal Government does not prepare balance sheets,

:statements of operations, statements of changes in finantial

position and cash flow; and interim fihancial statements.

This lackof.information results in

o the Environment Protection Agehcy's inability to

provide accurate and timely cost data (EPA 12);

and

the Urban Mass Triins.pgrtaion Administrationl.s

.inability to process and monitor grant payments

properly.

Project Management...

o Agencies have no cost'accounting structure that

1permits the accurate tracking of all costs asso- . .ciated with:publishing. Therefore, the a encies

do not know what price to charge to recov r costs

(PPAV 2).

The National Park Service does not know with cer-,

tainty the costs of collection of their fees and

therefore does not know what-to charge to recover

their costs (USER 4).

4
e

From the acquisition analysis it was clear that the

information gap deficiency in Government is the result of a

broad and systematic management failure. 'This failure is,

summarized below_ in terms of four roadblocks that halt

orderly processes and ,a structural leadership void.

JP.

Roadblocks

o Identification -- The needed data for effectiveC

decision-making and management control are not

identified, leaving management with too' much data

of the wrong kind or no dta on which to-base

decisions. 14

Quality -- The accuracy, timelinedi or consistenty of the data are poor, thus reduCing it

usefulness.

Automated Data Processing' (ADP) -- Once the data

are collected, they-must be processed into usable

information with either manual or automatic,

systems.

o Analysis -- Even if good information is,identified, quality data are captured, and the system

processei the data-properl , the information must

be put to some 'purpose. I information is not

utilized, management decisions are still hampered

by.an information gap.

Structural' Void

o. Nosone is attempting to coordinate the selection

and flow of management. information. Without an

asaignment of responsibility, overcoming the

roadblocks cited previously is difficult.

These five systemic areas, four process and one structural failure, inflict costly mismanagement on the Federal'

Government. Although PPSS has not captured all of the

information gaps in-the Government, closing the gaps cited

in this Report would lead to three-year cost savings and

revenues of $78.6 billion. This dollar amount duplicates

savings, and revenues previously reported by PPSS and is

presented to provide the reader with.a perspective of the

scope and significanCe of the problem.

Individual task forces recommended solutions to the

information gaps they identified. In this report, we
0

recommend an overall program which, when implemented, will identify and solve additional information gaps and, provide

an institutional approach to continually evaluate the ihformatibn flow in the Government. To achieVe-this institutional.approach and these dollar amounts, "a '.new informktion

managementprocess and structure are ,recommended:

Conduct an agency 7by-agencyneeds,assessment. ThiS 'first step in the information management proceSs,involOes

identifying the information tbatjs.!neededfor effective.

decision-making. To' identify an brganiZ.OiOn's information

needs, a manager must-e0ablish.,the agencrs critical sudcess facorsbased-9n'erivironmental trendsandconditions,

generally accepted private sector standards applicable to the organizationi'and organizational mission (INFO GAP 1)-.

Establish collection. standards: piaStep'requires

establishin uniform standards for'data collection in the . areas of krelevarice, completeness, accutacy,z,tiMeliness and

consistency. (INFO GAP 2).' - Adopt a systems approach to'infOrmatfoOprocesding. A

systems apptoach entails a review Of data alidrsyStem interrelationships. Greater coordination in upgrading ADP

systems and new acguiSitions is essential to,improveddaa

flow. File structure standards add:a Software clearinghouse.:

would Contribute to greater effic.tindy (INFO GAP 3).

Improve utilization of existing data. Th'.s step

involves an ongoing review and assessment of agency performance and sharing of. relevant data between agencies.

Computer matching'i,s'a major utilization tool available to

Government managers to verify the accuracy of costs and

payments (I/'PO GAP 4).

-)Qe Implement, a structure to,facilitate the information

management process. At present, interagency ,and interdepartment structural barriers impede effective infotmation

flow. An information management coordinator is needed to

link the:needsof the Executive Office of the President,

departmental.and agency leadership, and operating managers.

The information coordinator would provide the needed liaison

betieen operating personnel, technical experts such as

Agency InformatiohResource Managers, and top -level decision

makers,:(P1F0 GAP

Summary

The informatiOn'gap-problem in Government permeates _

virtually' every functiOnal. area -- finance, personnel,

product management,' trUfacturing, distribution -- and

iv , 16
4

4 every department and agency in .the Federal GoVernmnt.

8i.nce the problem is so substantial sand the Project T'aM

has nd,reason to belieVe that all .information gaps hake'

beeh located, a simple listing of gaps to be closed woutld

be misleading and inoomplete, InPtead, the Project Team

recommends a systematic, incremental .approach which :estab-.

rishes an ongoing ateucture'and.pces4. to upgrade the:

informafjon, that Government decision makers have available

t.6,thm.

2

N.

P
INTRODUCTION
1. INTRODUCTION

In making any major decision with.'resaect to its

'internal and external operations, the'ptiVate sector relies

heavily uP'on basic kinds of information which will allow it

to mace an informed and profitable decision. In undertaking

its review of the Executive Branch of Government, the PPSS

private sector executives found that such information was

basically lacking.. Indeed, one of the most critical problems which they Identified on a Government -wide basis was

that of "informatidn-gaP."

"InforMation.gap" is a.colfal5se in the commtinicatOn or

reception of knowledge. This desiSed knowledge.s far more

than simple, raw data. Instead, it is data that has been

translated into critical infopmation via an inforMation management

t process and structure. This Report is concerned.

with information that is regularlyutilized in the private

sector, as a part of standard operating procedures to achieve

accurate,timely and perceptive decision-making. An

"information gap" may be the result of:

o too much information of th4 wrong kind;

o too little information of the right

o ---sistent, incompatible or unverifkable infor-,

maLLon;

e information that is not timely; or

information that is too difficult to locate

i.n a simple form when needed.

Therefore, an information gap is critical information that

is not gathered, not of sufficient quality, or not readily

accesdlible to decision makers in the Federal' Government.

4

These simple sounding yet often deceiving:communication failures lead to costly mismanagement in:the Government.

For example, the PPSS Task Force on the Office of.the

Secretary of Defense found that critical information on inventories is not accurate or timely i the Department of.

Defense leading to eXcessive stock buAldUp and unnecessary

obsolescence.' This information deficiency will cost tax1J
. payers t6.1 bi1Alion overthe next three years (OSD 2).*

a different part of the Government, the PPSS Low Income

Standards Task -Force reported that inconsistent and unavailable data.makes income verification for needs. based programs

difficult. This: lackof information resulted in ovenpayMents.,of $4.1 billion in 1982 (LISAB 4)., As.these-two

examples --:Of more than 125 contained in this RepOrt,-=

demonstrate, information deficiencies lead to costly'

mismanagement.

Marion'Aiarper, Jr., formerly the president of a major

international adVertising agency once noted, "To-manage a

business well is to manage its fi4gre; and to manage its

future is't6 manage information.. ,The' technologiC1,

revolution of the last 30 years'has,, made* a vast amount of

new information" available to managers. 'Computers, photo.-

Copiers, (DE-tilting satellites that allow instant teleconferences.across time zones and continents, personal computers-the size of typewriters which can handle more data

than major. systems the size. of small houses could handle +20

years ago, videotape recorders, and other-new technologies

have radically altered the amount, type and speed at which

information is available to the modern manage. In Lhe

midst of this technological,' ,evolution. many. corporations

are investing considerable'management: nergy to harness

information better and improve decision'- making. Based 'on

our neView,4the Projec-t Team concluded that the Federal

N.GoVernment does not manage its information well and that

managing it better could save at least, $78.6 billioner

three years. . 1 x To assess the extent of the inforMation_gap problem in

the Federal Government., the SpeCiaI Report Team on Information Gap reviewed all 36 task force reports and the Management Office Selected'Issue Reports (MOSIR) released as'of .-. November 8, 19.83. The review was undertaken to collect the

primary examples of information deficiencies that affected

management decision-making.

(._

1/

Throughout this Report, the information gaps are

referenced by a short abbreviation. In this case,

"(OSD 2)" refers to the second issue in the Office of

the Secretary of Defense Task Force Report. A listing

of task forces and theirTabbreviations appears in the

table of contents to the Appendix, which is contained

in this volume.

Philip Kotler, "Marketing Management, fourth edition,

(Englewood Cliffs, New Jersey: Prentice-Hall, Inc.,

.1980)4 p. 601-.

20

2
Once the initial examples were collected, the appendices to Selected reportS'were-also reviewed. Where appropriate', project managers were contacted to, verify details of

specific findings,.sinde the-"informatiOn gap" per se-was

not a central focus of the task- fotce revieWs.- Task forces

were not asked and most made no effort to catalog xamples

of information deficiencies. Instead, discutsion af information gaps were included in the task force reports only

when the task force determined the deficiency to be a major

hinderance to efficient, effective management of the particular area under review. COnsequentlyv the PPSS reports do

not contain an.exhaustive review Of information problems in

the Government,

The net effect of the review,was the establishment

PPSS compendlum of 'information gaps, whie7h appears i

Appehdix Section of this Report; The ,(Aliperidium .7cmcaills

127 specific information gapclations, from 40 of 41 task

force repOrtS and MOSIRS, affecting issues with $78.6 billion in three-year cost savings and revenue enhancements.

compendium provided the Project Team with a dta

base- from which,an analysis of the 'components of the information gat, was possible. The first level of analysiS

volved a preliminary acquisition analysis, similar to the

type of review a private sector firm would-conduct in the

early stages of considering an acquisition or merger.. The

review encompassed a wide range of functional areas including financial and accounting data, reporting systems and

procedures, organizational sttucture, industjrial relations

(personnel), marketing and manufacturing.. J,

ThisAcquiSitlion analysis revealed that information

geos exist in every functional area explored and permeate

virtually every department and agency of the Federal Government. The number of information gaps by functional area

appears in the following table:

4

Function

Financial

Personnel

Facilities

Materiel

Benefit Programs

Support Services

Number Cif Citations

42

14

10

27

20

14

Total 127

From this acquisition analysis, it yes clear that too

little specific information exists to properly evaluate the

quality of the acquisition candidate. In 'fact, the informa2
tion deficiency is so great that operating the Government if

iE was acquired would be all but impossible. Consequently,

the candidate would be rejected. A summary of the acquisition analysis appears in EXhibit If-1 which begins on page

36 in this Report. '-

. ., 1_

. Xaditionally,.the-acquisition analysis shows that the

inform ion problem is so broad and pervasive thaE,it calms

only:b1 the.:resuit of an ongoing, systematic. management

failure. Based on the size of the problem,. the fact that

all'Of the information gaps had not been captured in the

PPSS task force reports, and the constraints on.time and

'resources available for this Report, the Project Team con7

clAed that any .effort -to offer specific recommendations to

res61116-each information gap located by the. task forcet

woUldftresult in nothing more than treating then symptoms of

the problem rather than its caus- is In effect, such a

piecemeal approach would only turther exacerbaillthe

problem. Instead, the PeOject Team chose to address the

more_Jundamental,'systematic causes of thc,,management

failure that has led to such a vast problem. Consequently,

'this report focuses on how to attack such -a large and

pervasive problem in an incremental and rational manner.

. .

.

. , To.establish am incremental approach to solving the'

information_ gap dilemma, a second level of analysis was

',- required. To understand what goes wrong where and why it

happens, the second level of analysis, focused .on the

principal failures of the present system. From this

c

nalysis, the Special Report Team concluded that there are 47:

twofunclamental, systematic failings contributing to the

formation,gap in Government: roadblocks and leadership

voids.

o Roadblocks halt processes. Four major roadblocks

prevent effective translation of raw data into

management information.-

o A leadership void exists. sys void allows too

much raw data to reach top cision makers,(massive data flow), and data axe not tailored to the

different needs of the, various levels of management.

Roadblocks Halt Processes .

The four major, roadblocks preventing effective teSns7

'lation of, raw data into management information are identification, quality,, systems and analysis. i;

22

4.
,

. .., -- Needed data. for effective decisionmaking an4:management control arenot identified, leaving

management with too little spe ific information or too much

raw data on which to base deci ions. For example, the i

Army.

does not know how much it cost to operate its Learning

Resource Centers; therefore, a management'. analysis of how

cost effective this fo m of training `is as `compared with

other forms is impossi le (ARMY 9).

IDENTIFICATION

(QUALITY -- The accuracy, timeliness or consistency of

the data is poor, thus reducing its usefulness.' For instance, officers in the Small Business Administration,

receive ,"30-days and over'" pasttdue notices five' to six

weeks after the fact, diminishing the ultimate collect- -. ability of many, past due loans-(SBA 2).

,DATA PNRESSIOG (ADP)i-- Once the data are (AUTOMATED collected, the nextstep involves proceSsing.itt into usable

'data-with either automatic .or manual systems. If the system

doeS not function accurately and in a timely manner, efficient management is not possible. The Government has'17,000

incompatible. computerS: They cannot "talk" to one.another,

making the dissemination and' comparison of much, data impossible (ADP 1).-

-- Even if the data are identified, qualit

data are captured, and the system functions properly, an

information gap can occur by simply failing to analyze t

data. The PPSS Procurement Task Force found that vendo

experience data are collected but are not often utilized,

- leading to repeat busi ss, with unsatisfactory vendors (pROC.

19).

A Leadership Voi Exists

The second systemic failing of the management information System in the Federal Government is that no one is

coordinating or managing the information needs of decision

makers. The efforts that do exist tend to focus narrowly on

computers as machines rather than the more important issue

of how to get a critical'piece of data from one operating

unit of an agency processed and captured, translated into

useful information,, and transmitted to the appeopfiate decision maker. This void results in inundating mandWers with

an overabundance of data and the identical report. going to

differentmanagers with different needs. The PPSS Air. Force

Task- Force Report notes that the Air Force is.unable to get

the 17sential information it needs on inventory management.,

The pritary reason for'this problem is that the 104-archaic

computers generate some 500,000 pounds of paper each month,

5

23.
4

or six millidel pounds per year, t the Air Force logiitids

centers. Such massive informati n f]gws raise the, question

of whether anyone benefits from 11 that paper (USAF 13). . . . , -. Additiohally,',under the curr nt management. information

system, data ace often hot tailor d to-the level of management involved or the type of deci ion to be made at that

lever. -For the purposes of this nalysis, 'three fundamental

leYelsof management'are relevant Executive. Office of the

President (EOP)', department/agency leadership, and operating

lihe.managers..! Federal vehidle management is a ,good example

of the concept thatdifferent'levels of management require , different information. Ed') needs_to know the historical

trend dt vehicle costs and unit growth of vehicles over a

five-year period, with a comparison of data acrosis?departments and agencies.' The individual department an agency

leaders'need to know the ,specific co s by divisions, how !. , many cars there are and for what.pur,4se the cars are used

in their area of responsibility in or er to uncover ineffil

gient operations. The operating line)nanager needs,to know

how many cars exist by age in terms of months and miles of

Operation, to plan maintenance and spare parts requirements.

Clearly, the information needs of each, of the three leyels

are/different,

'These two fUndamental, systematic failings, of the

present management.infornation system. and their implications

,are summarized-in'Exhibit I -1.

11,

(Exhibit I-1 on following pasel

24

6

Int
Exhibit - THE INFORMATION MANAGEMENT

PROBLEM.IN.THE FEDERAL GOVERNMENT'

pROBLEM:,

INFORMATION MANAGEMENT

L ROADBLOCKS

INFORMATION

OVERLOAD

MANAGEMENT.

DECISION MAKERS

ANALYSIS

RAW

DATA

QUALITY

IDENTIFICAJION

OPERATING LEVEL

A

r

11*

IMPLICATIONS:'

a. ROADBLOCKS j-- IMPEDE DATA FLOW, ANY ONE ROADBLOCK CAN PREVENT THE RIGHT DATA FROM REACHING THE RIGHT MANAGER AT THE RIGHT TIME.' EACH ROADBLOCK MUST BE OVERCOME TO INSURE EFFECTIVE DECISUN MAKING,

TOO MUCH RAW DATA

OVERWHELMS DECISION

MAKERS, ONLY THE

MOST CRITICAL DATA

SHOULD REACH THE

rEcicioN MAKER,

DECISION

MAKER

INDIVIDUAL NEEDS OF

DIFFERENT MANAGEMENT

LEVELS NOT RECOGNIZED,

DATA REPORTS MUST BE

TAILORED TO SPECIFIC .

. MANAGER NEEDS.

7
The Solption:- , An Information Management Process'and-Stoucture

, t .

. To overcome the failings of the present managemtn

information-,digfutct,ion, the PrOject ;Team concluded thitt an

intotmation'menagemat,process.and Structure must 'be mple'-'

merited. Thi8 "f- afiOn matatjement, system would be::

...a strUctilted,'interaCting ComplOCOfpersons!:

technology, and processes designed-to generate

an orderly flow of pertinent information;-col-.

lecEed from both intrw and extra-department/ .- a gtcy eciirces,Jor Lire as the basis for fdeCf.- '"'" 1 .. . sipn mAkitgnecified-areas of management .. respOnsibil' '.- 'f'r , ,y.A. . The iftformatko .;itlatia. ent. system is designed to allow each

department 0 enly o1determite its, clp needs relevant.to,

its indivfcW a41. and Within the gegkral 'goals of the

Officeof'',A04004.1W T Budget or the.proposed Officq''of

Federa-AIWAigepeolhe system is not intended to ,create a

missivepro4r4"that4nnot moVik forward until every depart-

, ment:Or A041;ey,is .(51.1p5batd, .Instead, a practical and incrementalystem p, reinm20ed. Section II of this Report is

a detailed presentet.14fbi this system. A brief summary, of

the sycstem-f0116ws,-/ ?'

. Lt ',.t, - Process 4,Fg, -4 ,.:74 iiA.,.- --, '"-4G--"..4 : I; 4, ..,;1 - .. To ovetctitie-W,girocess- problems in the Federal Governiment , it iS.,t*tesg44'y to recogniie that any one of four

roalablockV identiitication, quality, ADP and analysis -- :.

. can prevent raw data 'from becoming useful management information., Thereforeach of the roadblocks must be viewed as

&hurdietAat shollld be monitored and avoided. More importantlyi,the^mana'ger should establish a process-to overcome

each roadblock. Each oct.he steps in the recommended InforMaidtMatagement..ProcesS is highlighted below.

,pENTIFICATI?W'IDHLOCK. [NEEDS ASSESSMENT PROCESS

Thefirttstep in-the Dpformation Management Process

hat will ultimately be

Ohis step lays the

rocess. To identify

involveSidentifying the'informatt

needed for effective decision-maki

foundation for subsewett steps in

2/ See Samuel V.,Smith, Richard H. Brien, and James E.

Stafford,dpds., Readings in Marketing Information

0 Systems (Toston: Houghton Mifflin Company, 1968), p.

26
. . organizat.ion's informettion needs,

an understanding and'knowledge of

.manager stiduldlaVe , .

.;... . -.. ." '''4'-fgarlization and its,',Oritical sucdess:factorSr

---.4 , ._,7t- . -./. . Ii0'401*ntaltrends:and ccOditions, and

9Anetalry accepted private 'sector 'standards

applicable to the organizAtion.

QUALITY ROADBLOCK, tcoLLECTIop pRocEq.§:

: ' ' -

,Once an organ'ization's. information needs have-been identified, the:. next 'step is:,thephysicat.'c4311ect,ing of data.

This step is::importantto the prot4ss because the ty.pes.and

quality of the AatA collected will ultimately affect the

inforthatiOn.produced. It is difficult to produde useful

and sufficient information 'without: the right. data input . SimPl.Y:seated.,:this,concept.is the :"ghtbage7in,

garbage -out" issue. This, Step '0!ablishing

s.tandAtds foedata'colleC.ti:d4 along such dimensions as

relevance, odthpleteness accuracy, tdmelipess.and

.cons'iSeency.

IkDP .ROADBLOCK SYSTEr,It'.pROCaSS

Once',the data.are.00llected the data are RrOcessed into

usable inform-ation,Datprocessing is accomplished'-via,

Y-stetfls, both' mantand :electronic-. This, step also

recognizes the importance of,not only what is processed,

but also the disseth at ion of the data Once it is proceSsed4

NALYSIS ROADBLOCK UTILIZATION PROCS$

If the right data are 'Collected and processed, it still'

must be' utiliZed to,ac6mplish the end goal: effective

management control and decision-Making. This.step:recog-.1

nines that fundamental infOrthatiOn utilization possibili -.

ties include ongoing trend analysis'and:CoMputer 'matdhing.

-. ., A critical. element;of thieprocess iS\,the Control of

the amount of data that reaches 4eoision:a0erS'and 'what,

information reaches whloh 'decision m'iket.. concept is.

basic to avoidingifo-rmation Overload. :1).liese Stept_of the

process, and. til'ei; implications are-summarized.i.ritxhibit

12; , ,(Exhibit I on follOwing page.] i

27 .
Exhibit ,I-2'

THE INFORMATION PROBLEM AND ITS SOLlUTION

INFORMATION

OVERLOAD

RAW DATA

. 141010;

INFORMATION

DBLOCKS

MANAGEMENT

ROA

MANAGEMENT

DECISION MAKERS

ANALYSIS

DUALITY

Executi ffic4

of the sident

Department/Secretaiy,

Operat4n47111anagers

PIMA*

INFORMATION MANAGENNI

PROCMS

.PECItrigIRS. MANAGEMENT

imropor I ON

t

IDENTIFICATION

OPERATING LEVEL

i NEE

OPERATING LEVEL

(ROADBLOCKS' VS. IMPLICATIONS: ROADBLOCK Tp,spccEssFuL TNT141; TM AMOUNT Of DATA.REALHING THE MAgES of tiAlutticHENI..DEclaiDlo nATiok MANAGfMOTTPROCfSS. MANAGER. T09 MUCH DATA REACH- HAALFTS, EACH LEVEL OP MANAGE.- ANY ONE ROADBLOCK CAN PREVENT ING THE MANAGER RESULTS IN MEW HAS DIFFERENT AND.SPECIPIC

IHE RIGHT DATA.FROM REACHING INFORMATION OVERLOAD AND TAiE iNFoRmATN4N NEEDS. SUCCESSFUL

.THE RIGHT MANAGER AT THE RIGHT lAItURE OF THE INFORMATION INFORMATION MANAGEMENT INVOLVES

TIME FOR. EFFECTIVE. MANAGEMENT PROCESS. GETTING 1HE E*A(T DAT A 'RE)uIRED MAKING. . r,r TO TOE PROPER MANAGER.
Structure.

When a new focus or process is detired in an organization, the structure of the organization must change to

facilitate the new.process and-to help the organization.

break out of its forMer way of ddigA butinest. In the pri-'

vate sector, a business that reachft maturity would most

likely shift to tighter budgeting, strictet controls and new-

.performance-based incentive systems. Different management

variables such as accounts ;receivable might-become more.

important than they were prior to reaching maturity.]/

These shifts in foCus requite new organizational-stibctures

to oromote-the change. c

The purpose of structure is to facilitate process and

to institutionalize'it as a part of the organization's culSfre. To achieve'a Particular' focus, such as an information

"'Management process in.the Federal Government, the Project

Team concluded that all levels of the Gpvernment manageMent

structure must be given a vested interest in the procesS.

Therefore, a new information structure is recommended to

monitor and manage information flow, coordinate the data

needs of each of the three levels of decision makers, and

facilitate.and'institutionalize the recommended process.

-The recommended structure includes a--Presidential task

force and department' /agency information management coordinators. The elements of .Structure (assignment of responsibility, staffing'leVels, liason functions, rules and procedures, and incentives) and their linkages to process are

represented in Exhibit 1-3.

Exhibit 1-3 presents an overview rot the major asoects

of the recommended "Information,Management Ptocess and

Structure." This Orocess'and structure stand between the

'operating level and management decision makers. There is-a

data flow from the operating level to the decision makers at

each relevant level. The information management processes.

and structure translate the data flow into an information

110:

flow by selecting and refining the into information for

the decision makers. With this info tion, decision makers

'develop plans and implement programs which enter an information decision flow that goes back to the operating level to

repeat the process.

[Exhibit.I-3 on the following, page]

a

3/ .Michael Porter, Competitive Sttategy:Tec

Analyzing Industries'and Competitors (New York : ,The Free

'Press, 1980), p. 250.
4

OJLL

AN INFORMATION MANAGEMENT PROCESS AND STRUCTURE

:22> ONMAMCERi.

Louie ell asingemeat Doelelee sabot'

isoctime

ell elhe Posalderit

8

"ipsetwerit/11 OPstttlq Irmegoe r

TO

ROADBLOCKS

OPERAIING LEVEL.

I PROCESSES I MEM IONS: OVERCOME MAJOR ROMItUlkl.

EACH PROCESS IS AN 1N1ERRELATED. ESSENTIAL STEP

40 THE ORDERLY CEON OF

'INFORMATION. A

AMOU111 OF.PAIA

INIMA441R. MUST LIMIT

111E Ai1110111 OF DATA FLOW

10 AVOID INFORMATION

OVERLOAD.

ttY11..01 mAlqfiEDTVI_PE:

0

CISION_MAREN. EACH LEVEL

LINKS 10 1101H EACH PROCESS

AND FINAL INFORMATION

RECEIVED.

IMUCIVII_BLEMILHAlt

STRUCTURE BRINGS

A FOUNDATION AND comp...-

NATION TO THE PROCESS.
An Overview of the Report

The Information Gap Report contains five issues4 There

are fbur,Ampcedural issues, INFO GAP 1 through INFO GAP 4,

and one structural.issue, INFO GAP 5. Each issue explores

the causes and solutions involved in the general discussion

of the information gap problem.

The first issue, INFO GAP 1, recommends conducting an

information needs assessment by each Federal agency and

department to select the four to six critical success factors most important to the solution of particular i- nforma- , tion management problems.

INFO GAP 2 proposes establishing uniform reporting standards for data accuracy, timeliness and completeness. The

data quality problem can be best-addressed by standardization of.the data collect-ion prodest.

INFO GAP 3 emphasizes greater cobrdinatton of ADP systems.acquisitions (including long-range planning and anticipation of future ADP needs) and the establishMent of a

Federal software clearinghouse. .This will alleviate the

present unsatisfactory conditions of Federal ADP systems --

and enable those systems to furnish information to

Government decision makers faster and dependably.

INFO GAP 4 adVocates increasing the use of computer

matching (information utilization) by all Federal agencies

and departments. This action will greatly improve information analysis by the Federal Government, resulting in more

efficient utilization of Government resources.

,INFO GAP :5, the structural issue, stresses the appointment of a Presidential task forceto study the information

management process, provide coordination between departments

and agencies,.and-oversee the implementation of recommendations contained in this Report. The task forpe would refine

and promulgate its own suggestions%while encouraging continuing interest in improved information management.

Exhibit 1-4 provides an Overview of issues and recommendations in the-Information Gap Report.

(Exhibit 1-4 on the following page]
PROBLEM:

IATION MANAGEMENT

ROADBLOCKS

LEADERSHIP

VOID

ANALYSIS

ADP

QUALITY

ENT1FICATION'

r 1 Exhibit 1-4

OVERVIEW OF INFORMATION GAP

(

REPORT

SOLUTION:

INFORMATION MANAGEMENT

PROCESS AND STRUCTURE

STRUCTURE

UTILIZATION

SYSTEMS

COLLECTION

NEEDS ASSESSMENT

ISSUES AND RECOMMENDATIONS:

INFO GAP 5: APPOINT A PRESIDEN1IAL 4' TASK FORCE TO SELECT GOVERMENT- DE

CRITICAL SUCCESStACTORS. DESIGNATE

DEPARTMENTAL/AGENCY INFORMATION FLOW

MANAGERS.

INFO GAP 4: -EXPAND THE USE OF

OOP. COMPUTER MATCHING TECHNIQUES TO

ALL DEPARTMENTS AND AGENCIES,

INFO GAP 3: COORDINATE ADP-SYSTEMS

/OP'

ACQUISITION AND ENHANCEMENT WITH

RESPECT TO TOTAL GOVERNMENT NEEDS,

IMPLEMENT SOFTWARE CLEARING HOUSE,

INFO GAP 2: ESTABLISH REPORTING

1110 STANDARDS TO INSURE ACCURACY,

TIMELiNESS, COMPLETENESS, UNIFORMITY,

INFO GAP 1: CONDUCT AN INFORMAION

NEEDS ASSESSMENT OF EACH DEPARTMENT

AND AGENCY, SELECT 4-6 CRITICAL 33

SUCCESS FACTORS,
IE. ISSUE AND RECOMMENDATION

SUMMARIES

4

34
II. ISSUE AND RECOMMENDATION SUMMARIES

A. PROCESS

INFO GAP 1: INFORMATION NEEDS ASSESSMENT

Issue and Savings,

Can the process of information needs assessment -- the

determination of the right information needed -- assist in

improving information management in the Federal Government? In the context of this issue, the "right ihforma=

tion" needed is defined as-the.most critical information

required for successful management of an organization. In

this issue, the Project Team addresses the question of how

to decide what information is most critical for different

departments and agencies based on similar 'private sector

sdccess ca s:_

74W

RecommehdatiOns in the PPSS task force reports to

correct the information Rap problems related to this issue

provide opportunitites for three -year savings and revenue

of $22.8 billion ($17.4 billion m information nformation gaps cited

in other issues in this Repott are netted out).

Background

Information needs assessment is the first step in the

Information Management Process and involves identifying the

information that will ultimately be'needed for effective.

decision-making. This step lays the foundation for subsequent steps ln the Information Management Process.

The private sector has long grappled with the problems

of poor information needs assessment. There are few private

managers,who, at onetime or another, have not experienced

information explosion -- too much information that leads to

spending.an inordinate amount of time sorting out the

critical information from the not-so-critical. .After

sorting through the reams of information reports,' managers

often discover much of the information available to them is

incomplete and irrelevant for the purpose of management decision-making. Other problems confronting managers include

an overemphasis on hard versus soft information, and vice

versa. There is often an overreliance on internally versuE

. . 15
/

externally generated information. Internally generated

information can be useful to monitor thefperformance.of

current operations; yet it' is important not to ignore

external information sources when formulating future

strategies and tactics, And the deployment'of organizational resources.

Because of these-and-other problems-stemming_from_an

inadOdate information needs identification,-.increasing . attention-has-been devoted to assessing the critical information-need's of organizations. Private companies have

instituted both formal and informal systems that.facilitate the inforra6tion needa assessment process. Much atten-=

tion has been dIvoted.-to the area in business and management information literature."

The depth, breadth and scope of Federal Government

-operations argue that problems relating to information

needs identification are likely to reside with Federal

organizations as well as with private sector organizations. Thus, it would.seem worthwhile to conduct a search

for and analysis of information problems confronting

Federal organizations which stem from a poor identification

A critical information needs. ". Methodology

In analyzing the process of information needs assess

merit and its application in the Federal Government, the

following sources were utilized:

o review of the PPSS task foice Apeports and

selected issue reports of whic 23 contain

information gaps relevant' to this issue;

o review of selected"general business

periodicals and publications; and

discussion with PPSS task force members.

Findings

When President Reagan asked Mr. J. Peter Grace,

Chairman and Chief Exetutive Officer of W.R. Grace and Co.,

to serve as the Chairman of the Executive Committee of

PP-SS, he directed Mr. Grace to search out waste and inefficiency in the. Executive Branch of the Government and to

recciAend ways in which modern business practices could be

put to work to make GovernMent more efficient and effec16 36
tive. He asked Mr. Grace to come into the various departments and agencies /end look at them as if considering a

merger or takeover

In priparing the acquisition analysis, the Project

Team found that the'real acquisition story is not what the

Goveynment knows about itself-and needs to improve, but

. rather what basic information it does not have which prohibits it from efficiently impr&ing its operations. The

following areas were considered in preparing the acquisition

analysis of the Government: s,

o financial and accounting data;

financial reporting systems and accounting

procedures and controls;-

o organization -- industrial relations;

o marketing -- producti; and

o manufacturing -- distribution.

As the PPSS task forces moved into the departments and

agencies to conduct the analysis the President requested,

it quitkly became clear that the basic-information needed

to consider the Government as a merger or acquisition can-

., didate is not available. Key information regarding Government services, personnelvfacilittes, equipment, performance and costs is simply not obtainable, or when obtained,

is frequently out of date, inaccurate or incomplete. The

availability of such-key information is fundamental_to the

successful assessment of the performance, health and

operation of any organization. Without such information,

decision-making is relegated to guesswork.

The following examples highlight the kinds of

deficiencies the private, sector executives found when they

tried to acquire the necessary information for purposes of

evaluating the acquisition decision. The facts- are drawn

from PPSS Reports released as.of November 8, 1983, and'they

demonstrate the pervasive nature of the information gap

problems in the Federal Government.

1. Financial and Accounting Data

o- The Department of Justice has insufficient

information to effectively carry out its mission

of collecting the Federal Government's accounts

receivables (JUSTICE 1).

3
o In the Department of Defense (DOD), data systems.

on $40 billion worth of inventories for the

military services are not compatible (OSD 2).

o

. . . The General. Services Administration (GSA) lacks

internally generated, reliable management

information on fixed assets such as buildings and

land -(-P-ROP 1)

2. Financial Reporting Systems and Accounting Procedures

and Control

o Poor interna controls at the Social Security -

Administrati (SSA) have led the SSA's suspense

file of any w ge item which cannot be posted to

an individual s account to increase to about 138

million items valued at $89 billion (HHS-SSA 3).

o The .Air Force Logistics Command (AFLC) utilizes

104 archaic and costly computer systems that do

not provide up-to-date accurate information to

manage .a $24.5 billion inventory (USAF 13).

o The GSA's budget planning is based on very crude

et-tiittat-e-t-and-Uh-dars-that reflect-private-sector

data rather than Government experience (CONST 23).

3. Organization -- Industrial Relations

o Agencies do not use a comprehensive, standard

definition for employee benefits and consequently

generally understate personnel costs in program

cost analyses (PER-FURTHER STUDY 2).

4. Marketing -- Productso The Pension Benefit Guaranty Cormration, which

operates one of the Federal Government's 92,8

entitlement programs, is.unable to publish`

\, .verifiable financial statements (BANK"4).

o Most National Park Service (NPS) area offices

estimate fee collectionocosts,,but the NPS cannot

deVise a rational system of user fees since there

is no separate accounting code for collection'

costs (USER 4)..

, ....... 18

t
5.'; :Manufacturing Distribution

-1

While $4.6 billion was-spent by Executive

agencies- on freight eransportation,_management

information systems itannot consolidate

GovernMent-wide shipping data, hampering the

Government in its negotiation of freight

--discounts with carriers (TTM- 3).

These selected examples are drawn from a more extensive acquisition analysis which appears 'n its entirety in

Exhibit II-1 at the end of this issue. More detaiic:

discussions of the information gaps listed in Exhibit II-1

can be found'in the'Appendix to this Report.) These examples are listed to illustrate the existence and pervasiveness of information gaps in 'the Federal Government.

r

An excessive amount of information is produced by some

departments and agencies( which seems -to be of little value

or use to Government decision makers. In fact, this . proliferation of information tends to impede rather than

facilitate the management information process. For

example, AFLC's obsolete and costly ADP systems number-104

and do not provide-up-to-date-or-accurate-infOrmation, yet

theygenerate some 50 tons of paper' each month. at each of

the AF-LC-'-g-five air logidTTUa-centers -500,000 pounds of

pape'r each month or six million'pounds per yeat (USAF 13).

For each of the past 17 years, dSA has convected paper

and computer tapes detailing the properties owned-`and

leased by ..Federal agencies into a series of bulky volumes..

The annual report is a 2,000- to 3,000-page doCument that

is undsable by federal decision maker's because the individual data points about any onepropeity aro.not inter

grate6.1/

The Farmers HoMe Administration's (FmHA) Approximately'

2,300 state, district and county offices report. monthly,

quarterly and semiannual data that are used to develop

management inforMation in thopareas.of program support and

administration. In addition, FmHA's Finance Office issues

about 125 management-type reports generated from its

accounting and data processing functions. Despite this

proliferation of management information, it is extremely

difficult to obtain information on the condition of FmHA's

1/ "GSA Gathers Volumes of Data on Federal Property

Holdings: Answers to Unasked QuestiOns," Myron

Struck,,The Washington Post, May 280, 1983, E10..

19
loan portfolio and boupwers, and to effectively and

efficienOly, managd.therporttolio and the agency (AG 2).

4.4,411,1=. The private sector has foCused its attention on

%1-4Znformation overload' since tbe early years of the computer wolution: Many managers have experienced information

iyitems-that produce an exikessive amount of information

only to discover that very little of the information is

useful in the performanCe oftkeir jobs.- In 'Management

Information Crisis,' D. Ronald Daniel analyzes the

_ information needs of managers and concludes that "a

company's information system must be discriminating and

selective. It should focus on 'success factors.' In most

'indusghries there am usually three to six factors that

determine success :. -these key factors must btidone exceed -

;kingly well-for a company to be successful.".i/

'Therefore, 'critical success factors' are the limited

er of areas in which:

9 -

- -.6 siMIti-sfadtory results will ensure successful

performance,

Pall must go well to succeed, . *

*. -0 '--__constant-and-carbfu-l-management-attessential, and

the current status should be continually measured

v, ans1,4reported.

Critical success factors focus on the needs of

individual managers and..take into consideration, the fact

that information needs vary both from manager to' manager and across Ein Critical success factors support organizatial goa l. and assist .in focusing management

attentian on specific areas. The following table:shows

critical success factors as they link to organizational

goals in two for-profit organizations and a nonprofit

organimition.

(Table II-1 on following page]

2/ see D. Ronald Daniel, 'Management Information Crisis,"

-4arvard Business Review, September-October 1961, p.

116.

40

6
Table fl-f *t POSSIBLE INNSTRY GOALS AND'CRITICACSUCCESS FACTORS 3/

,Profit status

jCt-profit

'Concern.

Goals

o earnings per shaee

o Return-on.inVesiirteni

o Market share,

o New prodUct success.',

, Critical Success Factors

Automotive Industry'

o' Styling

o Quality.dealer system

o Costconteol

o .Meeting energy standards

Supermarket Industry

o Product mix

o Inventory

o, Sales promotion

o Price

'Nonprofit

Concern

o EXcelle nce of health

-dare

o Meeting needs of

future health care

environment

9

Government Hospital'

o Regional integration

'of health care with

other hospitals

o Efficient use of scarce

Medical esdurces

o Improved cost accounting

See John F.;Rockart, "Chief ExecutivesDefine Their.

Own Data Need's, " .Harvard Businews-g Review, MArch7April

l979,_ p. 86.

=.1

A
Important exter'nal infarmation.is not monitored

particularly as it relates to environmental tS2101.1...M12211-

ditions

nit,itidrAs a ,regdat, 'poorsaremTade ToriCeTning

the direction of, program activi)(ties and the deployMent of

organizational resources. For examplp, when. Malang cast

projections on major weapons systqms,kthe Army.cOmMonly

fails to adjust,costs to'economic influences such

g

as.iflation. As a result, the Army is 'recordin,unrgalistio

estimations of prOgram costs, leading to incorrect con,clu-

.sions regarding cost overruns and cost growth (ARMY 10).

Addltional examples ofthe'lack of enyirontlient41,

monitoring and its consequences are listed belay':

. , The yeteransAdministrStion IVA) ConsteVtion

Program fails to take.. into account eo ra hictr:ends among the veteran population tesu tang in

ITY717Tanned locations and sizes;OLVA hospitals

H(HOsP 5).

. - . o. The Department of Agriculture failt to take into

account demographic changes -- age,.sex and

family size -- when determining tobd Stamp

benefit:allotments. ASa result, benefits are

distribUted well beyond stated requirements-

(AG.9).

o DOD's scanning of technalpgicaldtyq:10,2110ts_ is

not well coordnatedWittleDepat7tiffanTe i .weapons acquisition process. In fact; opera-.

tianal forces lack some understanding Of the

potential value. And-limitations of emerging

technologies before DOD managers. commit SPecific

technologies to weapons. systems ptagtams. As a

result, engineering development As not cost

effective (OSD 19).

The efforts and information re uirements of Government

organizations are Often._aimed at gettinc4the19..bdoleeileatively, without due consideration to gettingtyz12pA9ze

efficiently. Considerable` time and-effort, is committed to

,what is to be done,but rarely is a comprehensive post audit

-conducted. In the private sector, post audit f&-lowuP is

considered ta be a critical element in assessing the success_

or failure of a, project.. This goal orientation is Particularly evident as it relates to Government grant diS-tributionnwhere the emphasis isrcommonly placed On:getting the

grants out guickly,.rather than getting the grants out

. accurately and efficiently, as well as managing ottir

22 42
r'

elated fUnctions.* The Urban Mass Transportation Administration (UMTA) provides financial assistance to municipalities and transit authorities throughout the U.S., chiefly,

through grants. UMTA, lacks accurate, Complete, and current

intormationtar processing an&monitOringArant applications, for accounting for apportionments, obligations, and

disbursements, And for developing budgetary andother

reports to the Congress (TRANS 3). A:siMilar-problem arises

with check. disburseme'nts) For example, of the 28,000

pension c6eCkS distributed monthly -by the' Pension 'Benefit"

Guaranty Corporation,.'only 18,00`0 are verified as correct.

The remaining 10,000 are estimated, and no one k4ovis whether

they are accurate (RANK 4).

In the Economic-Demelopment. Administration (EDA),

officials concede that EDA's emphasis has been on granting

new loans to business rather than collecting on old ones.

EDA.has loans and loan guaranties totaling over $1 billion

(COMMERCE 5). In the Department of Education, thebasic

ledger system focuses on disbursement data and does not

Perform the usual primate sector function Of controlling

assets and liabilities. Thus, the Department could not

accurately monitor accounts receivables' and outstanding

obligations even if it wanted to..(aD 2).

. . Federal- Government department and agency manager's do

not analyze daily operating positions on an ongoing basis.

This practice inhibits informed and effective decision-making because essential information (.such as employee or

program performance data, inventory levels and cash balances) is'not available. This intormation gap needlessly

increases Gove'xnment operating cOsts,:resulting in greater

tax burdens. The PPSS Federal Management Systems Task.

Force found a'generaLfailure to identify management

objectives and related financial information reqUirements

at the central government and department and agency

levels. In, fact, the task forceconcluded that,many key .

management decision makers lack an understanding of how to

use financial information to-monitbr and direct their

operation's. Specific examples include:

o The Department of Interior's cash management

iysteM is so inadequate that it often takes' more

than two weeks tb-col/ect, record and deposit . payments. Comparable private sector processing

is usually accoMplished in one or two days. As a

result of the time lag (a period during which the

! cash position is unknown), the Treasury does not

have'use of the'funds and must bdrrow to fulfill.

short-term cash needs, incurring interest

expenses (INTERIOR''9).

2-3
Agenty and department accounting systems have not been developed to provide-cash management account- ing processes or cash flowfoteCasting capabili-. ties. Cash Management has taken,place in an after-the-fact recording of data used primarily fortherneXt year's budget allocations. As a result, critical financial data are not available on an ongoing basis (ASSET. 8).

o Reliable information on the work force require- ments of Federal agencies,is not:.aVailable, resulting in the absence of a uniform work force

planning system and a lack of budgetary input

into the planning. system (PER 18).

The Government does, not have a management hgenda, such

as a <- .strategic plan or basic operating objectives. The closest document the FedeeaI Government has to a central

management agenda is the short-term, one-year budget which forces little analysis and almost no long7range planning.

The first step in.the budget process is the formula- tion of the President's budget, which begins 19-Months

before the fiscal year in question is to begin. Once ..the President's budget is submitted in January, the Congress ., has nine months to approve a.final boidget'or operate the Governmedt on a 'temporary appropriation basis. ,To keep the. budget on schedule, a series of action deadlines exist for a variety of Congressional subcommittees as set under the Congressional qudget Act of 1974 ""en with these dead-. lines and the detailed procedure:_ the Government has begun the fiscal'year without a budget the. last several years.-

Even when a budget is in place, it does not provide a management agenda against which performance analysiS or long-range planning can be conducted. One of the reasons for this AnalSis gap is that the.bUdget'does not report, all of the Governme'nt's obligations. The PPSS''Management Office Selected Issue Report on Federal Government

Financial ManageMent estimates, that the offickal budget captures only` 4,6.8 percent of total FY 1984 Federal gxpen- ditLres. Managing an organization with an instrument that captures less than one-half of all of its commitments is imr)ssible.

Goveinment Managers often 0;ersee operations that are- similar to operations performed in the private sector. Yet thexe is compelling evidence to suggest that,Government managers lack information on the generally accepted private sector practices pertaining. to their operations. This often contributes to. Government 'opeeations,being run in a less

:.24 44
efficient and effective manner than their private sector

counterparts. For example, travel procurement is decentralized and fragmented to the point that publicly available

travel information and rates are not regularly available. to

Government travel professionals in .atimely manner. As a

result, the Government does not maximize usage of special

travel rates or negotiate special volume discounts as the

private sector typically does (TTM 1).

GSA does not audit freight Charges prior to payment, as

is standard in the private. sector. GSA audits freight

bills 18 months after payment. In fact, GSA does not'mow

the total-freight Charges represented by the bills it

receives for audit nor, the total freight charges on the

bills on which overcharges are identified (TTM 4).

A sample listing:of other private sector standards

that are applicable but not utilized in Federal operations

include:

Inadequate data are prepared to monitor the

costs, quality, level of subsidization, or the

average yield of the Government portfolios

(ASSET 23). 1 Copying and dupliCation equipment, volume of

copies, and expenses inquired are unknown,

leading to uneconomic acquisition and unmanaged.

utilization (PPAV 6).

o Informati does not exist on total Federal poStacr ' expehses, and 'Information on

ma. g procedures is not widely disseminated to

Government offices. As a result, some Government

mailings are shipped at higher classifications

than necessary in uneconomical packages without

_using bulk mail discounts (PPAV 4).

Conclusions

.The acquisition analysis presented in the first finding

of this issue demonstrates that the basic information

necessary to make a buy/no buy decision on the Fedeial

Government is rot available or, when it is available, is

untimely, curate or incomplete.., Pa zicularly disturbing to oject Team is that so little critical infor-,

:nation on financial position, organizational strengths,

proetiict management .and,manufacturing is available that the

Government would be Unmanageable if it were acquired. PPSS

would not acquire the Government.

25
Information problems relating to poor -information needs identification pervade the Federal Government. Excessive information is produced and is often irrelevant to the true information needs of Federal managers. It tends to impede rather than facilitate management decision-making. There is also a lack of collection of external ihformation such as a failure to monitor environmental trends and conditions Much of the dat'a collected is budget-driven, leavfng operat-- ing managers without a management agenda. Furthese informa- tion collected commonly reflects an unbalanced. goal orien- tation among Pederal operators to get the- fob done, rather than cost - effectively.

The results of these problemslare clear. Government decision makers commonly lack the critical informaition

necessary to effectively monitor the performance of current operations, to effectivelylormulate.future-oriented and to effectively deploy organizational resources.

To improve management efficiency and bring cost Under control major improvements must be made in infotmation

collection and reporting.. Such iMprovements will not be

easy. The pervasivenesS of the problem demands an imme- diate and thorough organization-by-organi-zation review of the critical'inforMation that is needed to effectively

manage each organization.

'Recommendations

INFO GAP 1-1: The Office of Management and Budget or the probosed Office of Federal Management should establish an Information Needs Assessment Process via the Critical. Success Factor technique for use by Federal Government

managers., This Information Needs Assessment Proces$ should contain7five specific steps:

1. Assess current and emerging, influences.

Assess current positibn of the department or

agency.

3.. Formulate organizational goals.

, 4. Establish critical success factors.

5. Determine repo,rtihg requirements.

These five steps are outlined in Table-II-2, which appears on'the following page.

[Table II-2 on following page)

26 46 .
Assessi

airrent

And kherging

lnf luences

F

IlEnvironmental Segments

Potentially Affecting

the Organization

Technological

Social

'Political Regulatory

Economic' Natural Manpower

Consumer

- Gcoirdviiic

- Utwiraphic

Constituent Eveadtions

Internal o' External I Mural Conditions

Table II-2

INFORM/MN WEIS ASSESSMIN VIA DE unfelt', SU:CMS FACIOR 1111INIQUE

Imeissoe

Assess

Current

Organization

Position

OMOOSOIO

"Organization Mission

\ progrea and Strategies

CUrrently in Place to

Fulfill Mission,

I Program and Strategic

inputs

Budget $ Amounts

Personnel a Material

Management

Attention9

Formulate

Organizational Goals

0 , "Effectiveness

Or "Efficiency

Orientation

liGiial Categories

Growth/

Contraction

Stability

Flexibility

Adaptability

lnnovativeness

01101011010011

Ill spoosivenesti to Constituencies

- Inter

- External

IP

tloplizatiorial,,_

A014,41rvPlions

'about thelnildnd Personnel

I Cost 'Control

141xXxiMeIV1C0

1kgelopilit

Establish. Critical Sttcess

Factors (CSF)

00.00001106

617 categories "wat

Cverational kformance Monitoring

Future Pinning , Measures

EXception Reports

Summaries

Year-to-Date Midget o

1 Indicators ndicators

Dips

- Ghjective (Hard) '4

- Subjective (Soft) Sources

- Internal

- External 1- Possible (F Areas

High Priority ' - General Accounting

- Hudgiting

Median Priority

Dishurserent

- . Procureiknt- 0 IA* Priority

104x)r Use ltaining/fAucatiun

ilHow

Statistical Tables/

Charts',

..Graphic Displays Verbal Communication

Standardization

(e.g., CRAP) when lit on

Level I

Level 2 s Level l

48
I, As shown in Table 11-2 on the previous page, the Information Needs Assessment Process contains five steps,. The five steps are discussed below.

Step 1. Assess Current and .Emerging Influences

The first step in the Information Needltssessment

'Process involves an assessment of current an emerging ,influences potentially affecting the organization. Such influences include trends and conditions relating to the various environmental segments: technological, social, political, regulatory, economic, natural, manpower and consumer (geographies and demogeaphics). Other influences would relate to what is referred to as "constituent expee- tations," both internal and external. An example of an internal constituent would be the organization's personnel, . whose concerps would relate to reward, recognition, job satisfaction and enrichment, career pathing, security. and. advancement. External constituents would include:sup- pliers, the media, interest groUpsiother Government officials and departments, people whom the organization may serve, and society-at-large. Finally, the existence of any special conditions relating to a particular period of time -- temporal conditions -- should also be assessed.

Step 2. Assess Current Position of the Department or Agenio.

The essence of this step is the determinatio ,.Jf hod well the organization is .positionc' relative W. the current and emerging influences identified.in Step 1:- To make this determination, a thbrough, understanding of'the organization and its background is necessary. The organizations mission as well as programs, activities and strategies currently in place to,fulfill the mission should be identified and assessed relative to the current and emerging influences

identified in Step'1. If no longer appropriate, given the changing influences, organizational changes may prove

necessary. Finally:, there needs' to be an identification and assessment of how cursept resources are deployed (e.g., budget dollar, amounts, persbnnel, material, management, attention).

Step 3. Formulate Organizational Goals

- Information needs should be integrally tied toorgani- zational goals and objectives. Goals signify the end points an oeganization seeks to achieve. Such goals should,.where desirable, have an "efficiency" as well as an "effectiveness". orientation. Potential categories of orga28

49
nizational goals include: growth, contraction, stability,

flexibility, adaptability, innovativeness, ,responsivene

to constituencies' (internal, and external), organizational

image, personnel, cost control, product/service develbp-

:_mentt and .productivity.

Stpp"4. Establish Criiical Success Factors

This next step involves determining the critic Ome of success factors (CSFs) necessary to ensure Attlo

the goals established in Step 3.. To avoid masiVe.

information overflow, the selection of success' factors

should be discriminating and selective. All factors which

might possibly Affect the organization are not important.

Only the most critical success factors should be determined.

CSF d termination is an important step, in that an

organizati n'sAmforMation requiremmAA should emerge from

this step. For example, this step shlbld make apparent

what typ of inform ion (objective Ana subjective) and

what -so rtes of -info 4Rion (internal and external) will be

-needed o eftectivelY monitoroper,LLional -Prformance as

well a to facilitat FutureplanitrT e fClowing list is a sample,q4estionnaire for

'"'determi ng an organization's CSFs: 2/

o What types of decisionS are you regularly called

upon to make?

- -

.o What types of information do you need ,to make

these decisions?

o What' types of information do you regularly get?

o What types of special studies do you periodically

request?

o What types of information would you rik'e to get

that you are not now getting?

o What information would you want daily? Weekly?,

Monthly? Yearly,?

Philip Kotler, Marketing ManageTent (New Jersey:

Prentice-Hall, 1980), p. 606.
o On what. specific topics would you like to be kept

informed?

o What types of data analysis programs would you

like to see made available?

# In determining CSFs, a variety of possible items might

be targeted for collection. Since each agency has a

different mission, each agency"will need to select the CSFs

of greatest importance to its mission. The PPSS Federal

Management Systems Report concluded that developing information about the following areas would be highly productive. These functional areas are offered as a point of

departure for the Informatiob Needs Assessment Process..

to High Priority:

o ACcounis Receivable'

o Accounts Payable

o Fixed Assets . o Cash Management

_Medium Priority:

o DiSbursement

o .Procurement

o Inventory Control

fi-

'Low Priority:

o Labor Use

o Training/Education

Step 5. .Determine Reporting Requirements

The last'and final step in the InfOrmation Needs

Assessment Process involves determining the information

rep rting requirements,. Reporting requirements serve to

fu r;Oefine the'information needed, as well as the form,

fo a-rid timedn which the information is to be presented. Report summaries, year-to-date budget comparisons,

key indicators, and,exceOtion reports' are but a few.of the --

kinds of information repints a manager might' need. THe

format of these reports is,important to promote ease of

understanding. Format alt4'rnatives-include statistical

tables/charts and graphic displays.` CoMmunication alternatives involve a choice between written and oral formats.

Either way, standards shouldbe established and',adhered to.

A

30
Information is further defined by determining who

(which management level) needs what information; Different

management levels will likely need and seek different types

of information (i.e., operating:versus top management

INFO GAP 1 -2: Each department and agency should

conduct an organization -by- organization information needs

assessment.

INFO GAP 1-3: Implement the Information Needs

Assessment Process by utilizing private sector standards

And tailoring their standards for the Federal Government's

management needs.

Savings'and Impact Analysis

The cost savings, revenue and cash accelerations for

this issue, -Information Needs Assessment, acre listed in

Table 11-3, butthe dollar amounts reported are duplicative of savings reportedre-VIOusly by PPSS and are pre-,

_sented here .only- to.-pro ide_theT_t_eader_with a perspective

of the scope and significance of the information gap

ptoblem.

In reporting cost sa.vings and revenues, the Project

Team has given each liiformation gap a primary issue assignment, although many.of the information gaps are more complex

than anyone problem.area. Therefore, when an item is

duplicated within'the Report, it is netted out so ,that the

dollar amount fot any single information -gap is counted

only. in its primary areat,

The information gaps and their related dollar amounts

are reported over three years: The table that follows

consists of three parts: 'two detailed parts, 'Section, I and

Section II, and a consolidated totals part, the Summary, -as

described below:

Sectioh I: information gaps specifically

addressed in the text of this-istue.

o' Section II: information .gaps that are, not specifically addressed in the text of this issue, bust

that the project Team finds relevant.to this

issay.

Summary: consolidated totals from SeCtions I

and II.
4

Detailed discUssion of these information gaps appears in

this

volume.

_......._...........____ ..._... .... Tmp1. eliieiiiatliii4- --, All of the recommendations in this issut INFO GAP 1

can be implemented by an Executive Order of the President.

[Table II3 on the foiloWing pages]

32 53
'MILE 11-3: INIAmmATIUfl NEEDS ASsE.SsMLNT 1/

savings (S)/Hevenue (HI/Cashkccelerations (CA) 1/

Task Force

issue Number Topic

Year . 9212

($ millions)

Year

Two

Year Three

Three-Year

Total

5 .,' Sectiori I: lnfOrmation Gaps Contained In This issue

a.; 2

u';,9 !Stir 13 a4MY-10

Farmers Home Administration'

ManageMent information

Thrifty Food Plan'

ADP Modernization j

Mop( Weapon Systems Acquisition -

$ 178.0

18.5

1,039.0

172.6

287.5

$ -20.3

1,142.9

194.3

632.7

$

22.3

1;257.2

113.7

1,043.6

0

$ 1711.0 (CA)

61.1 (S)

3,439.1 (S)

580.6 (S)

1163.8 (S)

SANK 4 Pension Benefit Guaranty Corporation 40.0).A 44.W,- 48.4 132.4 (It)

3uMMEAcE4..5 .Economic Development 5.0 5.0 /5.0 15.0 (CA)

'.Administration Debt Collection 0.5 1.0

i / 1.8 3.3 (S)

JSU 19 ULID Laboratories 233.1 513.6 i 847.0 .1,593.7 (S)

Y al) 2. Mandqement.IntormutioniSystems 145.0 294.5 .,,, -324.0 763.5 (S)

4,

HuSP 5' VA HoSpital Construction Program '16.0 323.6 393.7 733.3 (5) , ASSET U sql3sh 'Management Incentive's

-f

,_ 2/ ASSET .21 -: Guaranteed Goverimient 6:tiding if

INTEHIUN 9 tash,Managemer4 Improvements 38.0 81.0 100.9 219.9 (tA)

a

0 1 3.8 8.4 . 11.1

1 23.3 (CA)

pEkt-it : . Worktorce-illanniwy ,__1_2/

PPAV 4 Mail Management ibb.0 181.6 200.9 549.5 (SI

PPAV p: Copyin9 and Duplication Services 99.0 108.9 119.8 327.7 (5)
'Max 11: I JhRimMATIuti esgt.sstakir lcutcu) 1/

TaSk, Force.

'issue WAX(

.1114 1

Topic

Savings (s)/Ilevenue (R1/0sh Accelerations (CAL' 1/

. 1$ imillIOns) Year Year : Year'

one- Three - Section I: 'Information Caps contained In This.ssue (Cont'd)

Federal Travel procurement

TIM 4 Transportation:Audit

'Total Section I Sayings1S1 Total SEctian 1,1(6renue-110 # Grand Total Seciion tisigirigs,and Hevenile

Total Seaton I Cash Acceleration (CA)

Three-Yepr

'Vital $ 297.3 $ 327.0 $ , 359.7 984.0 (S)

49.9 54.9 . ; 60.4 165.2 (S)

$ 2,524.4 $ 1,796.1- $ 4,844.1 $ 11,164.8 (S)

40.0 44.0 48.4 .-- 132.4 (11)

4 1064.A $ 112.2 $ 4 A2141 $ 11A2222

-$ 224.8 $ 94.4 $ 117.0' 436.2 (CA)

°, Section 11: Ihturmatton Gaps Kelevant To This Issue

Ad 13, POteign and Vuinesti'croinmunity.

Programs - Credit Evaluation

.yractideS % USAF 211 uual Souiccilig

ARMY 1 Personnel ganagement

ARMY 9 ' Personnel-- Le4rninglilesource

Centers -;.- AuP 4

oS0.39 ti

(INST.' 21

OJI4ST 2!'

FEEDING 1

Hardware and Software iteL'ources

Management . ArmVAIN

Financial Issues -

Government-Furni.Shed Mae'rials

Construction Project. and Progiam

Management

Eite-Cycle Cust..ing

Po 1 I Cy and M.iruyrutirnt hitormution

for Feder.al'FvediOq.

341.9

30.0

111;2

a.

,. . $

. 736.2 $ 1,344.0 $ 4422.1 (S)

.66.0 93.5 189.5'(S)

b 11.2' 12.3 . 33:7 (Si

.. 533.2 1,281.8, 2,214.8 4,029.8 (S)

. 250.0 '215.0 IT 3/2.514' 827.5 1g1

40.Q 44.0 .48.4 132.4 1S1

50.4 55.0 181.5 286.5 ,(S)

. r- r 2/
THAI NEWS As.t...51.141(1' lautrrol II

Savings 61/RevenueAM1/Cash Amtelerations (CA) 1/

Topic

Section 11: Information Ga

You

une

_. . 7. . 4 14 millions)

..., i Year Year

lloo Three

s Relevant To This Issue ICOntedi

. . *red.-Year

Total'

HUSP 6. HOW, 11

HUU 2

LABGH1

Orginiution Uecision-MaiOng

in VA Hospitals

Medical Gate Cost Recoveri ernis

Insured lnactjve Military Benefi-.

:ciaries

'Organization Und Administration

Reducing Unaiithorized Te4ephone Usage

PER 14 Training andDevelopment Services

p0pc 19 ..Contract Performance

PROP .1 ,Aianagemeni Focus and Technique

PROP'.2 Office -Shire UtilizatiOn GhalS

6 . PROP 7- Energy Cysts in Gover

Controlled Buildings

Ria) 6 , Research Program Reporting

TRANS 5 AUP:Operations

USE 4 National Park Service

$ 360.6 $ 403.3 $ 439.5 $ 1,21114-(

USER B

USER 17

.PPAV 1

USDA Forest Service Firewood

Program:

Fre iln of -2 Int ()cilia ion

Pohl 'cation Miru:iement o

111.

1.0

28.4

1:1 20.0 22.0

10.0 27.0

18.7 20.6 ''' 34.3 ' 75.5: (75.5) 219.4

(4.U) 71.0

12.4 15.6

3U.0 33.0

19.2 21.1

`70.a 77.0

1011.0

5,3

31.2 69:6 (5)

1.2 3.3 (S)

.. - 24.2 66.2 (S).

60.0 97.0 (Si

22.6 61.9 (S)

124.6 234.4 (5),

241.2. 385.1 (S)

158.5 225.5 (S)

ASA 4674-(-5-3-

36.3 99.3 (R)

23.3 63.6 (0)

04.7

121.o 231.7 (H)

331'0
Task Force

ilsSue !Amber.

AilLtt 11-3: 1111-14114AItli 111-.EDS ASSESSMENT 1cuurrib3. 1/

f.

Year ." Year .. Year- ThreerYear. TOpie One No Thiee ' Total" %

.,....

.,. Section 11:. lotorMation Gaps Relevant Tu This Issue (Cvnt'd)

-1- PPAV 2' 1Jublication User Fees PPAV S Printing ProduCtion

Total Section 11 Savings (S) : Total Section II Heyenue (N)

..

. Grand Tota"Section 11 Savings and Revenue

Memo: Total Section 11 cash Acceleration (CA)

$ 80:0

48.0

d 8&U

52.8

$ 968-

- 58.1

264,0 (R)

158.9 IS)

- . 4.1,430.2 $ 3,112,6' $ 5,058.0 $ 9,600.8 (S)

567.8 622.4 680.6 1,870.8(R)

$ 1 d2160 $ /....7 5.2 $ 5;7384 $11i471a

$ $ $ - ACA)

. suMmary: Consolidated Section 1 and Section 11 Totals

Taal Section 1 and 11 sayings (S) $ 3,954.6 4 6,908.9 $ 9,9024 -, $:20,765.6 (S) TOtal Section 1 and11 Revenue (H) ' 607.8 666.4 729.0 ' 2,003.2 (R)

. .,- Total Savings and Revenue in'Issue $.14kthil $ 7.575.3 $ 10.631.1 $ 22.760.-4

Less Duplicated Savings 3/ $ 1,106.9 $ 1,614.6 $ 2,,179.8 4,901.3 Less Duplicated Revenue 3/ 139.2 153.1 i 168.5 460.8

Net Unduplicated Savings and Revenue e $ lilt& $ Ilati.7:1 $ 8.282.8 $ ;7:406.7

Memo: Total t.sh Acceleration (CA)

Less Duplicated Cash Acceleration * 42" $ r4.4: $ 1174 t ''' :336. $ 224.8 $

Net Unduplicallid Cash Acceleration $

$ '.$

,....$ -

1/ Amounts 111 thiS TaUle.rjpresent duplicate cost savings,' revenue and c.ish.acceleration for PPSS, as these dollar

amounts were ,previously reported in PPSS (uplifts as. of Novuotit.T 6,. 1983. ileSe ambonts ifichide intlation:and ace netnt amplementatioh cost.

e/ Not! quantitted.

1/ These amounts are claimed n. another issue within the InforhutionCapHeport and are netted out in this issue.

All,dollar amounts in the, 11114rPution Cap Repott duplicate savings'previuusly reported by PPSS. -tr!'

.
: AN ACQUISITION ASSESSMENT

When.President Hetgail Asked-lir. J. Peter Gfacee_ChairmarCrif the EitiOutive Committee of PPSS

and ehaiTman and Chief Execative Officer of W. K. Graced Co., to search out waste and inefficiency

in the Executive Branch of the Government and to see how modern businesepracticeircould be put to

work to make the Government' more efficient and more effectivee he toldRe... Grace:

. . to come into the. various departments andAgencies'and look at tbelkaa if

you were considering a merger or.takeover.

As the 36 PPSS task forceswent about their work of agency and tunctional.reviewa, it soon

became apparent that key information regarding covernient services,, personnel, facilities, equipmerit, performance and co:ts is often not available; when available, it is frequently out - dated,

inaccurate or incomplete. 7hese information inadequacies make he concept of. lookingat the

Federal Government as a merger acquisition candidate imposs le, at the inform:1,0ton needed to

make a buy/no buy decision Js not available. In addition, it. ecame clear that critical information is missing not only to make an affirmative purchase decis on but also to run the Government

11 it is acquired." Withoist adequate information, the GoVernme t; ..just like any business, cannot

be well managed to assure efficient and effecttve operation.

To -answer the Prellident's regulate the Information Gap Report Team conducted a business

acquisitionanalysis of the following seven key functional areas:

o comSany backgrounds'

o "industry,analyaiS;

o financier and accounting dat i s ,

-,-, o financial reporting systems nd accounting

.. procedures and controli;

'0 organization c- industrial relations ;.

o marketing - products) and -

,:t.§4e,. o manufacturi* n.g distribution.

. -

.

, .

. This list is not exhaustiVe and some ftilletions not listed- such as paymentof taxes =-

would not.be applicable'to Government. However, the tiOdings that'follow demonstrate this

"information gap' problem, which is pervasive in the Federal Government. _While the following

pages fodds on performing an acquisition analysis, the lack of reliable information Seriously

impairs the management of the Government. A brief acquisition analysis 1/ follows'

1/ Specific information gaps are from PPSS task force reports and are referenced within

parentneses,i:e., "(USAF 22)' refer to-the PPSS U.S. Air Force Task Force Repoit, issue

number 22. A detailed. discussion of the information gap cln he,found in the Appendix to this

Report.

*P,

5 6

.o-
Company Background

any Name:

ti

Government of The Need States of. America

ctors: The Congress -- 535 directors

ide EXperis:

Auditors: The Government has no, innependepc

Sditors.

Consultants: Federal Procurement Data System

ca Ot identify how many consulting

service contracts the Federal Govern=

sent has, and at what cost (USAF 22).

f Description of. Business: With an FY 1903 operating

budget of approximately $050. billion, the Federal.

Government is the largest conglomerate in the United

States. It is the:

o largest employer;

o largest power producer;

o largest insurer, lender and borrower;

o largest hospital system operator;

o largest landowner and tenant;

o largest holder of grazing"land and timberland;

largest owner of-grain; and

o largest warehouse operator, shipowner and truck

fleet operator.

r Prpblems:

0 420. V A operating ideficit in FY 1903;

Ion debt; and

2.5ttrillion compensation plan and unfunded

pension liability.

9

2. Industry Analysis

, 5 f

Competition.: In recent decades, a large but jndefinite

number of services haveAmen produced' by the Govern7'

ment regardless of duplication with the private.

.sector. Examples include hospital management, load

stores (commIssarieh).and food service. This places

Government in the position of being a business without

the competition of the marketplace. Government-run:

operations:

o lackrthe driving forces of marketplace competition that promote 'operational efficiency in

profit-oriented organixatiOnal

o commonly lack the management information systems

that provide timely data necessary to arrive at

economically effectiliOdecisioni;

o, are constrained by regulated 'safeguards %

that inhibit a manager's freedom to manage, such as

Civil Service regulations governing personnel pa

and dismissal;

o are often driven by 'political' xonsiderations

rather than efficiency considerations; and

o sutter from decision-making that is far removed'

from an activity.

y

Industry Growth: The business of theFederal Government

has experienced rapid growth in -recent years,,reaching

a spending level of $605.2 biljion in FY 1983.

60
'inancial and Accounting Data

:ial Statements: The Federal Government does,not gene- :

:ally produce balance sheets, income statements or

aatements of, operations, statements of changeS in

:inancial position and cash flow, or interim financial

statements. While annual 'budgets are utilized, these

)udgets generally are projections based.on.the preriois'year's,budget with an extrapolation for

Int atiorr. at Business: Detailed information on the Pederal

loiternment's different activities or programs are

lifticult to obtain.'

its Receivables:

The Department of Justice'cannoi,effectively

carry out its mission of Collecting the Federal

Government's accounts receivables, as accounts

receivables are .1nconsistently defined throughout

the Pederal Government (JUSTICE 1).

The Veterans Admintstratidn's (VA) recovery rate,

for the,debt collection activity is low-because

accurate information,regarding the value and

statusvof the debt owed the VA is not available

(VA 3).

3 Similar examples pf accounts receivables manageMent problems can be found to SRA 2, ASSET 8 and

ASRET 9.

tories: 1 Inventory data systems for each of the military

services and the uefense Logistics Agency are not

compatible, leading to inadequate information and

suboptimal inventory'management decisions (USU 2).

o

, .

. The lack of inventory planning prevents purchase

performance monitoring or.identitication of

i0prOed pricing opportunities- within the VA and

the Dcpartment of uetense (DUD) (HUSF 9).

o Similar inventory management examples can be tound

in USAF 13, USD 39, NAVY 8 and NAVY 13. .

Fixed Assets:

o . Within the General Services Administration (CSA),,'

there is an absedce orinternally generated, .. reliable management information on space assignments; space utilization, vacancy rates and

rental rates for GSA-controlled apace (PROP 1).

o VA health facilities construction planning,

utilizes poor data an4"questionable assumptions,

resulting in wasteful construction projects

(HOSP 5).

o GSA does not know how many Government cafettcias

exist, what equipment is in the cafeterias, or

what equipment is owned by the contractor or the

Government AFEEDING 1).

o Similar types of problems in fixed assets are

discussed in CONST 21, CONST'23, JUSTICE 2, PROP

2 and LAND 2.

Liabilities:

o The Federal Government does not fund its retirement programs for its military or civilian per

sonnel as private companies are required to do by

law. The Federal Government's unfunded liability

for its military-and civilian pension, plans is

currently over $1 trillion.

o The Federal Government's liability far Social

Securi$y, Veterans,' and Federal Employees Compensation plans currently is an estimated $1.5

trillion. Including the'unfunded military and

civilian pension plans, the Federal Government's

liability totals $2.5 trillion.

o The Federal Government's-contingent liabilities

such as loan find credit guarantees (e.g., for

housing and rural development) and insurance in . forCe te.g., Federal Deposit Insurance Corp. and

Federal Savings and Loan Insurance Corp.)

currently total $2.6 trillion.

o In summary, U.S. Government pension, retirement'

and disability plan liabilities and contingent

liabilities currently total over $5 trillion.

61 62
icemint Cost Data: The Federal Government does not

maintain accounting data on a replacement cost basis.

is: GSA lease management is ineffective, as GSA

published data on leasing is not iimely and often is

inaccurate (PROP 8).

tors' Reports: Auditors' reports of the Federal Government and its operations do not exist.

r Accounting Polities: o The Federal Government has over 300 separate

accounting systems of which about only 60 percent.

have been approved by the General Accounting

Office. None of these systems follow Generally

Accepted Accounting Principle:: (GAAP) standards.

o The Federal Government maintains accounting

records on a cash basis, not on an accrual basis.)

:4 of Ability to Operate in an Inflationary Environment:

How does the Federal Government handle items such as

thoee listed below:

.vables: o The Department of Interior's IDOIrcash manage- ment system is inadequate due to poor accounting

control and delay in processing receipts in the various DOI bureaus and offices (INTERIOR 9).

o Similar accounts receivables.management problems

which may affect,the Federal Government's ability

to operate in an inflationary environment are

discussed in COMMERCE 5, ED 3, 'SBA 2, TREAS 1 and

VA 3.

Fixed Assets:

o GSA's lack of interest in cost tontrol has lato

the absence in the'National Capital Region of an,

Energy Management ControlSystem which would

monitouenergrneeds and output in order to provide efficient energy utilization (PROP 7).

Budgeting and Planning:, o Long-range strategic planning for the Federal

Government's overall ofEiCe automatioeneedsdoes

not occur, as there is no, organized system to . inventorynr account for the costs-or-henefite-----

and characteristics of office automated ertuipment.

(ADP 6). o Reliable information on the work force needs of

Federal agencies is not available, resulting in

.'the absence of a uniform work force planning

system and a lick of budgetary input,into the

planning system (PER lb).

40 o Other Wiles covering probleks regarding assuip7

tions used in long-range planning are HOSP 3,

HOSP 4,"'HOSP 5, HOSP 6 and PROP O.

64
inancial Reporting Systems andlAccounting Procedures

ntrol sent Reports: The Federal Government's agencies and

epartments publish numerous Ivy management reports:.

he yilue of many of these re#orts may be quesiioned

ue to the problem of obtaining accurate and timely

eta.

.

. types of reports helpful to management: The Federal

overnment does nok'prepare balance sheets, statements

f operations, staTements of changes, in financial posiion and cash flow, and interim financial statements.

al Controls:

I 4

Computer Facilitiesil

0*- o The Air, force Logistics Command'1:104 crieliniet - systems are archaic -and costly to-maintain and do

not provide up-t0clate accurate inform-aim% tot

inventory control-and-other.logistiCe4MMcLino

(USAF 13). o the Navy's antiquated computer equipment

factor. in. costly omissions and excessive initiatory losses in ple'Navy'S supply syStemlNaity 8)A

o Other examples ofcomputer facilities probleeS

ace discussed in &l* 6 and NOSP . The-EnVironmental Protection Agency lacks'an'

accurate and timely cost and financial information system needed for-efficient and effective

cost control (EPA 12).

The Social Security Administration cannot provide

timely, accurate data to its field offices

(HHS-SSA 3).

t. The Urban Mass Transportation Administration

lacks accurate, complete and current information

for processing and monitoring grant applications,

and for accounting and budgetary needs'which

result in grant. overpayments, lapsing of funds

and misappropriation of funds (TRANS 31.

Similar elamples of internal control problems are

discussed in BANK 4, OSD 39, SBA 2, ASSET 8,

ASSET 9,,AsSET 12, HHS-BCFA 6, NAVY 8 and NAVY 15.

Budgetary Planning:

o The GSA bases its budget reqUests on very crude

estimates and on data whiCh reflect private

sector dataL4ither than Goarnment experience,

(CONST 23).

o The cost index used by DOD to establish, the

feeding budget for the uniformed services in

_based ostmore_expensive food items .than actually',

consumed,in dining facilities; (FEEDING 5).

o Other budgetary planning problems are discimed

in FEEDING-1 and USER f.
organization -- Industrial Relations

lanagement Personnel: In the Federal Service;, the tern

'executive' generally describes any of the 11,000

positions paid at rates equal to.or greater than the rate tor a GS-16. There is,-a-ceiling for.executive

salaries at the rate of, Level V of the tlicutive':,

Schedule, which is .cuT4 $b3,800 per year.

Executive selafies mate. when compared to

those for comparable v C responsibility iiw the'

private sector, saki d Lou% for Zovernment'io

retain its most eXp rien, lalWrited executives. yee Benefits: Agencies use*naccurate information-as

the basis for determining personnel costs,and gendrilly understate the costs of 'employee benefits,1PER

- FURTHER STUDY 2).

Marketing -- Products

ct Lines: Over time, theyederal Governmen

j a,a e 4 11:11 ......2 7s becomeexceedingly complex is-it has bedome involved

in an ever-expadiiingaage of'activities. In aduit.ion to its central functions of,Iegulation and provision for the general welfarei'sakt4ind national defense,

the Government runs a humbel of businesses such.as

grocery :,stores (military commissaries), hospitals,

electriC,poWer' generation facilities, and banks, ,it

provideCits customers (constituents) with 928 entitle

Sent programs which'provide benefits to certakn'groups

regardlegp of budgetary limitation*. .As. Government's complexity has increased, the inability to provide . timely; accurate management ioiorma0on to decision

takers seriously impairs the efficient *livery of

services and program benefits to the.Government's

'customers.' ExemPlis'of,such information gaps appear

) , The Pension Benefit Guarailty Corporation.IPBGC1'

has insufficient information to publish verifiable financial statements and is plagued by case

backlogs and operational difficulties (BANK 41.

. , . '-.

= 0The National':Flod "IniUrande Progral (Nip) ha's a Zits and wt, exists are farthic chmpti'sated-by vianifiCant.plegram changes.

As-a reseal the NFIP is not well- equipped for

jAanning,to'ioieme actuarial' soundnass and

silt-supporting' atatus OW 11).

s I 7'

. w;,.) Credit- .'information on a Governientfwide basis is

not timely, accurate or complete (ASSET.12). 1

ti 6 Other PPSS

. issues Kith product /service related

information gaps include;AG 9, AG 33, ED 3,.AOSET

.23, ASSET 26, HOS-PHS 2,*FEEDING 1, FEEDING'S,

HOSP 116 BOA, 12, HOS? 13, LISAB 4, TRANS 3-knd

USER- 8. ,

8 ' $ ' mentfograms has increased dramatically over the past'

-20-Yeat-m-ang1-*-104-1-ghe17--rate7tiaam-,:tax revenmis.

In 1983; transfer payments (eacluding Social-Security

and interest, of $313.4 billion' will exceed the cos- . bined personal.inCome,.excise, esyste,,and corporate

income tax revenue. ,

Unit Pricing: The Government often does not have cost

information necessary to recover costa from'identifiahle user groulh... ForIxample:

'o Agencies have, no cost accounting structure that

would permit the accurate tracking of all coats

associated with publishing (PPAV 21.

The tational Paik Service'does notknow.with

certainty-the costs of collection of their fees

(USER 41.

o . The information necessary for DOD to seek

'recover}, of costa from insured inaCtiVe

beneficiaries is not Adequate . (HOSP 11);

as) -Other examples can Oe fclund,in USER 1, USER 8,

USER A7, PPAV 1, PENA 1 and Hcisi, 10.

i

.,.:
anufacturing -.Distribution

era: The lack of dual-sourcing statistics and

follow -up evaluatiobs, leads'to the losa of future

dual-sourcing opportunities within thekUnited,

States Air Force (USAy 20).

Other examples of supplier'type problems are discussed in USAF 22, ARMY 10, HOSP'9, JUSTICE 3,

NAVY 13 and PPAV.6.

nance:Competitive reprocurement which requires suitable,,

technical data is prevented due to the :restricted

flow of technical data (USAF 16).

'Other issues which discuss maintenance types of

'Problems ate PROP 1, PROP 2. and LAND 2

but ion:

1' The decentralized itructure of Federal travel.

procurement severely restricts the flow of information to:the various agencies; yet the Federal

GovernmenCs travel volume gives it the leverage

to negotiate the lowest availatile prices if such

information is centrally gathered, organized and

,applied in global contract negotiations' (TTH 1).

Current Government freight traffic management

systems are-not adequate to gather cunsolidated

Government-wide shipping data in order to take

advantage of the Government's significant volume

and.frequency of traffic (TTM 3).

Other issues covering distribution-type problems

are ARMY 1 and TTM 4.

IMPLICATIONS , . The acquisition analysis demonstrates that

the Federal Goveinment is not an

attractive candidate for acquisition.

The fundapenriil reasoniis 0 - a flck of baaie, necessary'' nformation

,,on which tb'seach an informed decision

regaaing a possible

Management information is

unavailable at virtually every management

level in every department and agency of

the. Federal Government. Information is

more than raw data.

4 Management information is

the right-data, at the right time, at

the right place, in the right form to

facilitate effective management control

and'decision-making.

This information failure, or information gap,

,increases the operating cost of the

Pederal Government and prohibits

efficient and effective administration.

70
II. ISSUE AND RECOMMENDATION SUMMARIES (CONT'D)

. PROCESS (CONT'D)

INFO GAP 2: INFORMATION

Issue and Savings

Can the proceSs'of information collection -- getting

the right data in a quality state -- assist in Teducinge

infOrmation gap problem in the Federal Government? Data

colledtion is' a critical step in the Information Management

Process, for the types and quality of data collected will

ultimately affect the information produced. It is difficult to produce useful and sufficient information withodt04

the right-data-input. As the axiom so accurately states,

"garbage-in, garbage-out."

Recommendation's in the task force reports to cortect

the infOrmation gaps related to:this issue,preSent opportunities for'cost savings and revenues totaling $31.0

billion ($27..0 billion wheh gaps duplicated within bther

issues of this Report are netted out).

Background

Once an organization's information.needs have been

identified, the next step involves determining what and how

data are to be collected. One way to ensure the quality Of

data is through the standardization ofdata collection.

Expeeiehce in the private sector isA case in point. For'

years,' standardization of accounting data. collection and

reporting has been ensured through what 'is known as

Generally Accepted .Accounting Practices (GAAP). Mandated

by the Financial Accounting Standards Board (FASB),

corporate compliance with GAAP is enforced through outside

audits.

Similar standards have recently been Adopted at the

'state and local government leve.ls. New York City, out of

necessity due to its municipal bOnd_tr.sis in 1975, was one

of the first big cities to use GAAP -type standards as well

as outside auditors. Maryland and Tenhessee were the first

state,.66- to go to GAAP; Maryland also hired outside auditors.

71

44
The recent move to utilize GAAP-type standards and

.outside auditors has revealed state'and local governments

to be an much ;worse financial condition than originally

thought. ,A recent For'bes artit&d.dnddrscbEes this poInt as

it relates to the state of New YOrk:

The general fund operating deficit, repor.ted at $552 million fn the year'ended

March 31, 198'2, nearly doubled to $1.076

billion in the following fiscal year. The

accumulated deficit rose from 2.9 billion

to nearly $4 billion. The audit revealed

that the state was postponing income_tax

refunds to the following fiscal year"

also deferring obligations 1,ike subsidies

to local school districts-I!

The article further points to California's eyeawakening experience:

California, which has,been phasing in GAAP

for the past'two years, reported a general

fund deficit of $154 million in 1982 under

its old accounting. Converted. to GAAP

numbers, that 1982 deficit jumped to more

than $1 billion. California's fiscal 1983

results are not yet on GAAP, but prelimi

nary estimates under the old method show a

deficit of $669 million.=

Unlike private sector business, state and local governments are not mandated to utilize GAAP standards, but.rather

do so on a voluntary basis. Sitate and local governments

may subscribe to the accounting standards of th e Municipal

Finance Officeri Association (MFOA), a nationwide group.

The MFOA, however, does not have compliance force as the

FASB does through the Securities and Exchange Commission.

MFOA enforcds its rules only by awarding "certificates of

conformaAce."--Only 400 of the 80000 units of government

nationwfde,have'certificates.

The Federal Government has yet a different set of

standards. Mandated by the Accounting and Auditing Act of

1950, Federal departments and agencies are to comply with

General Accounting Office (GAO) standards and are to receive

GAO systems approval. GAO's prescribed accounting

procedures 'areaocumented in its publication, "Accounting

Principles and Standards for'Feddral Agencies" (Title 2),

'Title 2. has not been revised or updated for many years, and

-is at present under review by

1/ Weberman, Ben, "The GAAP Gap,".Forbes. September 26;

1983,.p."215.
Even thqugh GAO mandates the standards, GAO exercises

no direct line authority over the accounting functions . within the departments,and:agencies, and thus- does not have

coMpliancefOrceai the FAStidoeS, though the SgcUrities

and Exchane Commission.

Methodology

In analyzing. the proce'ss of information collection in

the Federal GovernMent, the following sources were utilized:

review'of the 36 PPSS task force reports Of which

26 contain i'nformation gaps relevant to this,

issue;

o review of selected general bu;i,ness periodicals

and publications; and

o discussion with PPSS task force members.

Findings

From our review of the PPSS task force and selected

issue reports, it is clear that the Federal Government is

experiencing problems with data collection. Data is

commonly of insufficient quality to be useful for management decision-making. Data collection problems' include:

data incompleteness, data irrelevance, data inaccuracy,

data duplication, as well as data untimeliness, inconsistency and incomtatibnity. For example, the Generale

Services Administraticn (GSA) cannot track the performance

of its freight rate audit and recovery activity 'or assess

it against.qlother private sector freight audit operations.

Of the $,4.6 billion in annual freight charges it audits,-

GSA recovered freight rateoverchargesof 0.37 percent or

$r7 million in 'FY 1982 compared to the private sector's

average of 1.75 percent, i.e., the GSA shOuld be identifying and collecting about $80.5 million annually or about

five times its present rate. This problem is partly due to . incomplete data. GSA does not know the total freight

charges represented .by the bills it receives for audit nor

the total freight charges on the bills on which, overchargesare identified (TTM 4). Other examples of data-collection

Problems folloW:

o The Veterans Administration (VA) cannot adopt, a

caseMix budgeting or planning process that

enables accurate measurement of hospital performance with respect to resource use. This problem

46
is due to incomplete data in patient treatment

files (PTF) such as details of the patient's

reason. for. hoSpitalization, conditiOn and length

of stay as well as'of-the attending physician

(HOSP 4).

The .G8A'-.S Federai Mot6rNehicle.F1 et.RepOrt's

measurement of dtilizatiop per car is overstated

and.misleading for decision-making pUrpoSeS.

This ptoblem of irrelevant data is due to the

wrong total number of cars being employed to

,,,generate utilization rates: .For example,,Fthe

'vehicle years of operation statistic is calculated such that a car which is available only 10

out of 12 months is only ten-twelfths of a ,car

for the purpose of calculating the miles per

vehicle per year statistic (PRIVATE 7).

T/) Department of Defense's (DOD) rmilitaNK food

budget is inflated due to,theutklization,of an

incorrect Food Cost '.Index (tCI). The FCI is

calculated -rising inaccurate data higher'cost

food-items than those actually consumed in..

Vlitary dining facilities are used.(FEEDING 5).

o In the VA, the, Department of Medicine And

Surgery's automated information.system does hot

provide information needed for efficient institutional management. 'This is partly due to

duplicative and inconsistent budgetary and PTF

data which all'of the VA hospital facilities

currently receive'(HOSP 7).

( o The Federal Government's lack of a compreensive

inventory of its capitaasSets.and their current

condition prevents the identification of mainten-y''

ance needs and, new item requirements as welt as

the development of capital plans and budgets.

This problem is partly dde to inconsistent data,,

as each agency uses its own definition of. a ",:cApi

tal investment" in-_lieu of a uniformr universally

accepted deflnitiOnThis procedure makes a

comparison of total capital investments among

agencies meaningless (FMS 5).

o DOD has been faced with: significant cost over4.ins

on weapons systems acqui.Sitiong. This has been,

due in part to: ncOnsistent data on the cos of

individual major weapons Arsteds, programs -7. the

Iack,of standardization for' base year..dollars,

current year 'dollars and future year inflated

ddllars.(0SD 22)

47

17
a In the United States Air Force (USAF), the Air

-Force Logistics Command (AFLC) currently manages.

a spare parts inventory totaling *17.4 billiorCin

'acquisition dollarS as of September 3d, 1981.

During the first half of FY 1982, lees than 25

percent pf replenishment spare parts for weapons systems was competitively procured by AFLC

.Compared to a high of oyer,37 'percent in FY

1973. Competitive reprocuremeht is seriously

hampered by untimely data, since the Air Force

Systems command, which 'handles.the initial

produatiOn.phase of a weapons system, does,pot

procure engineering and technical data at the

time of-acquisition. Instead it defers the

acquisition of technical data to AFLC after'the

initial production is completed (USAF 16).

The Federal Government lacks an effective set of

accounting standards for.data collection. The Title 2

standards prescribed by GAO are out-of-date and inadequate in terms'of'facilitating useful management 'information. As the PPSS Federal Management Systems Task-Force

reports:, . Unfortunately( it (Title 2) represents a

potpourri' of accounting standards requirements,, Oci6ding broad concepts and specific implementationrprocedures The, requirements included range frOm "the :financial ata.OrodUced by:an accounting system

16,must be useful to the officials. requiring

it" to "separate accounts for major categories of cash resources...should be maintained..." t.

a resule af the wide scope. and differing

depths of.focus of its subject naiter, Title

2,does not present a, totally satisfactory

framework of accounting standards against

which'more detailed policies and procedures

may be'developed. MoreOvet, recent advances

in:accounting theory and pragtice, and in

'the'forMulation of generally accepted

accounting principles for Governments; have calleOtto

2/

questio n the adequacy of

Governments;,

those

. 1/ Federal Management Systems (FMS), FMS-3:

Fin ncial ManAgement and Audit, Working.Appendix,

Vol me. I of II, p.
The Task Force goes on to report,

Presently, finanCial reporting is.heavily

focused on the reporting of expenditurls and

obligations against budgetary appropriations. However, it is widely recognized

that the'accumulation And reporting of financial data by the departmentsand agencies on

an appropriation loasist,,does not provide the

most useful financial infOrmation for purposes of-measuring or monitoring either

program costs or the effectiveness of

management responsibility centers.l'

For example, the. VA accounting system does not provide

an itemized billing for.eaCh hospital patient. The VA

charges per diem rates based on average costs to third--

party liability cases only. ,These billable charges do not

reflect the real costs'of providing medical care because

the VA accountirv? system lacks standards for cost accounting data collection.(HOSP 13). Other examples include:

.The Military Health Care'Systgm's (MHCS) Uniform

Chart of Accounts (UCA) system as currently

.planned does not allow comparison of .costs and

performance among DOD fixed military hospitals or,

valid cost comparisons between. MHCS and private

sector,health facilities. This is.due to the

fact that UCA does not determine the real costs

of. MHCS direct patient care, since it,!does not

include standards for collection of major cost

accounting" data such as construction - renovation,

employee benefits, and general and administrative

overhead (HOSP- 3).

o The Federal Government does not maintain a central

inventory 6f teleprocessing (TP) allocationsor

-1W dllocate charges to end users in shered"TP4aletworks for their levasiof utilizatiOn.and.C.Wst.

TP expenditures arees-timated to reach ov4r41

billion in FY 1983, and to increase by about 25

percent annually due to',estimated TP utilization

increases of 16 percent ,per year.'and TP cost in,=

creases of 25 percent per year. Overarl:improvement of TP resource utilization and management is

prevented by the lack of standards for data cdi-

.1ection of the true costs'of TP for delineation

in the .Federal,budget (ADP 5).

3/ Ibid., 36.

.
, . In some cases( the _standards that do-exist are not

only out-of-date, but simply misleading. One such example

,is-the policy of "offsetting,collections." OffSetting

collections are the funds the Federal Government receives

from the public as a result of transactions of a business

nature, such as thesale of Government property and

products, loan repayments, and rents-and .royalties for the

use of Federal land. For budget pdrposes, these payments

are treated differently than the funds raised frbm the

public through taxes. Taxes are called "receipts' and are

treated as revenue. By contrast, offsetting collections

are not shown as revenues, but rather are "net ed" against

the colleCting department's expenditures.

This policy of netting obscures the levp of obligation for an agency. For example, the Export-Import Bank

has obligations of $54.054.0 million which it offsets by

$3,108.0 million for a net, reported obligation of $1,946.

million. 0)yiously, the reported obligation assumes that'

all receipts will be collected. This standard allows an

understatement of the risk the GovernMent'is undertaking.'

If the receipts are not collected, the Governmeht is still

liable for the obligation. As the Financial Management

Selected Issue Report notes, -this practice leads to

potential misjudgment of risk. In the private sector,

analysts on Wall Street do not simply.loak.at a company's

net income in evaluating a company's perforMade and in.'

determining how risky an investment in the company's shares

might be. If they did, a 'company with sales of $200

million, expenses of $199 Million, and income of $1 million

would appear no different ifferent than a company with Sales of $5 c million, expenses of $4 million and income of $1 milliOn.

Obvidusly, however, the smaller company is doing a better

job of Making money relative to sales and expenses;

Consequehtly,:, the smaller company'may be' a less risky

investment.

The Federal Government lacks an'effectiva,enforcement

and oversight capability to ensure comprlianceNtith Prescribed.accounting' standards. -GAO exercises n*Airect Line

authority over.the.accounting'functions within the depart,

ments and agencies. The GAO approval proceSs addresses

only original systems development. 'There is no central

oversight function to assure that systems are properly

maintained and revised-when necessary or that revisions are

monitored. ,GAO's only means of achidving accounting systems improvements is thiough,the exercise of its systems

approval fqhOtion and the issuance 'of audit reports.

Unfortunately, the systems approval process does not

Achieve its intended objective since departMents and - 'agencies are under,.no time,constra-int to. comply with

systems approval'reT4rements.
Title 2 was esteb shed in 1950 to bring standards to

Federal accounting. TO date, more than 30 years later,

only 209 of .332 accounting systems (63 percent) subject'to

approval by GAO have been approved. The systems that have

not,been approved include some of the largest and most

important'systems, which together handle over half of the

Government's expenditures.

Problems also exist within the Federal Government's

individual departMents and agencies in enforcing and ensuring compliance. with prescribed accounting and finance standards. Por example,. the Department of Educatioii,,which is

responsible for distributing' $14.5 billion in Federal funds

for education programs, has been cited repeatedly for

waste, fraud, abuse and errors. .A major problem has been

the lack of emphasis on management information systems and

internal controls. .9pecific-,problems include the following:

o The general ledger is primarily used to record

disbursement data, rather than in its usual

function as a control of assets' and liabilities.

o Reconciliations bf financial system accounts to

Treasury records are-not done on a regular basis.

o 'There is insufficient emphasis on internal

controls with no checking on the accuracy of

payments.

These problems are a result of a number of factors.

Fitst, responsibility for internal controls is.hat clOrly

defined. Second, coverage by the Office o Inspector . General and program review staffs is inadequate largely due

to staff shortges.' Finally, the qualifications and training of personnel responsibilities for key aspects of the

internal control systems are not adequate in most cases

(ED 2).

Another Federal department with significantly defi-,

cient financial accounting systems arid intetnal'accounting

controls is the Department of Housing and Urban Development.

:(HUD). There are no systems and procedures in place to

a-dequately safeguard, account for and ensure the integrity

of HUD-owned assets.- For example, generally accepted

accounting practices. acrd procedures are not followed in

administering Federal Housing Administration (FHA) insurance funds financial statements. In addition, the review

and verification pf financial information is limited or

nonexistent.

A major factor ih these problems is that no one area

of HUD has been'designated total responsibility and autho-

. rity'for coondtRating/developin4 department-wide financial

51'

z. 4
systems. In addition, no area has been staffed with profeSsional financial managers to fulfill that responsibility.

ANo,there,appears to.be no effective area"respohsible for

ongoing operi'tional audits ,of HUD-related ,activities

(HUD 1).

Conclusions

The Federal.Government lacks standards for data collection and repprting., Asa result, numerous types of data

deficiencies ca h be commonly fOund across Government departments and agencies. To overcome these deficiencies, an

agency-by-agency review should be conducted as to the types

Ah4,quality of data which need to be copecte'd. .Specific

','attehtion should be given to the folldwing data problem

a-r-eas:

. o Data Completeness -- The data collected should be

complete and comprehensive.

- - Data Relevance -- The collection of tod much or

irreleVant Aata'shotild be avoided'. Overcollection of unnecessary data can burden and slow the

data collection process.

o .Data Accuracy -- Efforts's.1-iould be made to ensure

that the collected-data.is accurate.. "Checks and

balances" procedures should be devised where

'appropriate.

o Data Duplication -- To avoid further the excess

collectionbfdat, data duplication should be

minimized.

o Data Timeliness -- Data should.be collected in.a

timely manrr.

o Data Consistency/Compatibility -- To allow-for

trend, analySis and croSs.comOarisons,,data

definitions should 'be .c'onsis'tent across-.

organizatibhs and over tiffle.4

. Many of the data collection problems stem from the

lack:of an effecti-ve set of collection standards. To

overcome -_this deicie,ncy, the Federal Government shbuld

follow the example set by the private sector and a, number

of state and local governMents, and begin to adopt nAPP.

Utilizing GAAP and outside audits in order to develop and

implement standards for data collection of financial and

accounting information will not only improve collection

standards, but will also bring a new and more accurate,

representation todecision makers.

52
EXpexienoe in the Federal Government has shown that

the PreScription Of st and.ards 'alone is 'not enough. Rather,

to be effective, that which is Prescribed must be co4tinuallY reviewed, updated and, perhaps most important,;enforced.

Agency compliance to,GovernMent,,set standards is a ! problM of considerable magnitude. The problem stems from

the lack of an effective GoVernment oversight and enforcement function. It is clear that this function needs to be

strengthened. The enforceTent needs are addressed in

issue 5 of this Report, "An Information Management Structure to Facilitate process".

RecoMMendations

reviewthe types and

quality of data it uses or needs to use to efficiently and

. . "ZL1Z92gbg3.,z2.,.._AcklaItfLtailoring it to the needi

c...)1---1112---Zf1201 Go ,....Y2/Letr4-ARaunting and finance systems.

5 a v mnact Analysis

The cost'

. , .. zaVings,,revenue and cash ectcelerations for

taut the dollar amounts reported are duplicative of ". this issue, Information collettiori, are listed in Table

11-4, i-, savings reported i/leviouslY bYPPSS.and are presented het(...-

ohlY to provide, the reader-wit a perspective of "the scope

. and Significance of the inf-orm tion.gap problem.

A In; repbrting cost.savings and revenues, the Project

Team hasgiven each inforMation gap a primary, issue

asighment, although many bf the information gaps are more

complex than-any one Problem area. Therefore, when an item

is d!.1Plicated within ,the Report, it is netted out so that

the' dollar anoint' for arty single. information gap is counted

only in its primary area.

k the lnforllation gaps and their related dollar'amoumts

are .reported over three years. The.tatile that fiollows

consists .of three parts: two detailed parts,.Sectdon. I. ant

Section II, and a consolidated totals part,the'Summary, as described belcwi'

* o Sectioh I: information gaps which are'speC,.-.

ficaliy.addressed in ./-le text of this 1.

53
o Section. II: inforM4tiOn gaps whidh are 'pot ' specifically addressed in the text of.this

but which. the Project Team finds- relevant to this

issue.

Summary:

and II.

consolidated totals.from SectiodsI

Detailed discussion of-these information- gaps..appears

in the Appendix to' this Report';",whidh-,iS contained in.thiS,

volume.

V Implementation

The' recommendations in INFO GAP 2\cen be authorized by

the ExecutiveOffdde of the President. These recommendations would also 64CeSsitate input from the Office of

-t44nagement and Budget and the General Accounting Office.

,[Table 11-4 on the following, pages)

L.

t.

54.
Tsast:Force'

lasu Number

- TOP IC

11-4-: INFoRMATIW CULLECTIOh 1/

4.

... Savings (S /Revenue (10/Cash Accelerations (CA) 1/

, o .4, ($ millions)

Year Year Year , Three-Year

Une 'TWu Three Total.

: Section I: Information Cap; Contained In This Issue

USAF 16 re Parts tirealiout

,: '> Wit

':. * AIM 5 . . - 0 10114ucesstny Resources

it.11 22. 4 *. 64mat,ing WeaPons Systems Costs

.

... EU 2 e- - Man:agement. 'Information Systems

.t

. FLLUING 5, Tr4 Feedirip servic,es P. - HU,SP3 ,'' ,Central Health Entity fur Uii . ,110sp 4 -'" Planninq and Resource Allocation

10S.1.4 7 VA). Hospital - Als . . 116SP 13 . ,. VA Hedical Care Costs Recovery.

.t k

FMCS. 5 " tilpital au63etiri4

.,.>. . HOD 1 Financiar ManaqemoNt Systems;

; .

.-

, PRIVATE 7'. Federal Vehicle Fleet Mana9ement

,

. !, TTM 4. - , -Transportation Audit.

' -,- Total Section.) Revenue CR) . Total'Sea.C41 1 say.ing's 1S) ...z

. 4" i tirand,Totak,Section 1 Savinqs,and Revenue

i' ,* Memo: 4444 sektion I cash Accuitimittoti (-(. )

1

.,,, 1

1:

$ 206.3.,

145.0 50.S

.... 225.0

650.0

(250.U)

435.4

. 221.5

08.4

84.0 . LI.0 49.9

$ 229.1

. . 220.0

294.5

55.6

247.5

1,595..0

(55.U)

478.9

,.-.-

97.-3 92.4

13.0

54:9

$ 22.0

242.0

324.0

. 61.2

272.2'

2,642.6

(60.5)

.526.9

-107.0

101.6

217.8

60.4

o

.

689.4 (5)

51/.0 (S)

2/

763.5 (S)

167.3 (S)

744.7.(S)

4,887:6 (S) .

(365.5) (S)

-, 1,441.2 (K)

2/

222.5 (CA)

292.7 (S)

278.0 (R)

399.8 (S)

165.2 (S)

$1,272.1.

519.4 $24870,9

571.3 4.:4,16V5 . (11:3/149:72 ISP1 $.4.221..,5

$ 222.5

$1.44v1

$

$ lat:La

--. $

. $9.980.9,

$ 222.5 (CA)

- 4.Q. - iS 8
Task Force

Issue Number

. . - .A141.4 11-4 1.- INOURMAT1uN CJLLECT1uN (0JUTI0) 1/

sj

Topic.

USAF 20

-USAF:22 Procurimitnt of Support Services

ARMY 1 . Personnel Mana9ement

ARMY.9 1Personnel-LRC

HANK 1

HUS-TVA d

Oual SoOrctn9

Savings (S)/Revenue (R)/Csh.Accelerations (CA) 1/

($ millions)

Veal Year Year Ihree-Year

One TWo ...71itee Total

Section 11: IntOtmatien Caps Relevant To This issue

050 21'

EPA 10

-Pension nenefit Guarinty.Corporation

financial ReporvingSystems.

Instability in the Weapons Acquisition

Process Personnel Mana9ement - Loan Walityt1mprovement

National Flood insurance Progrd'm

LCle-Cycle cOst.iny

060 MeOical Care Cost Recovery , indian.Huilth.Service

, . .P16 Student I.oan ColleCt is JUSTICE C As:;t_ :wt /. ure and Forfeiture

'LAND 2

T.1!;Aii

1.1 ',Ail 1

FINIcr..a 1 V. hIC trirt,t_ M..111.1Qt.14:10.

,$ 341.9

68.8

30.0 10.2.

97.9

Ikbotikk

: AZ1',UsK5

$ 736.2 $1,344.0 $2,422.1 (S)

75.7 83.2 '.227.7(S)

66.0 93.5 189.5 (S)

11.2 12.3 33.7 CS)

107.7 118.5 324.) (R)

2,313.i 3,816.9 7,181.7 (S)

1.8 2.1

200.0.

'20.7 33.9

10.0

(1.0)

'86.9 8.7

. Ft,kra I .54-w-nt 1N.w Prt.jt.Adi ti)r Autonut_ turr

(11 :tat,:,14.:ilare.

supft unk-nt it y lacom Pt ()qr.=

" I 4.8

° .46.0

..:41 A), '

4

220.0

22.8

39.5

10.0

(0.2)

95.6

.19.1 50.0

5.2

461. 26S

242.0

25.0

A3.5

10.0 0.6

A. Aft. 61.7

'10 22.0

88.1

5.8

.

s 409 9

- 291.6

6.2 (S)

2/

662.0 (S)

2/

68.5 (k)

146.9 (S)

3a:0 (CA)

(0.6)(S)i.

244.2 (CA)

49,8 (S)

146.1 (S)

15.8 (R)

1,379.2 (S)

p: .1 797.7(5)
e

Task Force

issue 'Dumber

'IA01.1: 11-4 : 1(4itnittATlulti COLLECT1(A4 (0.111e0) 1/

Topic

Section IL:

PEat-FUliTHER. SIUUY 2

PlttX8 PRUC 1/ . PRuP 8 , STATE 4

STATE 5

VA 1

VA 2

VA.3

PRIVATt: S.

Compensation

Savings (S)/Revenue (R)/Cash AcceleratiosSleAl-1/

($ millions)

Year Year Year Three-Year. one .4400 Three Total

InformationiCaps Relelint To This Issue-(Coe0d)

Cost Estimating 46Schedu1ing

Physical inventory.

GSA Pulieles and procedures

Fotkign CurrenCy.fotures

liorUao tur Refugee Prugtams

Claims Processing

_Error Prevention'

Debt .1.40.1ect tun Commissary operations

Total Sctjun 11.-SaNind3i4. (S) 7. , Total SectAun (R) v.

.hC. . dnd.R.41!nue

.sceietatiun.(CA)'

., Grand Tkital Section 11

misro:..Total section 11

2/

$ 300.0 $ 825.0 $ 1,815.0 $ 2,940.0 (S)

2/

29.7 46.8 68.0 144.5 (S)-

5.7 5.7 5.7 17.1 (S)

21.1. 18.5 lo.i 55.9 (CA)

1.6 3.0 4.1 v8.7 (S) 82.1 90..3 .99.}, 271.7 iS)

445.0 495.0 544.5, 1,4114. 1kaS)

123.9 41.2 42.9 208.0 (CA)

, 53.9 (S)

12: "4 623.6 6,85.9 '

.1.7.7 23 754.5

.8

.,

.-. 2,064.0 (S)

,..403313.0 39.6 ° 43.6 - 383.2 (R)

$4,002.9 46,428.7 , $9,764.8 $20,196.4 (S)

413.4 175.3 192.9 791.6 (R)

$444.26..-! $A..0441 $.9_,.9_St, UMW!

- * iu.1 $ 165.3 $ 130.7

.. $ , '538.1 (CA)

1:7-11t,

.." 1114'.
TARLC 11-4 i -minDR4xTioN ODLLECTIONACNrD) 1/

.9

'Savings (S)/Oeventie (R)/Cash Accelerations (CA) 1/

($ *lions)

Task Force,

Issue Number

. ,-. Year , year:. Year Three-leer.

'..'ene .111,Ki. , Three ' total

Summary: Consolidated Section I and Section II Ibtals

'Distal Section I and Il SavIngs (.5)

'Distal Section Iand II Revenue (R)

Tbtal Savings and Revenue in , Issue Less Duplicated Savings 3/ y Less Duplicated Revenue 3y

' Net Unduplicated Savings and Revenue

1,k$.54-510 i $j2A2q112. $ 1267333M. $ 2241.111-

Memo: Total.:CaeatAcceyeration (CA) $ .444.6 $ 165.3 4 130.7 $ 760.6 (CA)

. 6 Lose Duplicated Caih,AcCeleration ,-319.4 105.6 ' 71.7 496.7

. '.

' 0 $ 5,27510

942.8

$ 9,294*-,

746'.6 , 13,883.5

c 821.4

' -.. 4 28,458.1 (S):°44;

2:510.8 (R)

1

$ 043114 $.111411,1.2 '.$11.44-W.f.2 . $ lot962;2 ..

0 $ 620.4 .$ 1.143.7 $ $ 3,:028.6 88.8 $97.6

.1,864.5

107.4 ' t 293.8

Net Unduplicated Cash Acceleration '4 145.2 $ 59.7 $ : 59:0 S 263.9

1.

! c , 1/ Amounts in this Table represent duplicate cost savings, revenue and cash acceleration previously PPSS. These amounts include inflation and are reported by

net of implementation costs. '

., 4/ Not quantified.

.. %

6

0

. . . - 3/ These amounts _ claimed another issue within the Information Gap Report and ar e netted out in this issue.

_ All dollar amounfs in the Information, Gap Wort duplicate savings previously reported by PPSS. ; . -

\ r. 8.)

to
AND RECOMMENDATIOirSUMMARIE,S D)

1.1

INFO ,,cAPIssue and Sayings.

f N

- , Canj.mpxovement of .informatiorr-systems;:ldleate cost

saving.efficiendies'and facilitate managerial decittOn7'

making'throu4hoUt the Federal:GaVernment? .

Federal,informWorLsystems9form

.t seen the collectiorLofhigh:qualitY raw data and the issemination, of, useful-information for Go4ernment operations

and thnAgia1:decisipn7-making. The informatidd systems'_

fUrttionis Ocilit.ated by a variety' of systems ranging

from.aUtomated-data processing (ADP), used fOrrecatdk#kiring and data aggregation, to management inforM4tioh

systems (MISS), whiCh Support decision-Making. The ,Costeffective operationaf the Federal Government depends on

coordinated developmentand uilizaition of these systemS:-

Recommendations in the task force r,eports to correct

the information gapproblern relatedto this issue present

opportunities for .savings afid-levenues of $15.2 billion

over three years 413.3 billion wheninforination gaps cited

in other iipsues in thit: Report are netted dqt).. -

INFORMATION-:SYVEMS

.;

Backgr%und

a

,.

.

, '" 9 -.'.N.F7

7110 4

., '

. . .Present Federal automated infarmationosy#ems are gen

.., grally based on caMputer Osigas.of,tne.05*44 early

1960s which have been successively exparild 'n4,modified.to

meet new program and functrional-needs. jh. ti "Pd-19613s, lk

the Tederal Gavernmentperceived.that the p ion of ' ,:-,- Government'infoxmation,SysesmS,04;s:out d/ co One de.!''

:the controls which 'evolved was eht,.Brooks ActlIQL.-89306).

,-Yin-1966, which- gave the.General.Services Adtipisttatione.

.,-iGSA) authdrity:fat mariagiqgADR. acquisition and'Oromoting

4shaxing,amongagenties. The Office Of Management and 4tid7

.;173 (OMB) was maderesponsible 16r ptovipding15611. g41.:

:atic!, and the NatidnaLBureau of:StItPdards. CO$S),wittin:h , .,.. _
D'epartment of Commerce was required to

. develop uniform Fed' erS1 ADP standards. In 1976, Cq4B,Issued Circular A-189 to prescribe how, major systems -are to be acquired in order to ,j reduce cost overruns and justify needs:: A public/private J study initiated by ON1 in 1978, known as the President's

mendations to improve managem nt of information

ADP Reorganization Prbjece (PRP) to a series 'of recomtechnologl. .

1 In 1980,' Congrepa pass he perwork

Reduction Adt (P.L. 967511),Which'ingorpOrated many of the RRP recommendationS ThiOict.'macie0MB responsible for . . 7.de.iireIopit :an4.-,impilemeting'.0bliciesrpri-nciples, stan7

-dards and,.4ciieii.nes'.t,o-APP:,'-and_:.btrecjitiinunica6;ons... and .. , - Oerse4in. the 'estialiShmOt:of standardp.'' The foregoing Execut'i've and Legisiateini.gittves:.represent the pancipal itteriptcb the.Tedral Govertime'nt td: ructure the Ad ev elOpmenijo its intirMatibn systems.

.

. 1. ' t-Olt-ii.',''.0)41tAelerA.L'GLovernMent.e i'ies.'Over',6,000 general Urpose datAproi#A,i'ng.s.stems (-111U4ding adminis-

- . ttaeivesysteMs suctias-p4gflpel. aArto114 'etc.) and , ,3

almost 11,500 spe 01 purPcise.'s,?s Noweebons, ,imbedded f.,,,,, 0., iy,Stems4.4etc:). he P_ PSS,I.Automa Data Prdeessin,q/Oftice.

Automatidn TaS!k-Porce estimated t total annual operating

cost of these _systems to be.at-least $12 billion. However,

.thq impact of FedeTal.information-systris_;Thoth manual and

automatecr,' on;the effecti'vdness and efficienCy of Governmerit operations 4S'considetably.more-substantial than tpeir,

, Ar operaein9 cOst'..:-/hiS'issue focuses on theieconomical10-..;

quantifiable4reas otiimpaCt identified *ptlier:.0,PSS:Task

Force xepotts that a4e;a4tribUtableto the-quality,*4 FedN.e;.e.r information siqs6ms.*....,-

methodology',

4 In analytjng edera4;information systems,

rowing soutee,s were utilized: 4 the folstehe.,36firias4 force -reports plus the.-

wsu.eviel,Ors of;wh,ich. 24 contain rla, Tto.OliS:issuep

,,:4yiew,..ot.,seleot,ed General. Ptrountlng Gif,fide

icaO.Abne ;

Oft3eneralbusiness periodicals and

licationiv

discussion wx,thk..PpSS:. sAtFprce

et..

-

pub-

.

..t. '..,..,p' 7.-: ....' i ,t.'

1 - ,t , .. ..- ,

'.7 7: .4

,. ., ,,,.:

. 1; ,

.., ' 16

.e0 4 .it' f' Jii,',.....,,, ; , ,,.[..-,,, ,.....--. , ..:.,.'01 ? : : . : : ,' . :, . -
Findings

A lack of. top'Iever manage `lent recognition and- support

of the need tosimorove information systems continues: Much

of the managerial weakness at,all levels stems from a confusing set of policies, directives., and uidelneS from- the

agencies vested -with authority and'conteol-of'information

System developpent. The re'SpOnsibilities fortioiCy fotmu-

'lation, exerdise and evalbation areJragmeGnted and} -Overlapping: ) (R- o u113-has allthoritY-14cY. 4114

GSA is responsible.fo4eZerci;sin:OblIcy C-Otrol,

over Fed ADP resourqes.

.tNT... e es

tion ds.

. While 0MB ultimate authori.ty..tolnanage ADP . . , resoufdes and development, ithaS,nOt.leoordinated-t.he.,,

activities of:'GSA,-NBS and other eget-I-ties in' this respect.

yurthermeire, OMB has emphasized a budgetary approachibtO

information systemdevelOpment at the .a+ ,level.,.iWathen

than !leadership on planning, acquisition and:Ongo4ng ,' 41.'

management. Hence;. the emphasia'has bee n.evalUatibq

agency ADP proglitms'A a "das-eAg-caSe., ba isand ignoring

interelattoxishipe. of agency information:-regpireMents. -

, . . - In Alliition. t .ineffectively ,discharging ititoversight . .

. ,reponsibilitties, ''';', has not:* emphasized providing for..its

r. . .: -..,(n- information Otz - The kindsatif aggregated data, and

:.- .ii ,. .management inforniaton, eded to top.etate, a central agency, *- 1!,..°

-!.. ,7inCluAing GS.A,t4t':,OffICe Of 'Pers'Onnel Management and ,he

-,. Treagury.,:haVt,not6 en. developed. For'example, 0MB

4, -: y.tecently notOfth s insufficient information -.to;, 4 4 monitor: 4.' -4 . , 4 . %

,t

'

, 4

software, design an ocumena-

,.,t 4., , 1 .

.

0. Govetn,,Me ash alaocet;

.o personnel resourbes an&Skill availability; or

: o total Fedeial f4nds mit

1- states-or51o4saiitie

In managing 'its owniriferOaEis reqdireinnEs and

.. uldwg those of other'agenci'es, O a.s'nOt-ecogniZOci l .

. ,

. , : ; - .. , , . :h '"

. . . .: ,.

' . . , 4OeephAWri.,DeputYn. August 1.913 :1(jaShngton.' . , egtzigiof. OMB, r to .

.11 .' V " . y , . ' !- ., .e .4? ,

.-

..trl'UtY

'184 1.
.4r 'that dfcision support systems are distinct ftot data

ptocesting'syttems in purpose, mse and characteristicS.

Consequently, syseetS are-nOt always providing decision

makers with the tocas.they need t6 manage. 'The following

examples.are illuStrative, :, ,

- ,e.

' . . I. . o -The Pension Benefit Gudrantee.COrporatiOn.bos 'insufficient. information fto 'Publish verifiable

financial

J

statements aft4reven years of opera-

-tionBANK 4). - ..' -,...'

o 4 Information systems in the of Student

Financial,Aid(0SFA) gerierate poor, data on loan

deficits, and no reports measuring delfquency at

the instieUtional level- ate _ovailabre to' 'OSFA

managemeraf(ED 3): . 4.-

. , No. central Area-in the Department` of ,HOUsing and _ Urban7Developmen% (HUD) has responsibility for:

-'coordinating depOrtmenfwide fin4ncialsystems.J.

As a result, madagement.does not 1,ave the inf . 0

motion" required to guage program activityand-

,. effectiveness (HUD 1). .. - - oftt The Office,of Foreign Buildings doe no ,have4

..,-. management infotmation,systet capable'. iden-

.:-.' tifying coSts for buildings eithe %ind idual)0 . or in aggregate (STATE 3).. `IP*:

44-:

.

.. Withoutogabd'decisioil support 4..ncormationytanOgers

cannot- adequatelyAssesstpeperformance'oettheit genaies

or departments. ',..Therefore,those'esponsi-ble for ex.eciiting

..91:44fic functiOns cannot be*held accountAble.. For :- ,exatrile, the abs*nce-of aOtomated,"ysstems for- quantifying r . overcharges And.tracking . "e:perEopnance-of audit reviews

.i-ntheOffice of Tratnspair Lion Audits prevents GSA from

el-Oluating .itSneight rite audit activities (TTM.4). F-.

,,*

. MapagementsupportOf effedtive information dev.elOPt: 7 .melititis also°4indered bro'budRetary process that 4Drbi4s

-...-. *ewAricentiveq fot.good!perfOriance. (Managers are reit

-tarit to implement .systemSthat-could ppit,4to Spedif4Ov `, ingS ifatlose savings 0ass through to .the IrlYthe

fort pf -redugeg.ency,b6aTet allocations; ''' ,.. ,

. . - %) AIrq.egt(at4e; ocaystemp,ii.VelPPmert aTong ernment.'

agnc,ies and dqpjArtAgnt°S:notietpllas letby 0 and other ,,

I ovetsight-tipiri,es.7.`" Tbe7,.pbt:04..a3...for -sailatifigS:,,py: a* aqi,r13% 4.

tht-ipolement; ropct4111hptmpri-4sysAhms for J.milaf,a m01-:;,- , . -, stfative 1'..c'"'..- tat i. vaW.,' Korgpvia_p., age.nbiel.hay4 alW.a.- -:,k.: . .%,-.. ..,t ion 'P WO

' ;'. '-*:('

4.'i"

''' l',.1 - ; !i10,40,; .

4 1 . * i! '0Y: .,.

;'''I. ;11C II: c . .: : , ?7 , 4' 11

44#;. .

. i .

Q.

AI.

''i40 'rim A.aLa due 6 1.

,-;);='e;
incompatibility among the different sysstems..

.4* ' The responsibility for managing integration of informa'tion., systems is nOt 'clearly defined. The policy directives

- contained in OMB Circular A-109 do not call for a_ review of

interagency- :considerations in the system acquisition proceSs". a ...-- ..

- '

4.

Without enforcement by OMB, individual agencies- are

reluctant to giv.e .up ahy of the control Of new sysEem for- mulation and acquisition -that system -integration may.; en- tail. - Information systemsf-continue to be formulate in a vacuum, withdut recognition of Government-wide requirements

for system .interacti,on. ` Within individual agencies and 4ejiarments, -the information 'management function:lacks an executive orientation.

For example, within the Health Care KnanCing AdministratiOn (HC'Fik) , no long-tange _plan exists 'for the 'Orderly develogment and implementation cif State-of-to

systems to break i+CFA's dependerlitre on the _Social Security Adm-init,ration's outmoded. itDP "sYSteM. Conseq.uently., t'nnagement* hag been unable to utilize technological advances with th'e potential for s-ubstantial jsavinfgI

,operation coasts EHHS-HCFA 6) . The lack of a-ormal ;glen- t

ning rocess p.revents,managers from establishing agency objectives and a .road 'map for achieving them,

Managerial weaknesses 't the agency lev*Calso dont ribute tb a lack .of inte,r,nal controls .in systeM use. Program

operat4k managers in. the Department Of Education .forward . paymenallequests to Elinlanaiial Management Seryices (FMS) that' raly on I.nadequatel? validhted data provided. by program

units PMS "certifies" and processes the t)aiments despite ": the lack-, of `v'alidaion: .ts a result, the Depaittment is.-

repeatedly cited- for waste Ss -.unreconciled computer errors

inount: up (ED 2),. ; The 1.a.ck of an 'appropria'te management structure in the

agency 'infOrmation network .aggravates, the systems defic.denCfeg..L For akample., each major ADP.,sySterri suppbrting - Veterans Administration (VAL hospi_ta-14. fristhe fielO is

mallag -remotely b4y, project manager in Washtng.ton',

9

4

ITh** tuati:orn _of " n). has a risen

the V .;has pev de vq.V4,P'ed.:\a-. *iv n t a t,4,

.11; .has merely -data;f or: witr"k, 4,1:pad. biadg-eti n obleq-7- ,11, 4,,

v a s ( HOSP '-r7) 1 01!*,

.4

1 o. addition

Sett cont.rXels-itiA d4

.

.e. . 4

4agncies poorly tii5gnO(g '`ayittevl

otif f a i I tic) ot.

9-;'' r, ". . P.:: ' . 4 "40' V:. . . ,70,4 1. 0. -

"

, " :

, ementi, stip . plan =2.-,

&ping ai-str, mangy r pl.em,*n.a.t ion ON rYrani

p r i m a r y . " " , '

'41t. 13:111:"

A -,;

4,, d

;

t_to

1.
;A. 4 in the:imremetltation staggs. Within, the Envir nmentai

ProtetkoAgenda, Agenda, userpercePtitins of lts=F as cial

Managemgnt System.are:generally'negatee bec Oey dam.

not-:40eTstand its fe-aMpreS and capabilities .(EP-Pilkg,i4..

r Existing info.iMation.systemg.are inadequate in effec

tively perfo,tming the required tasks., Systems-hatdware and-

--softigare in the .Federal Gduernment-are technically and

-fUnctionally.absoiete. A latk of cen*alited ADP manage-

-:Ment-fostered a- decline from the fate. 1960s.and'etirough the

1970.s in state-of-the-art systems technology relative to

the private.sector. The average age of Federal ADP -hard-

.ware of September 30, 1980, ,was-approximately 6.7 years as competed to about half that among large private seCtOr

-firms. As a .determinant.-of functional obsolescence; szsEem

software-is also-lagging,behind and would reciaire.sign7T7

cantconversion expense to adapt to new systems hardware;:

7E.xaMples of the high-degree Of sys"tems.obsolescence abi6Und

throughout the Federa). Government: , o ThelEconomic Order Quantitly°(E0C)). systdm used .by

1 GSMeand the Federal Supply Service to minimize

invntory costs are incapable of handling. modern

forecasting methods (Pg0C 10).

,

pu

.

, In tbile Farmer's HoMe Administration, MISs .are

insufficient in supporting current credit

oTgaelOization and servicidgirequirements,

seriously:hampering the agency's ability to

effeCtively manage. its.tedeivabdes

4 o MISs in the Urban Mass Transit Administration

.cannot-produce'updated infoimation to track

grantsand Monitor grant overpaymenNd.(TPANS--3).

. . . The MO- toeing

, and collection of delinquent

...account in HUD is hampered. by antiquated ,ADP

'system . HUD haS: no accurate idea of the total

numb of delinquent:loaa-g, outstanding '(:HUD 3).: o The majority df Air Force Ldgistics Command .-..

.,. 0

,(AFLC)Hinfiration systems use batch processing

and-punch c rds for cOthputer , . input /output, Tesulting in tlimbersome datia PloCediti,hg-USAF l3)':,

. , ...

. . .6 - ' 4,41 .. -- Tne.Ap _sytsems thattliip-Depde ci.f Deifense

:060D)-u%ers for-TinvelltoN manatie .ent..kre unable -to7; _ ,handle ,p161-rchgSe regui drisitidrein:twic a'., 1..

' ' Y Or ;Per neA :item,(0r -SD.2..):. . '..,.Y..-

s

,
The Integrated- Data Retrieval System used: by t

-Ineiital Revenue Service DRS l'System Centers

aceratss on eqUipm%nt that is 20 .yearS old

Outmodedcomputer equipment utilizerpt, by he De-

.partment of the -Navy produces ilaaccurate inven-

. tory records leading to excess-1W inventory

losses in -the Nal/

8 . pply systemmiNAVY- 8) .

,,; nformatao sy t f increaSingly-Weaken the

agencies and' epart ts to carry out t eir misSibn cost-effectijely.- Aperatihg-T cos- oSts are excessive ue td ,high,ma"inenarice charges large floor- apace require:',

menes4, hiqher uiLity costs., and 'greater numbers of operat--

ing ::personnel. Hardware maintenance is labor intensive and

especially Ogpensive,an t heipany systems that are no longer

supported by the manUfaCturFr :And require Federal ;ffii-Ihtenance specialflts: OUtdate& systems alto experience fre7_ - quent end lengthylieriods of downtime, resulting in 011ate

reports and data omiSSionS. . ,Softv4are kaintenarideoostlIali.

'-due to the' dhpreaqb:oCPersOnnel led matatri1-4

rsof,ware .programs that .'are out-OrsUate. The diversity

of operating systems and lack cf ; standardi2 at ion increases

software maintenarice and conversioncosts substantially. . Another critical disabirity attributable- to outmode'd

equipment is the absence of fl'ow-throughdapabilities to

perforgiVquentital, funCtidns automatically. For . example,

. HCFA f iTed 'a-re sequential tape f i les) that MUSt.' be- completely ''r written in eact.nightly. update for processing in

the. present Social Security Administration-clata system.

Thg.hilh , degree .cf 'human intervent\ion cause excessive..

,error ratesrequiring:reruns and-wasiing 1,'5W-tentral

'Protessing thit (CPU) hours per quarter. ' Additionally,

_HCFA Bureau of Quality Control is bising cUrrent cost studies' on 1979 data,- resulting in poor financial c6ntrol '.

(HHS-HCFA 6 )-. .. -_ ,

. , . .

. , )

, . The decentralized. evolvement of ihformation systems

. within agen 'es has led to the prevalembe of systemS at

. multiple f,,a lities that are not inte d, --,The foellowing , exaMples illustrate the consequent , ine iencies:.

.. (3 Eadh bureau andtf f fdp- with4n. Okle Dpparement of

Interior has. de eictiked.it,s-oWn.da4hreteipts and.

digbursemehWiSysi4M.',:operate0 .t -'its- oWn ooiled-'

tteti pe,gterg17.: The aUt*omy at. these. :syst.effis .r.esults in a lack :ore reliahLe2 infd!rMatIon. for cash

.management; :activ-ities (AST,ERLOA.'9). ., .

1.-. . itl " ,v ; , .

'

'

4

65
----."-PC-C-.M.C,rC tc,

(

) lioilitteatfd.friformationA4;tims at the

WejTpreYenf XA noopital adrinistratots from,

recei.17kng us46.il-management informatioff. The

systemgare orttnted to feeding .data, into central

-peocessing systems without the ability td.re.-

trieve 4saggregated, c'Omparable datafor making

'decisionsat local levels 4130SP 7)..

. . o _Thg_finanCiAl reportin,s_systemiAeid_tly_t_he_affice

of the Controller in trie Department of Energy is

notstandatdized.across the-various operating

locations. Due to inconsistencies 0reporting.,

Accurate data on both fixed assets and non-fixed

-asset proPerty Cannot be compiled(ENERGY

.. Apart from being outdated and non-integgireted At the

agencY leVel, Tederal infOtmation-systems Are-typiCaliy.

Y:overlo,,aded-Dtie,to.-imstifficient capacity -of- Social

city ADRAys"tems, tlie:agency baszaCcumulated considtraplev

pack logs in pbsting, wage items to individual acooUntst. . fr-furthefrtote-the-AdmIni-stratfdn'-fsunab-le toTcampat-earhjags rep-orted' on W-.2 forms. to benefits paid, resulting:in,

the misallocation, of. funds (HHS-SSA 3). Systems :with

ilsufficient ca4wcity are hird pressed toillhanA4-speci41

requests or" changes 'in 4serneeds as' agency milirSions 'are

redirected. ''W'i'th many systems operating at full capaCity,

further expansion of data processing needs cannot be

accommodated.

Other. arcs of _the Feder-al Government have manual

systems in operation where automation would greatly reduce

long-run casts. For example, theAccounting.dystems within

HUD are primarigly.manuai. Ingurance &laims in process lire

tracked with a 3'1 x 5" card .file. that requires thOusands of

-irt-4,hual,entries As another 'example, the lacie.of10*:-prCces-sing-systemsAn the''Dep-.4'.ettent-df-Bealth an

_Alan Setvies (HHS) Tublic Health Service result in poor

-ontrol of billing and recekvbles. As a consequence, the

debt delinquency .rate is excessive.(HHS-PHS 7A). 44.i.Vy

work lo'ads and'growing-biCklbgs'in these an .numerous other

GovernmenOinits cause errors and delayo.'::As'a self-perpetuating problem, heavy, workloads have created the gperc40--'

tion that the'codVersipm time, required for.autoriation

cannot be afarded.

Theability of the Federal-'Government.' tp operate

efficiently:is further.conStricted by.the extensie use_of

'ihcOMpatiOle'systemsaCross departments and:Agencaes. This

Sittation-exists boe.ft fos. GoVernment.units that InteraCtl

dithCtlynd those thAt-petfm sitilatHadmini4tiAtilhe.
.,

funeeiorfs%: 'IncomOaible systems providWmiSleading and

non - comparably infor"matiO to.tgh.q central agencies, such as

OMB and G$A.:Conseguently,:,th0,14ndp of iqformation needgd

for. top level Executive Branch management. are never.com,.

_piled. A-few examples of information Government dec.ision

.makers need, but do not receive, follow:_:-

o 'bud4-et-versus'actual obligatilbAs-or outlays

--more detailed 1-eye3 -s-than--apprivr-i-ations-tt

example, program, subprogram, project - ,'activity,

location, etc.);

o" Govenmentwidestatistice on the oredi-worthi- t

agtsof borrowers;

,, d 'individuals receiving benefits from income main

tenance and otherprograms througn:more,than one.

agency: - . -

*14,,

, ., o inventory MIS;' i . A

O location And utilizattbn ofiereal and personal

,property; and 4, _

'''

. . 'o Overall receivables due Federal-agenciesfrom ',

various loan programs. .1) - . ,.,- 0,

The-fragmented development bf automated administrative

systems has led to a 'proLiferation,of different-Systems

doing s im-i-l-a-rf-unet-i-on-s-4----m-dnyagenc-i-e-s---an-d:L:lepa-et-m-e-rits-.---'-----------------------

GAO hai identified 33.2 separate accounting systems and 319.

payroll' systems. f'here is.no comprehensive listii5g of

adm7iniskAlpsyttems,and the executive Btanch_,Ilas no

.idea low much .0.ex_cost tq develop.: Despite,...ExeCutiVe,

.t_B ranch-effort.:s."7WIStanda_r_dize_...i_y_stems*,__.litile7Siiog't 6$ s haS,.,.

been made (FMS 2) .° ' -,0, -

w ...,..,

. Continually tedeveloping.sepktate,,utomated'syspilps

for'commonadMitistvatixe Sunttions is'extreMely.wasYef0

Initially, costly softjare development isAuplicated

During operation,' software maintenance costs- are magriTfied

as-systern Changet'are needed..- Finally, System conversion.

-.costs are increased as new:system's replace :.ox consolidate

the 'hodgepodge of outmoded-systems. ,'Additionall'y., infer-4.

ageficy comparisons of - data aie. more difbicult' And' cOst4Y...'; 8 . -. when utilizing data from-inlompAtjble systeMs. -6DiBif,.ring

file structuresforatt.strage-receslltate customized :gcmputer,interfaces for ,eath.applicatioW;:which.hinderS

..r, 1e,: Y. .:,

-- iNlemantation of. matching. orostams. ."),M40 INFO 'GAP 4.); . -0, 41 1 %°- r; .

,

' ,:' : ./

I ,"

° ;

'67 r.

(1
r-

\Z"--- A chronie Shortagiii,dt qualified and':exper nod pe-r- _-sonnel undetnripe_ the effective operation of 'Fe ral tirfrtrmation systems SIVStems dsyel0pAlOnt mpleMen.- tation by. difficulties in hiring d retaining' qualified data pt essing ,prkfeasionars,.- -The-(faetars ttiat perpetuate this pYoble.m are deeply rooted: . 10.1" * -

,.... _7-,

cl_a_ssific_aVn-_prOceditrf'1; - '11

.., , _. ... 1-- -"

...._. o - a slow hirineprocess due to lengthy Piede.c,,a1

At. , . .

, compensation than for comparable positions in E-he privaie.sectbr.; add - . , - .

, . obSolete equipthent wliiCh "doe'S not,provide the- opportunity to develop marketableslcills demanded.- in' tie private. selpor. ,.,

tive

If -

A ttertpt-s-to r-Letr e-s;s- SitTaz ion ay.e been .-ing ec- a to date. f

ti m ' b . Additional -de f-i-c-i-enci-es----ian the nl!m a qualifica=7 - t s of , Systems personnel ...exist at ..the, Ope tor and user ls.. denerally, in'adequate training .. ,-and 'supervision are adin causes. The- training of AnexperferrOed -stAtems ' --_ c.

' PerS0nRel. is expensiVe aradtime-consiiming 5.0th in terms,' of "`human resources .,and errors in syst,egruse.duing the trai.n-

- ing -process. Insufficient training- and system orientation . .,-weaken the integrity 'Of' system conttrols. For ekample, :: -controls in the /Federal Employee Comperisati&V . (FEC-.), ADP

sys teln-a_r_e_dep-endemt--upon-- -1-owing-p-resc-r-:i-beel-Tp-rocedctrres-.-- ---*-----------, Howevsr, these controls.are neither complet 'nor .uni-, .- 6 formly enforce^thrOughOUt the ,system. FE ersonnel are', oriented, toward paying claims quickly rather than detecting abuse ,(LABOR -l) . Another.example.is the -misuse of the E0- i - system for Federal ihveritOry control: ?jean, 'lob( -1da1s' .' `.:',:' ' .,frequently-comoel-s invey managers.. to override, the iTiTh systElm' . _ by increasing order Size ;nit 'results ,in higher-initentory. carryiiiig costs (1211bC 1.0).,,, ProceS,sing new 16ans admini:- , stered by the'Economi'c treyelCipMent Administration diverts ..4 '.

P

pe-rSr3nnel. resources 'from-documentation ar debt Moni-torifngaii.." functions.. As 'a r-esult,wreserd keeping is incomplete' anCirw% -.i., debt -collectiOn is neglected (cOriNitiRgE 5:). -i*g. . S. _ , SV ri-

,.% :_k. Ina0e.quate Orientation 'among, users alSo, undermi-nos:- .-- "4.1 . informatitin ems ef fe"ct- ness. ,,,:Fog exa7tipi eh, a lthoticib .. :.'1, the Envl,ro -t.Pro.feCtiO glOttcyts FinanCial 'Man'agemaont, --..*,.--;!4-..7 System_ ia len t.a ly. i0 ;TO. wip rIcab 1 ei:,i,,i,pad.eqra te .1as,r .: .1:. ..1 , understaldi -- of-, i, t Sr capatri 1 iiftes '-',?e,a't es eeiO r s', and. "":,...1:1,?,',', . .. ,i 'errors encourage the,deN4e1.9pmen,,e.,4,o-f altetn'ate'acCou9..tingi` -: Systems- rEPA 12) ,'%.4 .., , - .-,, I: . - ' . t , , . e: - `

! ..\ ' ' , ' -' ''. ; :

( f 1..' :

7 i

' .

r .

n .1 -4
y t tr :, , - -.. -- -,- . - ,-4.-_, J w ` - .

.J.: f . 4 . -.A:lack of . and understanding, greatly

Pc,- reaUCE 'A.1,iers! abirkty to utilize systerrs-.Capabilifies . . . . - a '

t tha.k.,&- 1.1- extent.; e

-4 . < :. e- -, --.... sk

,

3- .,;,, a ,.. -The.-aredetral ityitem a process sign.ificantly, itii,a,trs tht_ ability -of ,.Government to incorporate effective ADtvidas .teot-fnol"ogies. 'Long delayg in szstem pfocureinent et(S:tall-,implern-entatio4prog.rettik.- 'The federal acgui-si- :

.:. . . 0 stp s-__t a k es..-an, _average .1:11 tsito and_ 0,ms-half_ ,:to fou r ;

s to cloirrplet.e..-khereas the.-urrnal prillaf sector ADP

cong,liid4d to' 1.8, months.. The leading to -s.°esneributing to Govennmint delays excessive

zoc.0- Ural sEeps the approval process and a confusing 0 tr regulatory policies and directives.

1°,11f4.14.- -`"-' The,-,'typical. s;erSs in -the Federal acguiiitiaon process 7q.k."61ricluaef=exterCsiN.i.e regbirements` definitiOnrisystem justifi- - a

,O.,..oi 4114-1,15r.ocu refrient p r oc e du r es , a s'-'75.41 010/414.n Table 11-5 . .

o!' [sapie II-T on toltpwing page]

,.a

. cis k

it it - Y.', .;

, . 1 7 '" r ''''l t. r .4 ,i, ::-. , . , ,

, _ 6. ''''. e.

. ....L....

?

-

I. 6 2

.

.1"

f_ . - .

ik co, 1 6. t .4. t-;

io

, s, f .04

. .2.1 4 ,,P 4 filo..

if

411-0, .

1 '1

4 -
TablesIITYPICAL STEPS IN THE FEDERAL ACQU/SITION PROCESS

s Task

. REQUIREMENTS DEFINITION/

SYSTEM JUSTIFICATION

A. Identify Requirements.

B. Complete Conveision Study,

-C. Complete Cost /Benefit- Study

D. Obtain OMB Pipprdval

E. Obtain'G9A Approval

F. Complete Request for Proposal (RFP)

G. CoMplete Benchmark Package.

Probable Rande.(Average)

1.5 - 2,Years

II. PROCUREMENT PROCEDURES 1 - 2 Years

A. Advertise in Commerce Business Daily

1 B. Release RFP and Benchmark Package

C. Review Proposals

D. Conduct Benchmark-Tests

E. Request aest and Final Rids

. CoMplete Evaluations

G . Award. Contract

H. Settle Protests

I. Install New Equipment

TOTAL:

9 7

70 I

A
Benchmark testing an

stnne considerable time and

-Governmene, are not commoni

nizations. Furt"hermore, Fe

conduct.excessiveCompetit*

that substantially delay t

orientation is on prOcess

cedural step is overly acc

kibility for,results or get

Adding to the difficu

titude'of directives,- regu

the procurement activitt t . 7

. . Under the'Brooks A 'Ns vested with GSA, while OMB

fiscal and policy control.

line the process, 'no singl

to guide, -ADP/MIS ,procureme

ment,' Consequently, indi,

are left to make their ow'

policy directives. tor e

eh ncy to decide whe

acquisittpn at major,-whi

cedural steps. The inconsis

greatlyAiminishes coordinate

N ment practices.

test-settleMe , _ rces with i

t'Oed by

ncies

tratio

. Gen

lity

rath

b don

41 pro

polic

uteArlti

e assig

A'elef

ensiv7

the Fdde

cies atinI o

MB CiratIlla

to desi

ines.the

LOiiform''

r_ - Irregular acqUisition guideliries are';:dis

intra-egency procurement activities: jarisfhS

Congress partially.ele.917ted DOD from the Brook

re,q str

t i

GoVerstirty

partmen

.ariou'

A=r a 9 allows"

ekaOgiv.en

saquent ipr

AlD9

LOC

t by

enpctinq Section 908 of the DOD Ati,thori2ation 'for,.. 1982

topetmitstreaml-ining of DOD ADP procurement. p oc

However, DOD has nbt exercisedits Section 908 authority /

due,to internal disagreements on what hardware and software

should be exempt. Another example is the inabilityof the . AFLC to mddernize its ADP systems. The failure ofthe,

Advanced Logistics System,-.1aunched-in 10.0,!prOmpted

increased Cohgressional review of subsequentdata processing proposals. This has led to an overly.cautiOus attitude

throughout the command and a reluctance toAindertake new

modernization initiatives.

A further impediment to the sye msacquisition pro.:

cess is the lack of comprehensive pl ping and analysis

within the contracting agencies and dOartMents. oma,citcular A-109 calls for the fl.volVdMeht!of:top,-level management in determining agency mission needs and. goals, but

does not specify a planning and implementation process.

'The followirfg deficiencies are most critical:

9d
'User needs are not specifically incorporated in

relating acquisitions_ to agency mission and goals.;

Technical assessments of system requirements are

unde Ut4lized.

Altern tive means of satisfying mission needs are

not fu ly explored (i.e., purchase system components contracting out to a service bureau).

o Cost/b.,nefit analysis is not emphasized.

o Post-a quisition evaluation is neglected.

The .lack otcomprehensive-Iplanning in the Federal

.acquisition prNess-fosters the deploYment of incompatible

information systems. Many Federal systems cannot be

_interfaced'vertically.or horizontally to. achieve informa

4`tion flow linkages that would be. beneficial tor both ()Fieratio64111 efficiency and managerial decisionmaking. For

example, transfer program recipients' income tracked by IRS

computers cannot be cross-checkedvith eligibility requirements monitored by HHS computers even if all_ legal

'hurdles could be cleared (App

,In acquiring new systems, the Government has tended to

emphasize purchasing the technology over alternatives:such

as /easing.or contracting out to service. bureaus.' While,

the leasing option does not have the tax :advantages that

accrue to taxable private sector firmsr itdoes allow the

lesSee to utilize sta -of- the -art technology without

incurring:a large sun cost. Typically, Federal agencies

will wait until existing systems are on the verge of failure before attempting to jpstify a system replacement.

,Contracting out to service bureaus would also reduce the

risk .of technical obsolescence and may be-Suitable for many

Federal administirative functions such as payroll check pro

cessing. anp'company surveyed by the PPSS Federal Management Systets Task'Force charges between.75-cents and $2.00

er check to process.payroll. In contrast, the Department

f the Army spends about $4.00 per check to process pay- -

rolls using an outdated system (FMS 2). At'present, the

Federal Government does not explore purchase, alternativessufficiently.-

Conclusions

Considerably management weaknesses at al]-levels contribute to the ineffectiveness of Government :information

72
'9

systems. The lack of Central direction and leadership from

'0MB-underlies a Government=wide blurrthg of management

responsibility at the departMent and agency. levels....; The

general lack of accountability identified in PPSS-task

force reports extends to the directives to upgrade

information systems that perpetuate the information gap

problem.. As a result, imformati' flows within and between

ageniies are obstructed.

Managerial respon ibil -s need to be redefined 'with

respect to futureadeve o ment and integration of infaxmation systems.. Managers ld be accountable for their

performance in achieving specific goals rather than

following.a procedural routine. The key to implementing

cost-effective systems improvements is an Executive Branch

management structure within OM or the proposed Office of

-Federal Management that can in tit formal planning

practices across Federal agenci . t is imperative that

the larger.picture of interagency in ormation flows is

incorporated into the planning process. Responsibility for

ensuring that comprehensite planning and managerial

accountability are achieVid should be vested with a high

leyel information management coordinator within the

Executive. Branch.

The present Federal MIS and ADP systems are generally'. P' outmoded with :respect to GovernMent informatiOn systems

requirements. As various Government activities have

expanded and become more compleX,'systems capabilities'have

not3kept-pace. Outdated systemS are unable to handle not

.A Only agency tpecific needs,but;also interagency informa,

1' tion flows. Consequently, agenCy heads do notredeive the

kind of information they need to plan a a minister

effectiliely. , The production ofH.ncompl to and unreliable

information for daily operation's prohib tp further process -,

ing to adequately serve the specializ needs of decision

makers.

-A shortage of qualified data processing and systems

. development personnel aggravates and perpetuates the

problem of system obsorescence. :Deficiencies in training .

and supervision of personnel lead, to frequent breakdowns in

systems control 'procedures, whidh results 'in poor informa-'

tion quality.

Excessive tegulatory requirements and a'lack of

management commitment to systems formulation have created_

long delays in the acquisition prOcess. The present state

of inertia makes acquisiEions programs obsolete before they

get of the ground.:

73 100
//'

xi- Th'e many regulatory provisions and procedural' steps

affecting the acquAsition_probess should be reviewed and

simplified. ResponsibiliZy for estattlishing Policy, ex-e.rcising policy'directives and setting standards should be

centralized.4'Agencies should' be empowered to implement

, system modernization programs* a-comprehensive, policy

. framework.

kplanning prOcess to enstixe qualify information

dystems and to ttreamline the tequitition process is

essential. The probess should focus on'upgiading systems

hatdware and software to aChieve.agencyspecific.and

Government-wide information objectives cather.ttian_simply

focusingb.on the acquisition of equipment. This upgrading,

.must address.: . compatibility of systems within agencies at:a

minimum; '

, compatibility of file structures to facilitate

horizontal and vertical. itiforMation linkages;

utilization of common software;.

0

,

M

.A1

o establishpent of a software'clearinghouse to

facilitate sharing and"provide expertise; and

development of personnel planning ,to assure the

availability of skilled employees to operate and

design modern systems. t Many private sector fiims.and a few Government

ag'encies have implemented effective informatIon systems

thrbugh sell-conceived Lacguisition program. These pragrams combine spcific user needs with the overall needs' of

the fIrm.

Recommendations

INFO GAP-l: .Responsibility tor overall policy of

MIS and ADP systems management should be centralized 1.41 OMB

or the proposed Office*f Federal Management. 'Performance

measurement based on.achieving specific agency and' inte

agency objectives should be instituted.

tI

q.NFII'GAP2: Each a enc and de artmen

mit to 0.3 a 7111pg-range strategic plan. or up

matign systetr Budgeting. and management incA a uld

be directly tied-to performance and impleme

gra, lad).

1O
As shown DI Exhibit 11-2 on-thes,following page, the

plan should-identify the information needs of system users

(Managers., record,keepers, etc.) from the overall informa-

,requareinents of the agency,bt department. Frpm, the

needs%determination, a domplete technical assesim4ht should

conduct4 t6- develop alternative means of meeting tote

sytteM's functional requirements. The-cost/benefit analysis

-oflal'ternatives'.should-incorporate anticipated user needs

as well as current needs. Moreover, the potential for

utilizing information proceSsed by*the-syst.em sin Hatching

programs, in which-data linkages with other systems-is

required, should,,be assessed. After system selection and ,

implementation, a pdst-acquisition evaluation should be

made to determine system performanae in satisfying overall

agency and interagency information requirements.

(Exhibit I -2 on following page]

4 75

fl
Exhibit II-2 , SYSTEMS ACQUISITION FLOW SART

AGENCY/DEPARTMENT MISSION AND OBJECTIVES

4 .

1

I INFORMATION REQUIREMENTS

1

:

A

1

4

INFORMATION USER NEEDS. IDENTIFICATION

(FUNCTIONAL REQUIREMENTS)

iECORD KEEPING

'REPORTING "RODE ISOLATED DATA

AD Ha ANALYSIS OF DATA ,(

sPECITFIEl'AGGRIGATIONS OF DA1A

oIs

I

COST/BENEFIT ANALYSIS

'EVALUATION OF SATE) ALTERNATIVES IN RELATIONIORESENTJUNCTIoNAL

REQUIREMENTS , sCENARIO MODELLINGRELATION OF. ANTICIPATED NEEDSIO VERSATILITy OF ALTERNATIVE SYSTEM ). CuRRENIIND ANTICIPATED LINKAGES WITH OTHER SYSTEMSFILE STRUCTIL

COMPATIBILip

SAME AGENCY

( -,-HORIZONTALLY/YERTICALLY WITH OTHER AGENCIES

ti

INFORMATION SYSTEMS TECHNICAL ASSESSMENT

HARDWARE CONPONENT SPECIFICATIONS 'CONVERSION OF EXISTING SOFTWARE

-CONFUTING POWER -IN SANE AGENCY

- MEMORY CAPACITY -FROM OTHER GOVERNMENT 4qENCY . -PERIPHERAC INTERFACE CUSTOPI PROGRAMMINGIOEOUIRED 'RATE SUPPORT AND MAINTENANCE -EXPERTISE AVAILABLE IN AGENCY

-OUTSIDE EXPERTISE REQUIRED

(PRE-PACKAGED SOFTWARE AVAILABLE' OPERATING _SYSTEM

omARDwARE/SOFTwARECVAPATIDILITY

.INTERFACE WTIN OTHER AGENCY SYSTEMS J

IDENTIFICATION,OF SYSTEITER

SPURC E HARDWA OR CREATE SOFTWARE

"LEASE HARDWARE CHASE SOFTWARE

'LEASE HARDWARE /CONVERT OR CREATE SOFTWARE cOORACT OUT TO SERVICE BUREAU 5 CONSOLIDATE FUNCTION TIEH,OTHER AGENCY
-

, INEp GAP 3-13: Establis1 a software clearinghouse and

a technical resource center to promote the development of

compatible Information systems.

. I 0.

-Savings anti Impact Analysis

The cost savings, revenue and cash acceleratibn for

this issue, Information Systems, are-listed in Table 11-6,

,but -the dollar amounts reported ate duplicative of savings

reported previoudly by PPSS and are'presented here only to . provide the reade'r with a perspective -of the scope and

significance of the information gapprothem.- r.

. In reporting cost savings and revenues, the Project

)4

Team .has given each information' gap a primary-issue

ssignment, although many of the information gips are More

complex than any one problem area.. Therefore, when an item

is duplicated within-the Report, it 'is netted out so that.

the dollar amOunt'toi any single information gap is counted

only in its primary area. % The information gaps and,their related dollaramounts . are reported over three years. The table which follows

consists of three parts: two detailed pas, Section I and

Section II, and a consolidated totals patt7the .Summary, as

described below:

o Section information 'gaps which are speciically addressed in the text, of this

Section II: information gaps which are not

specifically addressed in.the text of this issue,

but_which the .Project'Team finds relevant to this'

issue.

o Summary: consolidated totals from Sections

and II.

Detailed discjssion of-these information gaps appears

in the Appendix to this. Report, which is contained in this

volume.

OP'

Implementation

The recommendations in this issue, INFO GAP 3,..can be r authoiized by the Executive Office of the President. These

recommendations also require action by OMB and would necessitate input from GSA.

[Table'II-6 on/the following pa ges]

77 1 03
TAdLL 11-6 : INFuRMArloN SYSTEMS 1/

Task Force

Issue Number Topic

Section 1:

8

Saving's (S)/Reimnue (10/Cash Accelerations (CA) 1/

($ millions)

Year Year Year Three-Year

the TWo Three TOtal

Information Caps Contained In This Issue

AG 2 Farmers home Administration . $ 178.0 ie. Management Information 18.5 -

USAF 13 ADP Modernization ' 4 . . 172.6 -, ADO 1 Feral. ADP Leadership- .,

4 HAW A Pension Benefit Guaranty Corporation 40.0

. - /

CUMMEI10E 5 Economic Development Administration 5.0

Debt Collection 0.5

USD 2 Improved inventory Mkiagement 288.0

to 2

44 Management Information Systems 145.0

ED 3 Student Loan Delinquencies 117.0

ENERGY 8 Multiple Accounting System; 3:5

Alt EPA 12 Financial Systems 1.2 HUSP.7 VA ikuipital -'Mls _ (150.0)

, . FMS 2 Executive Branch Information Systems

44 litiS-HCFA 6 Electronic paid Processnq

t 98.0

HHS7PHS 7A petit Mandqemenl 7.d

1(

liNS-SSA 3 1 HuU 1 mancLal ManaTlnent Systenu 22

882.') /'

.4 84.0

106

$ -, $i

- 20.3 22.3

194.3 113.7

. 44.0 48.4

5.9 5.0

1.0 1.8" 4,425.0 1,361.2

294.5 324.0

180.2 198.2

3.8 4.2

1.3 1.4

(55.0) t (60.5)

107.8 118 .5 7.1

1. 5 2.4 7.6

-97.3

92.4

107.0

101.6

$ 178.0 (CA)

61:1 (S)'

- 580.6 (S)

_ 2/

132.4 (10.

15.0

t(1)

6,074.2 (S)

763.5 (S)

495.4 (S)

11.5 (S)

. 3.9 (S)

(365.5)(S)

2/

' 324:3 (S) -et.

- 21.7 (CA)

4.6 1S)

222.5 (CA):

1.30

-278.0 (K)

292.7 (S)
. - 1-;b: 1111.URMATIUN SYSTE/IS (CUNT0) 1/

16# Savings (S)/Revenok (1t)/Chsh Accelerationst(CA) 1/ . 4..

Task Force Year' Year 7 Issue Number Topic g= one TWo

Year' Three

Three-Year

Total

Section 1: Information Gaps Contained In Ihrs'issue (Coned) 1 a 4 HUD 3 Debt-Collection Management $ 86.4 $ 95.0 ) $ 104.5 $ 285.9 (CA)

8.6 10.4 h 11.4 30.4 (s)

I

, umatim 9 Cash Mhnagement Improvements 38.0- 81.0 100.9L 219.9 (CA)

3.8 8.4 11.1 23.3 (S)

LABOR 1 Utfice of worker's Compensation 31.0 63.0 . 95.0. 189.0 (S) - - NAVY 8 Supply Inventory Management 66.6 66.7 66.7 200.0 (S)

PRUC 10 Economic Order Utientity 600.0 1,775.0 2,45.0 4,540.0 (S)

STATE 3 Heal Pr opr rt ye Management

V

TRANS 3 Grant Management 0 -48.0. 55.0 60.5 163.5 (S)

,.. TTM 4 liansportation Audit 49.9 54.9 60.41 165.2 (S)

. . Total. Section I Savings (S) $1,491.3 $7,305.4 $4,764.3 $13,561.0 (S)

Total Section I Revenue (m) 124.0 136.4 150.0 410.4 (R)

Grand TOtal Section 1 Savings and Revenue $1,41a4 $2. it $4.914.3 $13.971,4

Memo: Total Section I Cash Acceleration (CJ.) $ S36.9 $ 188.1 $ 218.0 $ 943.0 (CA)

Section Information Gaps Relevant To This Issue

ADP 17 111S Pruductivity Improvement

tpuSI, 3 Central Ilwlrh, Don 225.0 247.5 272.2. 744.7 (S)

Hubl, open' Market Purchases b7.0 73.7 81.1' 221.8 (S)

R ASSET 8 Cask' Management Incentive :;

2/

811SLPHS 2 Indian Health Servi.&.! '11.9 ,39.5 43.5 116.9 (S)

JUSTICE 5 ADP Systen

2/

107 m
v TADLL II- 6 INkUHMATlui stb-riss pun)/ 1/ . -Saving! (S)/Revenue (R)/cash Accelerations (CA) 1/

I : la:Mk; Force . j Issue' Hunter .TUV C Year one

($ millions) Year

TUo

Year Thiee

Three-Year..

Total

z

, 7 Selkil II: Infordation.Gaps Relevant To This Issue (Coned)

JUSTICE 6 Automated Leg:21 Suppprt System 10.2 12:3' 14.8 37.3 (S)

NAVY 13 Aircraft PowerOant Maintenance 5.0 5.0 5.0 15.0 (Si

Management

NAVY 15 Cash lieposiis -r; 3.3

qh

3.3 3.4 10.0 (S)

, THEAS 1 Collection of Delinquent Taxes 2}.0 25.3 27.8 76.1 (S)

THEAS 2 IRS Personni Additions S.

3/

TEAS-FURTHEN Bureau of the Mint 2/

sTuuy

Total Section II Savings (SI ) $ 367.4 $ 406.6 $ 447.8 $ 1,221.8 (S)*.tr

Total Section II Revenue (R) _ - - (RI

.,----,- , _ Grand Total Section 11 Savings and Revenue $ &LA $,Ilimi $ liZmi $ 1A2,214r

Memo: c*al section 11 Lash Acceleration (CA) $ $ $ (CA)

S.

10§

,c
a

TAl u -6-1 wommioNiresimmAani"DY1YSavings (S)/Revenue (Ri/Cash Peceleratians (CA) 1/

Task Force

P4115WIY,TOgr... Topic

Year

Ohe

($

Year

TWo

millions)

Year

Three ''

.' Three-Year\

Total

el ./."

Summarv.

. Consolidated Section I and Section II Totals

. , . Total Section hand II Savings (S).

Total SPction,I and II Revenue (RI

Total Savipgs and Revejue in Issue

. -

. Less Duplicated Savings 3/

Less Duplicated Revenue N/

Net Unduplicated Savings and RevenUe

Memo: To 1 Cash Acceleration (CA)

less4Duplicated Cash Acceleration

Net Unduplicated Cash Acceleration

. . $ 1,858.7 $ 7,712.0

124.0 , 1,36:4

:

- $ S.Rpt

N...

, '$14:782.8 (S)

410.4 cR) /i

$ 14.211a. $ 345:. $ 1A91%,3

$ . 536.9

.. , k 38:0

$ 2418 A1 $ 1.1fila.

$ 802.6

'$ 1.15.5212

$ 218.0

100.9

$ 15tala

$ 1,881.4

$ 2.14.211.12

$ 943.0,(00

214.9

$ 7334

$ 2A11.111.

$ 188.1 1 $ 4b8.9 107.1 $ 117.1 $ 723.1

_ Amounts in this Table repreSent duplicate cost savingsrevenue'and cash acceleration for PPSS, as these dollar

amounts were previously reported by PPSS.. These amounts include inflation and.are net of implementation costs.

2/__ Not guahtified.

3/ These amounts are claimed in another issue within the Information Gap report and are netted out in this issue.

All dollar amounts in the Ihformation Gap Report-duplicate savings previously reported by PPSS.
4. II. ISSUE AND RECOMMENDATION SUMMARIES (CONT'D)

A. 'PRCESS (CONT'D)

INFO GAP 4: INFORMATION UTILIZATION -- COMPUTER MATCHING

J

Issue and$avings

Can improved utilization of available Government data

through imilementatiOn of automated interagency computer

matching. result in significant savings?

Computer matching is an effective management tool for

identifying fraud, waste and abuse of Government benefits,

entitle0ent and loan programs. CoMputer matching is useful

in other way3, too, such as validating billings of large.

Government contractors.

. --------

,Recomffiehdationi in the task fPrCe reports to correct

infornation problems related to this issue provide oppor-'. tunities for cost savings. and 'revenue of $15.9 billion over

three years ($11.3 billion when informatian'gaps cited in

other issue's in this Report are netted out).

Background

The'Office of Management and Budget (OMB) Guidelines

(fssued.May 11,'1982) define compdter matching as:

a procedure iii.which a computer is used to compare two or more automated systems of records or

a system Of records With a set of non-Federal

records to find individuals who are common to

more: than one system or set. The procedure.

includes all of the steps associated with the

match, including obtaining the records to be

matched, actual 'use of the computer, administrative' And investigative action on the hits, .

and disposition of the personal records maintained in.connection with the match. It should

be noted that a single matching program may involve several matches among a number of

'participants.

82

110
Thus, a computer match includes the comparison of two

itsv sets of Federal records (e.g., Department of EducAtion,

.student loan defaulters with Federal peTsonnel records) as

well as the comparison:Of Federal records with non7Fed6ral

records (e.g.' Internal Revenue Servick (IRS) tax .r4turns

with local real estate records).,

OMB .has developed and promulgated .a series of guidelines and program models to assist Ekedutive agencies aid

departments in instituting computer matching projects that

comply with the Privacy. Act of 1974° and the Debt 'Colletion

Act of 1982.

The Privacy ACt of 1974 states that ",the increasing

use of cqmputers and sophisticat d information technology,

while essential to the efficient operations of, the Govern-'

ment, has greatly magnified the harm toindividual privacy

that can occur from any collection, maintenance, use, or

dissemination of personal infor-mation." The OMB Guidokines

-note that the Act--"makes any system of records from which

infokmation is retrieved using personal identifier's (such

) as name, Social Security number, or claim -number)'subject : t to its proviiions-and, by derivation, to those. of any

-.

;."b .supplemental.or implementing guidelines and instrOctions_ ,

' pertaining to t'he Act." OMB Circular No. A-108 proVides

guidance to Federal agencies for implementing the Privacy

Act.

The OMB Guidelines also address the impact of the Debt.

Collection Act of 1982 on the Rrivacy Act.- Specifically,

the Guidelines explain that the Debt CollectiOn Act:

o amends the Privacy Act of1974to provide a new°

general disclosure authority, subsection (b)(12)',

.which lets, agencies disclose personal information

to.consumer reporting agencies;

Creates a statutory authority.to satisfy the

.conditions establiOed by the Privacy Act whereby

agencies can make disclosures under subsection,

(b)(3) for a routine use." ThePrivacy Act

requires that such disclosures be compatible With

the purpose for which the information was originally collected. The routine use, disclosures

which the Debt Collection Act authorizes include

disclosures of taxpayer mailing addresses in

certain instances,.as well as disclosu,res of,

debtor information to effect adminiStrative or

salary offsets;

p.

83 111
creates statutory authority for agencies to collect the Social Security account number from

applicants in certain Federal loan prbgrams; and

a amends the Privacy Act to,exempt consumer reporting agencies from the "contractor" provisions-of.

the,Privaby Act.

Methodology e

A review of pvevio s studies:revealed numerous areas

where' computer' mat inc. has theAreatest Potential:for

identifying fraud, waste. and abuse of Government benefits,

entitlement and loan programs

Subsequent conversations with officials at OMB's Office

of Intorhation-and'Regulatory Affairs, the .PrISident's

Counci-1 On Integrity and, Efficiency, the General AcCounti*ng

'Office (GA0),, -and_the Veteranth AdministrapiohIVALrevealed

new Consideratioqs. while'supporting ,PPSS s earlier- fihdings.

-conversations were helM with the legislative aides of',

two members of Congress -who-have introduced computer match--

ing legislation regarding the Social Security Aftinistration (SSA) and theiIRS,

Findings

.Thefsuccessofomputer matching in ferreting out ; fraud and abuse is,demonstrated. 'Federal agenciesacross4the-board report 'extensive cost savings as a result

of interagency exchanges of-dat& regarding participants in

benefit and entitlement programs.- -For example,A11983

computer match of. Federal eftployee rolls and FoOd Stamp

recipients performed by the U.S. Department,ptAgricultare

(USDA) Inspector'General's chicagO auditO-Wf resulted in

the indictments -of seven persons for i114011y receiving

apProximately 41264142 in foOd stamps and welfare benefits

in Cook County. Three,-other persons were indicted4n Lake

County,. Illinois on 'Charges of receiving $84,,534±in illegal

food stampsand,welfare benefits.

`Other productive computer-matching prograMs-inclOde

the following:

o- The matching of delinquent student loan debtors

who aie Federal employees revealed almost 47,000

Federal empl!oyees with more than 50,000 loans

valued at $$7 ;7 million. ,

84.

112
,Project.MatchCompared Federal employee files

against theAi4 to. Families with:Dependent , 'Children (AFDC) and Medicaid files to determine,,

instances of Government employeeS receiving , ,welfare.benelfits improperly.. It uncovered

$300,000 in incorrect payments ij the'District

of Columbia alone.

Project Spectre, tnd computer. matching of SSA

beneficiary-rolls'with the-2Mealth Care Financing

.,4,:/!Administration's decedent rolls, resulted in the

teIrMinattpn of 5,263 persons from the program,-:

recovery of $7.6 million for SSA, and a savings

of over $25.2 million.

'c, 0# .:.'N

..' --qcu am Refugee Program detec ts fraud in AFDC,

., .' : ents to Cuban refugees.

;..

. 0 ect* Baltimore 'uncovers fraudulent use of

1,- OA 4A.,-security cards by illegal aliens.

.,_ ,t:,,,:e , 'I"..4N, 41.< r , . .C.. 4)rbect Sacramenta'finds AFDC'cases'where

''tkedipients are also receiving previously unreeotssA or Supplemental Security income (SSI4V

Ii S or haVe.reported false Social Security

'AFDC officials in order to obtain

There have been 29 indictments and 16

..tions to date: Mor than $250,000 in

Li6ulent. AFDC benefits have been uncovered.

Project Memphis, conducted, jointly with the USDA,

the Department of Houiing and Urban Development

(HUD) and the State of Tennessee, involves a

,computer,obmparison of the state's food stamp

MO and, USDA, and HUD wage reporting records.

To date,',1101 indictmentt and more than six Corivictioaqa've been returned involving almOsi $3.7

benefits.%

. o AfDC,Int'krjutisdictional Match, a matching program invb$4ing all 50 states, the District of

and Puerto Rico, has resulted in 20,285

%-sk- o Prbject Missing Kids identifies individuals who

, have created fictitious children in order to

receive AFDC benefits.`

o I.n Project Birthdate,.the computer scans the AFDC

eligibility file and looks for any family that

has twoor more recipients with birth', dates that

85 113
are identical to birth dates in another AFDC

family. Ineligible payments already total

0040D0 and there are 11.000 other 'cases awaiert.-

ing investigation.

Department of. Health and Human Services (HHS) computer

matching peOgramS which are ongoing at present include:

o IllogiCal Entitlement Situations - e.g., to

identify payments made after the date 5f. death:

o InValid Eligibility Situations - e.g., to identify instances where an individual is participating in the same assistance programin more

than one jurisdiction;

4 o , 'Overbilling - e.g., to identify billings from,

different doctors for the same type of service on

the..same day for the same patient;

o Duplicate Billings - e.g., to identify physicians

billing for the same services under multiple . provider numbers;

o Billings Exceed Norms -se.g., to identify doctors,

whose number of prescriptions for abusable drugs'

exceed establisheillnorms) and . o Illogical Billing Si,tioris - e.g., to identify

billings for inpatien hospital services when the

patient was not in the hospital.

Areas where Government officials-expect computer

matching to be most important in the'uture for Federal

agencies are:

o "up-front" verification of eligibility, also

called front-end matching, aimed at preventing

erroneous payments. Frott-end matching has a

.deterrenteffect and is consideYed to be less in

trusive than other typesof computer matching;1/

o recertification of eligibility to detect `changes

in eligibility status;

I/ Statement of Richard P. Kusserow, Inspector General of

HHS, before the Subcommittee on Oversight of Government,

Management of the,Senate Committee on Governmental

Affairs, December 15, ,082.

4.

86

4
improved debt collection';-

4 avoiding dUplication Of.13*nofits received by

individuals;

o validating billings of l*rge G4verinment

contractors; anal

locating hard to find absent parents, for the

purpose of establishing and enforcing child

support obli.gations, 6y matching with files not

normally used by the Federal Parent LOcator

Service, such as Food Samp's,'Slack Lung and

Federal license files.3 1

°While computer matching has become an ongoing Arocess

for some departments and agencies (HHS, is still a

"special request". for most other Government entities. W.D.

Campbell, the Acting Director of GAO's.Accounting and

Financial Management Division, discussed this aspect of

computer matching before. the Sehate's Subcommittee on

Oversight of Government ManageMent (of the Committee on

Government Affairs) on December 16, 1982. Kr.- Campbell

stated that several factors must be considered in deciding

whether a computer match should be on a one-time or ,routine

basis, including:

specific known or suspected cases of f or

error in a benefit program;

.whether computer. matching would be effective in

deterring people.from misrepresenting information

when applying for benefits;

Significant changes in legislative or administrative requirements for eligibility and payment: A

match could be a very economical means for determining whether required changes were correctly

made;

o the potential far change in an individual's

eligibility status. For. examle, changes-in

income or asset levels could OIange or eliminate

eligibility for a benefit payment;:and

3/

"Computer Matching Clearinghouse," U.S. Y Department of

Labor, Office of Inspector General, July 1982, Volume

1, No. 1, page 8,

Ibid., page 11.

87 11
o the acrequacy of the system of internal controls

in' W4nefit prOgram. If controls are judged to

be ak, a programAgould be more vulnerable to

error or fraud. A more frequent match might

therefore be in order until'the.controls are

st're,ngt,hened;

Notwithstakihg the obvious effectiveness of compute r

matching, numerous roadblocks hamper its use. Some of the

difficulties involve, the inadequacies of Government computer systets. For example, incompatible computer data and

systems thwart matching programs because many of the Government's 17,000 computers canrf-"talk" with one another

in order to share data (ADP 1). Efforts to improve this

incompatibility are Slow and 1-RsUfficient. Compounding this problem is the fact that no long-range planning for

improving existing computer systemslwith state-of-the-art

, technology exists. :This problem results in a failure to

anticipate future,needs And causes procurement of new

. systems to be fragmented (ADP 6 and 15)..

. .

. The q -ality of the data is often poor, makin' matching

difficult. The same data oftei are not collected oy.programs with similar purposes., ror examp,, entitlement

programs such as AFDC, Food Stamps, SSIi 'Medicaid and

SeCtion 8 housing do not'utilize the same data to establish

eligibility. 'Medicaid and Section 8 do not require Social

Security numbers as a condition.of eligibility (LISAB 4).

The quality of available data is often inferior because

it is untimely or lacks integrity. Outdated statistic's on

age and sex characteristics'of families leads to excessive

benefit_ allotments in the Food IStamp program (AG. 9).

'Similarly, inaccurate and fraudulent financial data prevent

HUD from employing computer matching to verify eligibility

for Section 8 rent subsidization beneficiaries (HUD 5).

The detailed and repetitive paperwork required to manually

match such non-uniform data systems impedes quick access

and delays computer matching programs (ADP 15).

A major roadblock to easy implementation of computer

matching is the fear of the governMent "Big Brother" concept. The IRS is hesitant to flgagg 'in computer matching

programs with other Government agencies. Officials fear

that sharing whatever data'is received from,income tax

returns and other sources may damage the present system of

voluntary compliance and reporting of income (ASSET 27).

In many instances, the IRS is the only Government agency that has accurate data on whichto initiate a match.

88

1
c. Congress also fears the -"Big Brother" concept.: The

background section of-thi,sAssue provides a listing and

description of legislation that affects computer matching.

The primary.,Jegal iSsue.that-jimits coitputer matching is

the Privacy Act of 1974,- which restricts the release of

personal information from agency:systems of records for any

purpose other than. that for which:the .informatiOn was

gathered. To accomplish. interagency computer matchigng, one

or more agencies must release information to other participating agencies. Each information release must be covered

by a Federal Register routine use notice, published at

least 30'days prior to the release.

The enforcement of the provision of the Privacy Act is

governed by OMB guidelines that 0 ace extensive administrative and operational requiremgn on matchinc" agt

cies. Each Planned match is requir:7- o be is i w1 c.1-1 cost/benefit analyses and t-o present alternative ways

accomplishing the project purpose. Comprehensisie matching

reports must be submitted to OMB, both: Houses of Congress,

and the Federal Registen at leait 60 days prior to conduct

of any.match. OMB review and,appro'val is required prior, to

perforning the- match. These legislative 'and regulatory

requirements have the net effect'of restricting'date to ,the

program. that collected it regardless of the relevancg of

related programs.,

The problem of comparable data appears difficult to

solve. For example, after three years of discussions among

Government automated data, processing manAgers, it has not

yet been posSible to standardize the input coding for the

male sex. Sone agencies use the numeral *1" todcode 'for a

male while Others use thg numeral "0." Obviously, a "1'

And a "0" are not the sameand would not "match" in a

standard computer match. Other basic data points that are

often incompatible include address abbreviations and Social

Security numbers.

TAs type of problem can be overcome by the timeconsuming use of a 'retrieval package.'" A retrieval

package developed by the Information Management Technology

Division of GAO basically lifts selected data considered

important for the proposed match from a donor computer.

The package records the data'in a compatible format with

'the receiving computer. For example, if.the donor:computer

codes a male as a '0" but the receiving computer codes as A'

"1", the package generates a new computer /file that trans-'-.

lates the ."0" to a,"1", thus overcoming a/technological

problem` restricting the 'match.

89

1 7
A final problem with computer matching involves a lack

of incentives to solve the'complex problems of implementation. In fact',',.a ajor disincentive exists. Ror example, there is a disinc htive for agencies to utilize computer

matching for,deb *collection purOos'es because the monies

cOlAsicted are credited to the Treasury Department and not _ the huccessful agencids' budget. On the oher, band, it---7

they)o'nOt, collect the funds'there is itill no effect on their budget. Menwhile, the total debt owed the Federal

Government has tdcreased 25 percent since 1978and delinquericies have risen by 38 percent (ASSET" 2).

Ccnclusions

CompUtgr matching works. It is the Federal Governmedt's most cost-effective4400l:fbr, verification or

investigation in the prevention And detection of'fraud,

waste and abuse. Indeed, *Richard P. Kussetow, InSpector. General of HHS4 declares_ computer matchin*to be "... a

most important weapon ilnthe crusade to-make government more efficient..."1/

Further opportunities to apply:computer. matching are widesetead and present in virtually every FederalAepartment agency. -. OMB's NCompendium.of Best Practices to Reduce Waste and Fraud,in Government Programs" recognizes

.that computer, matching is useful "...in a majority pf social service programs that have large recipient peolou47: c\'Iations." Computer matching i s'also useful, however, in

.,othet areas such as Government lending programs to businesses and individuals and in procurement programs. In

lending programs, prescreening would help to reduce the

number of additional loans to borrowers with poor repayment

records. In procurement prograins, identifying unsatisfactory vendors and .suppliers would prevent repeat business with'unacceptable business concerns.

Though there are sighificant s tural and-procedural

roadblocks, mach can be done to encourage computer matching

across-the-board. Familiarization of'department and agency

heads with the effectiveness of computer. matching and with

the procedural safeguards addresSing privacy concerns will

prove signifiCant in' fostering, increased use of computer

matching.

_ Kusserow, Senate Committee on Government. Affairs,

Statement.

90
The Report Team is,al,so,concerned with the privacy of

individuiiS', but questions the constraint 'of limiting data

to.the original, individual program or agency.. An alternate approach might include standard procedures to facilitate, ongoing matches across agencies and departments

grouped by program tripe rather than agency.or---departmene.

One possible program type thatinvolyesmore thanone

agency or department is "lending programs," which would

include the Departments of Agriculture and Education.

The current technological barrierS to matching are

more concerned with file structure inconsistencies than

overall'haraware incoApatibility. 'Modern retrieval

packages can overcome many data incompatibility problems.

At the same time, the major, data points utilized by

retrieval packages demqpstrate which data pdintS are most

:critical for a successful computer matching. In effect.i

those data points have b,eett isolated and shoure-be the

primary focus for data collection and file structure

standardsloof the future.

Recommendatio

INFO GAP -11 Standardize data. collection and file "1

structure codes for.basic data points such as sex, street.

abbreviations and Social Security number.

INFO GAP 4-2: .Identify. programs with high potential

for fraud and abuse by program"type rather than agency

responsibility. "Program'types* should include lending,..

dietary subsistence, assistance to individuals'and Gov =ern -

ment contractors. :Require a common identifier as a condition for eligibility:(i.e., Social Security number).

INFO GAP 4-3: Familiarize program.managers and other

,witn.the advantages, of computer matching.

INFO: GAP 4-4: Explore requiring front-end scr ning

in determining eligibility for loan, grant and entitlement

programs.

Savings /Iand Impact Analysis

, 4e

The cost savings, revenue and cash accelerations, for

this issue, Information Utilization -- Computer Matching,

are listed in Table but.the dollar amounts repOrted

are duplicative of savings reported previously by.PPSS and

are presented here only to provide the reader with a perspective of the scope and significance of the information

gap, problem.

91 i!9
itt

In repcirting cost savings and revenuesi, the Project

Team has giver each information-gap_ primary issue

assignment, although many of_the,inf rmation gaps are more

complex than any- one probleM area'..;v herefore, when 'an item

is duplicated within the,Report, it is netted Out so that

the dollar amciunt for any ,single ,informition gap is_ ounted

. only in itspmmary area.'. .

,_.

. . The informatiOn gap and their related dollar, amounts

are reported over three yearsThe table:which'follows

consiSts of,three parts: two detailed parts,,Section I and

Section II,. and a consolidated totals part, the Summary, as

described bel.cm! .

. -4.. , . o Section I: information gaps which are/

spegifically,addresSed in the.text of thiS issue. .

. , -, ,

, , Section II: itifOimation gaps which areqlot ..,

, specifically addressed in the text of this issue,

Out,which the Project Team finds relevant to this . issue:

Summary: consolidated totals from Sections

and II.

Detailed discussion of these information gaps appears

in the Appendix to this Report, which is contained in this

volume.

Implementation

The recommendations,in INFO GAP 4-1 through 4-3 can be

authorized by the Executive Office -of the President and

Would necessitate input by OMB and the General Services .Administration. Recommendation,INFO GAP 4-4 will require

Congredsional action.

[Table 11-7 on the following pages]

9 2 120
IA: 11- 7: INFORMA'r fur+ UTII.ILA'C1ul4 MATCHING 1/

Savings (S) /Revenue (8)/Clash Accelerations (CA) 1/

($ millions)

N % , Sk ior.ce Year ',Year Year

Issue Number Topic trite 144_ Three

ihree-Year

Total

,Section 1: Inforrnatin Gaps Contained In This Issue

AC 9 AFDC Outdated Statistics $1,439.0 $1,142.9

.DP 1 i o 17,000 Computers Can't Talk ret

Airy b Office Alt....Tation 339.0. 2,211.0

. . ADP 15 Claims and Benefits Autumition

ASSET 26 Debt Collection 600.0 2,200.0

60.0 286.0'

ASSET 27 Intethal Revenue Service RefumS Of fset 641.6

511.3 128.3

HUD 5 Benet its .Elicjibil.ity 565.0 621.5 4 LISAB 4 Income Ver it iwt ion 667.0 745.9

$1,257.2

A 3,987.0

, 5,300:0

'844.6

,705.7

211.7

683.6

844.6

$ 3,439.1 (S)

2/

6,537.0 (5)

2/

. CI 8,100.0 (CA).

1,190.6 (S)

1,930.5 (CA)

39B.3' (S)

1,870.1 (S)

2,257.5 (S) :

I Total Section I Savinys (S) $2,728.3 $5,135.6

Total Section I Revenue (H) .- -7 $7,8.28.7 $15,692.6 (S)

(H) N... Grand Thtal Section I Savings arid Revenue 447 .31 . 41135.6'`_

1 14sna: Total Section 1 Cash Acceleration (CM' $1,183.1 $1,841 .6

,

. Section 11: Information Gaps Relevant To This Issue

$7.828.7

$6,005.7

45,692.6 (S)

$10,030.5 (CA)

ADP lif 'IRS Productivity Imptovemvnt.

ED 4 Contracts and D :icretiorury Grants $ 132;5 $ 35.7,

LISAti 9 Medioa 1 Qua I ity Cont rol 4

$ 39.4

r-

. ,,, / y

$ 207.6 (S)

Yid t

Total Section II :;avanqS (5) $ 1 32.5 $ 35.7

Tutd1 Si!ellon II 141vi4lui (H)

.Grand Total SiCt 1 on 1 1- v IV); i .11t1 RIvo..nut $ $

Mciao: Total tun I I Gish Acc1_,101 $ $

$ 39.4 $ 207.6 (S) - (R)

$ Jc L4

$

it3246,

$ - (CA)

121

0
Task Force.

(,issue Numbex

TABLE 11-7: N rui*Wr ItiN UTILIZATION

S

r

CP -4 OUMPUTEli MATLIIIING (CE)NT'0) 1/' 1 savings (S)/Revenue (R)/(11WIAcceletagices (CA) Al

.($ milliOnS)

-, rta r Year Year Three -Year Topic One I4ru ' 'Three Total

. Summary: Consolidated Section 1 and Section II Totals:

Total Section I and IISavingSNS)

t

Potal Section I and II Nevem (R)

i natal Savings and Revenue, in ssue - Less Oliplicated Savings '3/ 7 , !-1.;:.- .. '4t;;,_ Less Duplicated Revenue: 73/ r- i..,

-,:7-s

. . .1,A*..110. AP ..z... Net Unduplicated Savidijs arid livert)g,i,-"..tr .",

'

. ".%,1 - '..""f. Aemo: Total Cash, Acceleratiore (kik) ' 0.; _ -.

. -. ... Less Duplicated E.Ssh'..46cVleratjgiON.----;:,

,-; . Net Unduplicated dish) Accce)t0 toil .

., J

1112060A $ 5;171.3 . $47,868.1 . r15,900.2 (S)

(R)

zjaut $ 2,1716.1

$.4,099.0` $ 1,4243.9

$ 28168A1

$ 2,101.8

$j5.900-.2 (S)

$ 4,629:7

- $ 471141- $ .112.4. t $'.44i§11 1 11.270.5,

s t , $ 1,183:2 4 2,841.6: , $ 6,005.7 $ 10,030.5-

6110.I1 2 ARLO, 5 LM.LO 0 8,100.0

$ S83.2 $' 64L.6, 705.7 $ 1,930.5.

Amounts in this Table:;6present duplicate cosf$4.yings, revenue and caiiti acceleration for PPSS, as these dollar

'amounts were previously.lieporteckgby,pFSS. .-TheStf.:anyaunts include inflation and are net of implementation cost.

,. $4,,4V, 4.. ..4:-:;; '"' Not guantifled. ::,-', -,)' ' 1/4,,.-1 ..n. ' )4 '.. -':-- kat: 'Cs. .

1, . ,,0. !,4e..k.'..% .: .w,'..; These amoUnts- are claimed in another isSionri;wthlni-the Infornation.Gap Report and are netted out' in this issue. .7r All dollar amounts in the ".Informatige Gap Ryii,qt- duplicate savings previously reported by PPSS.
NpATION.S9NNiRIES

: 7 B. .STRUCTURE,,

6 i

? 7 1

INFOCOv$: .A.STRUCTUFE TO FACILITATE THE INFORMATION

MANAGEMENT PROCESS

Issue and.,pavings'

How"can.7the overall informatCon-management process be

strengthened/to provide both an effective and' efficient ,

informatkon/madagement process.in the /Federal Government?

-.A star cturi is necessary to_assve that the infosmation:mana ement "process mcommended in INFO. GAP Issues 1-4

functions pr,o.perly -

. ReommendatiOns" ih the task force reports. to Correct

information problems related to this issue providl opportunitit,ek for' threei-year'eost. savings and revenue. which'

total $l9..0 billion ($9A .billion when infRxmatiOn gaps

previously cited in this Report are netted .out).

. _ Orgvizations

_-have Communication and reporting channels,.commonLy call structure, to facilitate the desired

processes of'the oti%nization and to institutionalize the

pr,ocesses as a part of the culture of the organization.

Common elements Of structure include levels of authority

and respOnsibiLity, training and staffing levels, codrdi- ,"'

/nation and lia-},son functions,,Tules and procedures, and

/incentiviprograms. These elements may be adjusted in any

//possible

combination cause an Organization's-members to

emphasize:different-Ptocesses.

This concept of organiZational, structure has been long

recognized'in the management literature.'. Organizational

',theor*st Mason Haire summarized the concept as 07What gets

measured gets done." By measuring somethkg, it. focuses

attention on it and people respond.1/ Wheff_a b6siness

. Thomas J. Peters'andRobeet H. Waterman, jr.,-In

Search of Excellence' (New Tork:" Harper and Row,

Publishers: 1082), p. 268. Ipow

**" 95
changes its:blisinesa strategy', it often will elect to. make

:-SEructural changes to fociis attention on the new buSinesS

plan. ..7-For example, a' business which reaches product/market

maturity (a period of slower growth than a previods period)

Would most likely shift to 'tighter budgeting and.. stricter

controls, and would alter:the incentives systems to get- _ managers and employees to conCentrate more carefully on

cost. controa.since sale are no longer expandingLas rapidly

as before. These shi totdifferent m asutes Sch IS

tighter budgets are s _ctural,changes idh-serve focus,

the attentionof theAtOikers.,inan.organiationon new

goals.

. Methodology , In analyzing the structural pro leMsthat pede-the:

improvement of management informatiOn,. the f011 wing

_ sources were utilized:

o, review of the PPSS task forte and selected issue

reports of.which 23 contain information gaps

relevant to this issue;

'-

aks o' review ofSelected general business periodicals

and publications; and . o discussion with PPSS task force members.

'4 ' Findings

14% Interagency and interdepartmental structural impe44.-

ments produce a leadership;i'mid-Ininformation'management.

Communidation of information,amon?.and betweenExecutive

Branch agencies anddepartments is haphazard and,diSjointed- As a-r4sult, Government decision makers are.often _ faded-With-7feast or faMine" when it tpmes to information

availability there, is either too much- or not enough

information for informed, rational decisiovmaking.

There are four basic structural reasons for this in-'

.-formation gap at the interagency and interdepartmental.

level. The'frst cause is overly decentralized structures,

for example:

o Even though virtually every Federal agency .and

department is invqlved in-personnel traveland-'

tran'sportatfon, thereiis.no,centgal clearinghouse

for' f.nformation concerning routes, rates travel

and hotel discounts -- either within

96

124
agencies and, departments or Government-wide..

This lack of information deprives the Government

of volume discounts, tilus'increasing Government

travel costsiTTM 1).-

Government freight tta is management systems are

not adequate to gather consolidated Governmentwide shipping data -- thus the Government cinnot

take advantage of its significant freight traffic

volume to earn-discounts (TTM 3).

t

Information gaps are caused by overlapping structures,

too. Responsibilities for property, financiAl management,

human resdurces and automated data processing (ADP) manage

,pent are shared among Executive Branch agencies. Thus'? no

single department or agency is solely responsible.for overall Executive Branch administrative direction and policy

setting in these areas. For example,

o .Property management.. The Federal ProPeity and

:Administrative Services Act of 1949 created the

General Services Administration (GSA) and

.assigned_the Administrator authority to "pre- . scribe policies and methods of procurement," In

1974, hoWevet, the Office of-Federal Procurement

Policy was established within the Office of

Management and Budget (OMB)- (P.L. 93 -.400) .t =o

provide "overall direction of procurement'policy

..--and-prescribe polic4es-,----regulations-,--pxoceAures, and forms." In real, property disposition,

the Federal Property and Admihistrative Services

Act requires the GSA' Administtatof to "prescribe

policies and methods to promote the maximum

utilization of excess property." Executive Order

12348 established a Property Review Board to

"develop and review Federal real property acquisition, utilization and disposal policies with

respect to their relati hip to other Federal

policies."

0 Financial management. Responsibilitieb are

shared 'by OMB, Treasury and GSA in the Executive

Branch, and the General Accounting Office and the.

Joint Financial Management Improvement Program h,

the Lqgislative Branch. No single organization

A.s- responsible fot establishing Federal,fipan-'

cial management policy ordcoordinating activities.

The impact of this fragmentation -is a lack.of

focused attention on major opportunities for cost

reduction and management improvements (FMS 1).

,- 97

1 `(:),.5
o Human resources management. Responsibilities are

shared by the Off-J00e,of Personnel'Management

(OPM), departments and agencies, and OMB. OPM

provides primary policy oversight for Government-.

wide civilian personnel activities. Agencies establish positions-based on OMB position controls,

and -hire and train personnel for those-posi-.

tions. OMB focuses on position cot.rol and not.

on other elements of hu resourdesrManagement.

o 4 ADP management. The Brqolpseeill of 1965 assigned

to GSA the responsibility of managing ADP acquisitions and promoting shaking among agencies.; to

OMB, the responsibility to provide "policy-guidance to promote effective, and economic application and utilization of ADP equipment mid to

evaluate ADP management performance;" and to the

National Bureau of standards in the Department of.

Commerce, the development of uniform Federal ADP

standards. The Paperwork Reduction Act of 1980

assigned OMB the responsibility for "developing

and implementing policies, principles, standards,

and guidelines for automatic data processing and

telecommunications ... and overseeing the

establishment of standards."

The impact of this fragmentation is a lack of focused

__attention on major_opportunities for coOk_reduction and.

management iMprovements (FMS 1). In contrast to the Federal Government, management practice in the seven corpora -

tions reviewed by the PPSS Federal Management Systems Task

Force fouvid that-imalLcases, authority for adminittratiVe

functions was centralized in the corporate. headquarters in

one specific office.

Inconsistent rules and standards add to the infOrmation gap problem, too. For, example, when the Department of

Justice attempts to collect debt for other Government agenCies, lack of uniform accounting forms and definitions

pievents effective debt receivables management. Government,

agencies db not agree even as to what constitutes an

overdue account (JUSTICE 1). --- i

7

he absence of interdepartmental coordination, and coordination,

liais n is the fourth fundamental factor contributing to

the information gap problem. Credit information on a - Government-wide basis is not timely, accurate or complete

even though the Government's direct lending activities make

it one of the Laigest banks in"the world. There are no

Government-wide statistics on default nor do departments

98 12
share information on credit-worthiness (ASSET 12). Similarly, there are no procedu-res for the DepartmeOt of

Defense(DOQIJ the Veterans Administration-(VA), and the

Indian Healer SerVice to identify patients with dual

eligibility for health care programs. Thus, about 20

percent of claims result in duplicate or erroneous payments

(HOSP 12).

Structural problems are not limited to the organizational structure of the Federal Government as a whole.

Underlying and contributing to the Federal Government's

process problems. are. structural deficiencies within the

individual departments and agencies. PPSS task force

reports reveal information gaps caused by intra-department

and agency structural deficiencies such as,a lack of

coordination, inhibitiVe and insufficient rules and.

_procedures, poorly established areas'of responsibility and

accountability, inadequate training, .and an absence of

incentive systems.

One example of a structural information gap caused by

a failure to coordinate activities exists in the litigating

divisions of the Department of Justice (DOJ). DOJ does not

employ a comprehensive systems approach to litigation management so that Department resources can respond effectively to fluctuating litigation demands. Instead, each division-is currently developing its own case management and

litigation support system without regard to the hardware

and software compatibilities of other divisions. This lack

of divisional coordination results in duplication of-effort

in attorney and programmer time, and non - uniformity of data,

which cannot be aggregated for reporting or management

purposes (JUSTICE 6).. Other coordination failures lead-to'

inforMation,gaps'in the Department.Of Labor and DOD.

Productivity Measurement and ImproveMent within

.the Department of Labor_is not:usefuljor performance appraisal dde to an insufficient management

information system. 'Underlying this, however, is

the lack of an,organizational mechanism to pro- . vide liaison among agencies (coordination), to

encourage management support, or to assist in

offering technical advice about the implementation and evaluation'of such a system (LABOR 4).

Engineering.is not cost-effective in DOD raboratories. The problem stems from insufficient

dissemination of infOrmation on emerging technological developments to apply to the appropriate

phases of the weapons acquisition process. Contributing to the .problem, however, is a sttuc99 127
I tural deficiency relating to poor organizati4a1

coordination. Akio centralized, coordinated effort

exists to disseminate the emerging information

(OSD 19).

Rules and procedures can be either insufficient or

inhibitive to the inforpation management process. For

example, Federal food service programs are not monitored,

resources are not effectIvely_deployed, and funds are .

commonly duplicate4Y:priadirected. The problems stem from

the lack of managemenyinformation.systems as well as of

budgeting.and cost accounting systems for detailing Federal

feeding functions. :In!addition, there is a management goal

orientation that feeding 'is a secondary role in the operations of Federal agencies and departments; therefore, th

receive'secondary management attention and focus. Undet

lyincrthisorientati4n,:'however, is a structural deficii

insufficient nsufficient rules and rocedu-res. No, single,

comprehensive Federal feeding policy currently exists

.(FEEDING 1). Similar rules and procedure problems exist In

GSA, 'DOD and the Public Health Service (PHS).

0. GSA is not effewtively managing its leases- and

acquisitions due to an untimely,.inatcurate and

unreliable informatiOn system. Underlying these - problems, however, aresteuctural-deficiencies

involving inhibitive rules and procedures that

focus on process more than results.

o Inventory control, in DOD is lacking due to incom

patible inventory data systems and an outdated

ADP system. Yet underlying this equipment obso-.

lescence is a structural deficiency involving ADP

procurement procedures, which are time consuming

and inefficient. Consequently, local management

tries to make do with the outdated system. As a

result, inventory management decisions are

'sub- optimal, stocks are not balanced and there is s often excessive stock build-up, unneeded inventory

investment, and excessive obsolescence (OSD 2).

o Delinquency rates on debt collection at the PHS

in the Department of Health and Human Services

(HHS) have become excessive, principally because

of the lack of an information system to monitor

and control billings and receivables. Yet

underlying this are structural deficiencies

iyolving insufficient rules or procedures in the

fihancial accounting area (HHS-PHS 7A).

100

12d
In many instances, the ba'sic data needed to provide

.the necessary information exists in the organization, but

because responsibility, authority' and accountability for

the informatio* 14,poorly defiped, it' does not reach the

decision maker in the propei. manner. For instance, the

collectibility of past due loans-at-the Small Business

.Administration is jeopardized by the lack of timely information on past due loans. Contributing and perpetuating

this problem is a structural deficiency :involving insufficient designation of accountability for information Among

program officers (SBA 2). This kind of- accountability

problem is notlimited to SBA and is apparent in the

f011owing areas:

o Federal fleet management differs in quality from

agency to agency and is often duplicative,*result,7

ing in-unnecessary expenditures for facilities,

vehicles and equipment. Much of the problem stems

from an inadequate, centralized 'fleet management

information system. Yet underlying this problem

are structural deficiencies involving t-he insufficient designation of responsibility/authority/

accountability for fleet management information

as well as the lack okimotivation for identifying

or solving the probler (LAND 2).

o The Department of Hou-Sing and Urban Development

(HUD) management la&ks information to gauge program activity and effectiveness. Cofttributing to

this are structural problems involving insufficient designation of responsibility /authority

accauntability for the information as well as

inadequate coordination. No one area of Hup is

given responsibility and authority fogetordin

ing and developing Department-wide fin ncial

systems (HUD 1)..

o Maintenance management practices in Navy aircraft

power plants are ineffective and inefficient. The

problem results from inadequate engine monitoring and component removal information systems.

Contributing to these problems, however, are

structural problems involving insufficient designation of responsibility/authority/accountability

for maintenance information among program managers

as well as poor coordination between departments

in' the work planning process (NAVY 13).

o Federal construction management efforts are experiencing schedule delays and cost overruns.

_Contributing to this problem is an inadequate

101

cleat
management information system that concentrates

on financial data rather than the physical status

ofconstrUction and related activities. 'Underlying thiso.Mowever, is a.structuril deficiency

imalvingan.insufficient designation of respons-'

ibirity/authority/accountability for the required

information.. There currently is no single indi7

vidual accountable and responsible for pIannidg,

organizing,- staffing, directing, controlling and

leading each Government construction project

(CONST 21).

o The Department of Energy .is hampered in managing

agency operations, largely due to incomplete, . outdated and inaccurate financial reports. Yet

underlying this is a structural deficiency

involving insufficient designation of responsi-

.bility/authoritY/accountability to ensure that

the information policies are implemented

(ENERGY 8).

o There is a lack of control in DOD,over Governmentfurnithed material requisitions, which ha4 led to

an abuse of the program. Contributing to this

lack of controlllis the lack of an information system and auditable record of Government-furnished

material transactions. Yet underlying this is a

structural deficiency involving the lack of specific responsibility/accountability/designation

for the program as it is processed across

disparate maintenance, supply, procurement and

contract administrates functiohs (OSD 39).

o The Fe deral ProcureMent Data System lacks key

information regarding consulting service contracts. The results of this information gap are

exhibited in the Air Force's procurement of consulting services, where too many contracts are

sole-sourced and too often based on unsolicited

proposals. Further results indicate that duplicative and Irrelevant studies are commonly authorized. The underlying cause of the information

problem involves structural deficiencies relating

to the lack of clear,c.41_authority to impose and

enforce a system of controlyover Circular A-120

procurement (USAF 22).

Another key area of structural deficiency noted in the

task force reports involves poor training and/or employee

staffing of operations. If the staff is unable to properly

102

130
utilize or dissemihate%information, an information gap can

easily arise. A case in point is the unacceptably high

rate of delinquent'recivables at the Environmental Protection Agency. The problem results from an inaccurate and

untimely financial information system. One of the reasons

the system is inaccurate and untimely is that employees are

insufficiently trained to use the,system. The system is so

complex-and employee.knowledge of the system so poor-that

,many employees avoid using the system (EPA 12). This type

of training-related information gap occurs in other

agencies:

o Inventory losses in the Navy are excessive due to

an insufficient inventory information and control

system. Underlying this are structural problems

involving insufficient designation of responsibility/accountability, as well as the assignment

of inexperienced, insufficiently trained officers

to supply centers (NAVY 8).

o Thereis a lack Of control in the Federal Hospital System over duplicate or,erroneous payments,

otind as a result some 15-20 percent of all VA and

+&S claim; e0ult in dUPlicate or erroneous pay-

.ments Underlying this problem is lack of

knowledge on'the part of contract health officers.

about authoiization procedures (training) as well

as a lack of incentives at the program level to

initiate cooperation (HOSP 12).

The Department of Education is experiencing many

cases of waste, fraud, abuse andiPerror relating

..to the disbursement of funds for Congressionally

, mandated educational prograips. The problem relates to a weakness in the Department's management information systems and internal controls as

well as a goal orientation among officials to

-disburse the funds promptly. Yet underlying

these weaknesses are structural deficiencies involving staff shortages and undesignated responsibility for internalontrols (ED 2).

The ColleCtion Division of the Internal Revenue

Service is suffering from a record level of

delinquent taxes. The problem relates to an

ineffective information system. Yet contributing

to this problem are structural problems involving

understaffing and the inefficient deployment of

professional staff to other duties (TREAS 1).

z

103

100
Well-mana ed rivate sector firms have 1 n- reco nized

that different oalt and strategies require different

structures laijista.SiIt_systems to get personnel to adapt

Idtslortiveotoarf such goals. Forte example,. a firm

that choosesto pursue a strategy of overall cost leadership would use a different incentive structure to motivate

its employees than a firm that pursues a strategy of differentiation of Products. The overall cost leadership firm

would emploY.an- incentive system based on meeting strict

quantitative targets whereas the_ differentiation firm would

use'subjective measurement and incentives instead of quantitative measures.,./

When General Electric (GE) decided to alter its strategic planning system in the early 1970s from a decentralized functional Planning model to the strategic business

unit (SBU) approach, the measurement and retard of

managerial performance was also changed. Previously, GE

had compensated managers on the basis of residual earnings.

To ensure that managers acted in accbrdance with the SBU

system, SBU managers fn different strategic sectors of the

business portfolio were measured and compensated

4ifferently.2!

Illittsledlsralgovernment, there' are few incentives

for the improvement of information management. Indeed,

there are si nificant disincentives. One such example is

the billions Of dollars in interest expense the Government

incurs unnecessarily each year because of ineffective

accounting systems and cash management practices. One of

the reasons the Problem persists is that no incentive

system exists among agencies to improve tJeir practices.

In fact, an incentive exists to continue thellpad practice.

That incentive rests with the fact that the Treasury traditionally pays all costs of money within the Government,

whether or not it is the agency requiring the disbursement. The agency that manages its cash-poorly and causes

the Government to incur higher interest expenses is charged

nothing for the cost of its mismanagement. But, if the

agency wanted to upgrade its system, the agency would have

to pay the costs of acquiting and opwating the new - system

(ASSET 8). Consequently, it is "cheaper" for the agency to

2/ Michae. E, -porter, Competitive Strategy (New York:

The Free press, 1980), pp. 40-41.

2/ William:K. Hale, "SBU's: Hbt, New Topic in the

Managementoof Diversification," Business Horizons

(February 1978): 17.

104
continue to mismanage its cash. Additional-structural

incentive problems leading to information gaps follow:

o The total debt owed the Federal Government has

increased 25 percent since 1938 while delinquencies have risen by 38 percent. There is little

incentive for agenctes to collect debts becausethe monies recovered are credited to the Treasury

department and do not-affect the agencies' annual

appropriations (ASSET 26).

o The-D artment of Labor's management information

syste s dopot produce the information needed to

evalu to the performance of individual eMiploy-'

ees. Therefore, comparative data are not available and there-is no incentive for productivity

improvement (LABOR 4).

o The Goyernment does not,set user charge prices or

manage receipts so as to maximize productivity,

cost recovery and program efficiency because the

a existing budgetary accounting system acts as a

disincentive for the efficient collection of user

charge receipts (USER 1).

o Productivity in completing in-house maintenance

of real property is substantially below private

sector standards because there are no incentives

for cost control and efficiency (PROP 6).

o The Office of Student Financ Aid in the

Department of Education is inef tively managing

and controlling the debt collectio of student

loans. The problem stems from the lack of suitable information upon which to base judgments.

Yet underlying this are numerous structural deficiencies involving lack of incentives, insufficient training and inadequate procedures at the

institutional level (ED 3).

o The VA Office of Construction bases major planning decisions on insufficient information, resulting in the authorizOion of potentially

wasteful projects. Contributingitto the problem

is a poor assessment of the information needed

for construction planning. Yet underlying this

is a structural deficiency involving the lack of

incentives for improvement (HOSP 5).

o The VA exhibits poor administration and financial

controls as well a1

a lack of planning as it

105

t.,1. iaa.

41'
relates to hospital purchases on the open market;

contributing to the problem is an insufficient

procurement data system. Yet underlying these

'problems idthe lack of ad incentive. system to

encourage more efficient management (NOsp 9).

Conclusions

The purpose of structure is to facilitate process and

to institutionalize the process as a part of the culture of

the organization. The primary variables of structure are

levels of authority and responsibility, training and staffing leveld, coordination and liaison functions, rules-and

procedures, and incentive programs. These elements are

often not present, or they are poorly utilized, in the

Federal Government. As shown in the Findingi section of

this issue, these structural failures impede the flow of

useful and needed Management information.

When a new focus or process is desired in an organization, the structure 4f the organization must change to help

the organization ,break out of its former way of doing

business. In the private sector, a business that reaches

product/market maturity would most likely shift to tighter.

budgeting, stricter controls, and new performance -based

incentive systems. Different management variables such as

accounts receivable might become more important than they

were prior to reaching maturity.i/ These shifts in focus

require new organizational structures to promote the change.

In the early 1970s, GE altered its approach to strategic planning. In order to ,institutionalize the new type of

strategic thinking the firm desired, 'GE found it necessary

to realign the structure of the entire brganization. GE,

one of the best, managed firms in the country, made the

shift because of the belief.that strategy implementation

dedisions will be made only managerial selection,

approval, and incentives are cOsistent with the strategy

and with the planned results."_ !

To achieve the needed focus'on an information management process, structural changes in the current system at

0 Michael Porter, Competitive Strategy: Techniques for

Analyzing Industries and Competitors (New York: The

'Free Press, 1980), p. 250.

.4/ William K. Halle uSBU4: Hot, New Topic in The Manage-

-\ ment of Diversification.," Business Horizons

-(February 1978): 23.

g.t 106

1,a4
../1-"""'"' ,

ib. D both the-Executive Office of the Presteent '(EOP) level and

within the individual operating unitslnust be implemented.

f, . This new structure would allow for the:

monitoring and mantgeient of information flow;

o coordinStion of the needs of the different levels

of management decision makers;

o required leadership insetting quality standards

on common information needs; and

o signaling to all managers the importance of the

information management process.

The needed structural changes require both table or

rigid adjustment and a shift to provide a flexi -lmost

entrepreneuiial function to oversee the flow

tion. Consequently, the information_management s

needs a top-down focus from OMB or the proposed Of f

Federal Management-to provide consistency with the goals of

EOP and individuals in each department and agency, and to

provide 'hands-on" assistance to departmental leaders in

overcoming the process roadblocks to effective informationflow.

The "stability" structural function would supply the

_ needed leadership for Government-wide standards on

applicable critical success factori, such as the aging of

debt to improve Government-wide managemeht of accounts

receivable. This organization would be in-EOP and could

include S Government Accounting Standards Board modeled on

tile-private sector's Financial Accounting Standards-aoard.

- The more flexible, structural fdnction, or "entrepreneurial" function, would be of a.problem-solvkng-tYpe. . . This person would be held accountable for finding out which

processes do not work and why they do not work. To

continue the accounts receivable example,'the entrepreneurial function would be coxcerned with whether the

problem is possibly an imprner data collection process, an

antiquated computer, or staff persons who are improperly

,trained to run the system. The focus would be on seeking ,

agency and departmental solutions. . The Project Team does not intend to suggest that this

structura shift should try to get everyone on board about

a definition of a.critical success factor before any"change

goes forw rd. Instead, the components in this structure

are to focus on incremental, ongoing improvements. Once

again, the accounts receivable area.demOnstrates this

point. The first major study of the problem was conducted

107 135
in_1940. To date n-late 1983., Government departments and

agenci4§ still have not been able to agree on a point in

Si=;414k time at which uncollected debt is delinquent. Massive new

computers and forms require years of lead time. What is

; needea is a 'hands-on' fdcus to clear the roadblocks and

;.$'41eadership, Voids now.

Recommendations

The -Project Team recommends that the two structural

elements needed to facilitate the information management

prpcess tan be4ealized through the appointment of a

Presidential-tftk,Force, the creation of an Office of

Information Management irj the proposed Office of Federal

Managemecnt, and the,selection of Information Coordinators

n the individual departments and agencies. The linkages

etween tfiese groups is shown in Exhibit II-3 and are

d1Rcusied kn the text which follows the.exhibit;

[Exhibit 11-3 on following 'page]

I
a Exhibit 11-3

A STRUCTURE TO FACILITATE

AN INFORMATION `MANAGEMENTI1PROCESS

..Office,of Ififormation

Management

manajement improvement

Financial IMprovemenc

Human ResourCes . yrgecing/Planning

:PRES IDENT I AL

'TASK FORCE

Establish'Government

Wide:Critical Success

Factors'.

Monitor

Implementation ,.

9

CABINET LEVEL

DEPARTMENTS

.Estab'liShDepart7

ment/Agendy Critical

41Cces,s Factors

Enforce Collection Standards,

OPERATING

UNITS
INFO GAP 5-1: Establish a Presidential Task Force on e. information management in the -Federal Government to conduct

an information needs assessment at the EOP level, add

fa. credibility to the recommended information management

proeess, ands add purpose toTthe new structure of information management This Task Forceliwould be responsible for

setting the ,top -down goals- and.coffimitment of the EOP. The

duties of this Presidential _panel include:

-p \ Select the first three to -six Government-wide

critical success factors; which should be "budget" and "planning" driven. This duty should be

completed in SO lays,.

Establish guarterlyvreview meetingsg,to monitor

and assess progress Of the informatfon management , "process And-structure.

,This panel should be representative:of,both public and

private sector-management and is intended to demonstrate

commitment-and-provide direction. It is not-intended f-coAdd staff and create excessive process. :The composition of

the panel shoyild

o Chief Financial .Officef of the United States

Government as proposed iilthe Federal Management

Systems Task Force Report.

Two to three representatives of Cabinet office's.

o Two to ttireesenior private sector executives,

preferably one of senior financial officer status

and one with management information systems

experience.

o Comptroller General of the United States.

Two additional members with..varied, but relevant

background. Possible Candidates might include:

chref-executive/oPerating officer with an

academic institutionvand.

city government executive for a city that

utilizes generally accepted accounting prac-.

tices.:

' INFO-GAP. 5-2: Establish a Government-wide information

management office in the.proposed Office ofrFederal Manage -

-ment (OFM)... The purpose'of this OFM'ofticeis to-proVide a

c 13s
linkage between the goals'of the Executive Branch as established by the Presidential Task Force and the implementing

phases at both the EOP and department/agency levels. The

office should include a Government,Accounting Standards

Board-to.support the Chief Financial Officer in OFM and

provide the necessary leadership on critical needs improvement-in accounting standards.

INFO GAP 5-,3.z. Create the position of Information Management Coordinator. One position' should be.established

and a Oe'rthpn, appointed to the position in each. department

and agency. This position is yital to, providing a constant

channel of communica4ion between the EOP,and the departments/agencies and the:-related operating units.. This

person will have many entrepreneurial Iunctions, asrwell as'

standard process functions. A posSible job description of

an "information Management Coordi.nator" appears in Exhibit

If-4.

[Exhibit II-4 on following pages]

111 13,9
Exhibit 11-4

REPRESENTATIVE JOB DESCRIPTION:

INFORMATION MANAGEMENT COORDINATOR

The general'cbjective of the Information Management

,COordinator (ZMC)

To faCilitate proper data coliection, informa-..

tion peocesiing, and dissemination which meets

the decision - making needs, of agency and department managers.

'Thus, the JAC bears the ultimate responsibility for

the efficient flow of timely information when and where it

is needed.

There are seven basic duties which the-IMC must discharge in order to'achieve the overall information management goal. The following duties are not an exhaustive

list, but rather an illustrative collection_of.threshold

responsibilities deemed critical to, the successful ,management of information.

TASKS

ANALYSIS For close consultation with department and

agency managers, the IMC must engage in an analxsis'Of the

Critital Success Factors (CSF)for.the particUlar department or agency. CSFs are the t1 to six key information

needs_thatare essential to ensure the attainment of

department or agency. goals. CSFs answer.the question,

"What do I need to.know?"

PROMOTION The IMC must familiarize department and

agency managers with computer applications, fostering a

greater undeigtanding-of how ADP and computers,can help'

managers obtain and use the information needed for informed

decision-making.

COORDI'NAT'ION The IMC serves as a liaison both within

the department pr agency and between departments and agen-.

cies. Thus, ,the IMC will keep managers within a department

informed of newecomputer applications while sharing this

,informatibn With ins from oth departments. The IMC will

coordinate managerial needs with. the ADP Information'

Resources Manager.

MONITORING The IMC will conduct an ongoing needs

assessment and monitor the'pecformaice of systems already

in use.

112

0-
Exhibit 11-4 (Cont'd)

REFINEMENT. Based on the findings of the monitoring

activity, the IMC will adjust:and refine equipment acquisition (including hardware and software) as well as modify

personnel training. and needs. Additionally, the -IMC will

assess a recommend changes in organizational structures

includi g systematic incentive/disincentive structures that

hinder of ective information management.

VIEW The IMC will conduct an annual review 01 the

total information management system. This review will

enc pass'not only equipment and personnel, but also an

examination of established and emerging CSFs in-the context

of, long-range environmental forecasts:

EXPLORATION The IMC will seek out and anticipate new

areas of computer and ADP applicatiOns in order to prevent

information gaps from occurring.

SKILLS (minimum qualifications)

Required knowledge, skills and abilities,:

'Strong Interpersonal skills

o Background in systems operations

o Err: coordination of diverse areas of respc ibility and unstructured problems

c Jood writing and communication skills

Education:

o Financial, some computer, background

Experience:

o Management Information systems

o Program management

Government operations

11.3

141

f
Savings and Impact Analysis

The cost savings, revenue and cash accelerations for

this issue, A.Structure to Facilitate the Information

Management ProCess, are listed in Table j.18, but the

dollar amounts reported are, duplicative of savings reported

previously,.by PPSS and are presented here only to provide

the reader-With a perspective of the scope and significance

of the'informat, ion gap problem.,

In reporting cost savingS and revenues, the Project

-Team has given' each inforMation gap a primary issue

assignment, although many of the information gaps are more

complex than any one problem area. Therefore, when an item

is duplicated within the Report, it is netted:clut so that

the dollar amount for any single information.gap is counted

only in its primary. area.

The informatiOn gaps and their related °dollar amounts

are reported over three years. The table vhich follows

consists of three parts: two detailed parts,,Section I and

.Section II, and a consolidated totals part, the ,Summary, as

described. below:

o , Section I: information gaps which are specifically addressed in the text of this i9sue.

Section informationAaps'which are not

spedifically addressed in the text of this issue,

but which the Project Team finds relevant to this

issue:

o SumMary: consolidated totals from Sections I

and,II.

Detailed discussion of these information gaps appears in.

the Appendix to thisReport, which is- contained in this

volume.

Implementation

All of the recommendations 'in Issue INFO GAP 5 may be

implemented by the Executive Office of the President:

(Table'II-8 on following pages]

114
Task Force

Issue Numbgr

TADLE 11-8 STRUCIURE 1/

Topic

Savings (S)/Revenue (R)/Cash Accelerations (CA) 1/

($ Millions)

it Year Year Year Three-Year

Une 1Hei Three .15041,

Section I: Information.Gaps Contained.In This Issue

USAF022 Procurement of Support Services

USD 2 Improved Inventory Management

OSD 19 Do° Laboratories

OSD-39 Financial Issues -- Government-FUrnished

Materials

ea 2 Management Information Systems

ED 3 . Student Loan Delinquencies

ENERGY 8 Multiple:Accrnting Systems

EPA 12 Financial Systems

Sat 2 Loan uuality Improvement

(DUST 21 Construction Project and Program Many

FEEDINGl . Policy and Management Intormation for

Federal Feeding

HoSP 5 VA tbspibal Construction Program

HUSP 9 Upen Market Purchases

HOSP 12 Duplicate Payments in the Federal

. AlosPital. System

FMS 1 ASSET 8

ASSET 12

Administration and Management

$ 68.8 $ 75.7 $ 83.2 $ 227.7 (S)

288.0 4,425.0 1,361.2 6,074.2 (S)

213.1 513.6 847.0 1,593.7 (S)

40.0' 44.0 48.4 13274 (S)

145.0 294.5 ,324.0 763.5 (S)

117.0 180.2 198.2 495.4 (S)

,3.5 3.8 4.2 11.5 (S)

1.2 1.3 1.4 , 3.9 (S)

2/

50.0 55.0 181.5 286.5 (S)

3/ 16.0 323.6 393.7 733.3 (S)

67.0 I 73.7 81.1 221.8 (S)

- 58.9 11-3 195.0 (S)

2/

.Cash Managelent Incentives 2/

rocl Govirrunont bending 1,054.0 1,910.6

Credit Prissing , 105.4. 307.0 '4 143

7,71.2 (CA

1000.8 (S)
T r:

TABLE 11-8 : STRUCTURE (CONT'D) 1/

Savings (S)/Revenue (R)' /Cosh Accelerations (CA) 1/

millionS)

Task Force

Issue Number Topic

Year One

Year 1MoYear Three

Three-Year

Total

Secpion I: Intonation (bps Contained In This Issue (Coned)

-ASSET 26 Debt Collection $ 600.0 $2,200.0 $5,300.0 $8,100.0 (CA)

60.0 286.0 844.6 1,190.6 (5)

HHS7PHS 7A Debt Management 7.0 7.1 7.6 21.7 (CA)

0.7 1.5 2.4 4.6 (S)

HUD 1 Financial Management Systems 222.5 - - 222.5 (CA)

88.4 97.3 107.0 202.7 (S)

84.0 92.4 101.6 278.0 (R)

JUSTICE 1 UnCollected Revenues 18.3 21.9 4.0 44.2 (CA)

1.8 2.4 0.8 5.0 (S)

335.0 138.6 152.5 626.1 (R)

JUSTICE 6, Automated Legal Support System 10.2 12.3 14.8 37.3 (S)

LABOR 4 roductivity Measurement and Improvement 15.2 16.7 18.4 50.3 (S)

LAND 2 Federal Vehicle Fleet ManagemInt 8.0 50.0 88.1 146.1 (S)

4.8 5.2 5.8 15.8 (R)

°NAVY a, Supply Inventory Management 66.6 66.7 66.7 200.01S)

' NAVY 13 Aircraft Pbwerplant Maintenance Managenvnt 5.0 5.0 5.0 15.0.(S)

PROP 6 In-house Maintenance Productivity 340.0 374.0 411.4 1,125.4 (5)

PROP 8 GSA Policies and Procedures 29.7 46.8 68.0 144.5 (S)

TREAS 1 Collection of Delinquent Taxes 23.0 25.3 27.8 76.1 (5)

'USER 1 vstr Charges Program Manawnent. 2/

0 0

144
1

Task''Force

Issue Iluinber

TABLE II-8 : STHUCWHE ('CUIT'D) 1/

savings (S)/Hevenue (8)/Cash Acceliritions (CA) 1/

($ millions)

Year Year 40Year Three-Yeir

Topic One Two Three Total

Section I: information Caps Contained In This Issue (Cont'd)

TTM 1 Federal Travel Procurement $ 297.3 $ 327.0 $ 359.7 $ 984.0 (S)

TTM 3 Trattic Management 160.0 176.0 193.6 529.6 (S)

Total Section I Savings fS) $ 2,299.8 $ 7,849.2 $ 6,401.9 $ 16,550.9 (S)

Total Section I Hevenue (H) 423.8 236.2 -259.9 919.9 (R)

.Grand Total Section 1 Savings and Rvenue $ /Mil $ Jana

Memo: Total section I Cash Acceleration !CA/ $ 1,901.8 $ 4,139.6

/.1

cV Section II: Intormation Caps Helevant To This Issue

$ 1111LA

$ 71,918.2

$ 17,470.8

$ 13,959.61CA)

...

EPA 10 4Personnel Management $ 1.8 $ 2.1 2.3 6.2 (S)

BOW 3 Central Health-UoD 225.0 247.5 272.2 744.7 IS'

.ASSET 9 Cash Management Incentives

Administration

NHS MGMT 3 Correspondence Control and Clearance 1.6 2.6 2.9

mis-PBS 1 PBS Student Loans. 10.0 10.0 ;CA)

I, ' (0.2) 0.6 (O. (S)

INTEHluit 9 Ca A) Management Improvements, 38.0 81.0 16:§ 219.9 (CA)

3.8 8.4 11.1 23.3 (S)

JUSTICE 2 Asset Seizure 86.9 95.6 61.7 244.2 (CA)

8.7 19.1 22.0 49.8 (S)

JUSTICE 3 Travel Procurement, Expense ilvNx)untin9,

and He t [lbw z;t:mtnt 1.1 1.2 1.3 3:6 (S)

'USER 8 USIA Forest Service FirewtxxI 19.2 21.1 23.3 63.6 (It)

145
Task Force

Issue Number

PPAV 1

PPAV 2

T

TABLE 11-8: STRUCTURE (CUNT'D) 1/

Savings (S)/Revenue (11)/C ash Accelerations (CA) 1/

($ millions)

Year Year Year

tine Two Three

Section 11: InfoOrbation s Relevant To This Issue (cont'd)

Oubli63tion Management $

PublicatiOn User Fee: 80.0 88.0

Total Section II Savings (S)

Total Section II Revenue (R)

Grand. Total Section II Savings and Revenue

Memo: Total Section II Cash Acceleration (CA)

$

Three-Year

Total

331.0 (5)

264.8 ,(R)

341.0 $ 390..7 $. 433.4 $ 1,165,1 (S)

99.2 109.1 120.1 328.4 (R)

$ ii L $ 122,1 553.5 $ 1,122,1

$ 134.9 $ 186.6 172.6 $ 494.1 (CA)

Summar11.1-Section

11"14. I dnd Section II Totals

Total Section I and II,Savings (S)

i(0

$ 2,(5101:

/

$ 8,239.9

- $ 6,835.3. $ 17,716.0 (S)

Total Section I and II Revenue (R) 345,1 380.0, . 1,248.3 (R)

Total Savings and Revenue in Issue 4 e /12Le.ti. $ 7.215.3 $ iwkial

Less Duplicated Savings 3/ $ 884.6 , $ 5,574.2 $ 2,664.3 $ 9,123.8

Less Duplicated Revenue 1/ 84.0 . 92.4 101.6 278.0

. . Net Unduplicated Savings and Revenue $ 4,14,9, $ ;.9113.6 $ X449.4 $ 9.54.5

Memo: /Total Cash Acceleration (CA) $ .2,036.7 $ 4,326.2 $ 8,090.8 $ 14,453.7(CA)

Less DWplicated Cash Acceleration .229.5 7.1 7.6 244.2

Net Unduplicated Cash Acceleriitiou $ 1,807.2 $.4,319.1 $ 8,063-2 $ 14,209.5 .

1/ Amounts in thisTa e represent dupliojte cost Liavings, revenue and cash acceleration for PPSS, as these

dollar amounts were ireviuusly reporld by ePlis

.2/ Not quantified.

3/ These amounts are claimed in another i55ue Within the Intormitioh.GaiLlteporl and are netted out in this issue.

All dollar amounts in the entormation cal. WPW..dupOcate-Liavims:previtmsly reported by PPSS.

`->
X. SUMMARY LIST OF

EMENDATIONS AND SAVINGS

/147

e.
IIA. SUMMARY LIST OF RECOMMENDATIONS AND SAVINGS

This section summarizes the annual and cumulative

savings for each issue in the report. a

A The authority requited to implement the individual

recommendations is also shown according to the following

legend:

A -- recommendans can be implemented under the

existing authority of the agency.

B -- recommendations can be implemented under t the

existing authority of the President.

C -- recommendations can be implemented by action of

the Congress.

The cost savings, revenue, and cash accelerations in'

this section duplicate/dollar amounts previously:reported

by PPSS and are. presen ed here to provide. the reader, with

a perspective of the sc pe and significance of'the

information gap-proble .

__- 7 In reporting.cost savings and revenues, the Project

Team has given eactrinformation gap a primary issue assign--

merit, although many of the information cjaps are more comp ex than any, one problem area. Therefore, when arvitem

i

i duplicated within the Report, it is'netted out both in

t e Savings and Impact,AhalySiA chart in the issue and in

this section.so tNAE the dollar amount for any single

infortation gap is counted 'only in its primary area.

119

iat
4 III. SUMMARY LIST OF REaJMff.NDATIONS AND SAVINGS

THREE-YEAH COST WINIS.(S)(REVENUE (10/ ACCELERATION (CA) OPPOTUNITIES.

Reconnendations

Establish an Information NeedsAssessment

Process via the Critical Success Factor

technique to be used by Federal Government

managers.

4 - Implementation Year Authority 2/ One

Conduct an organization-by-organization.,

information needs assessment.

Implement utilizing private sector industry

sta and tailoring those standards toFed="Covernment's management needs.

Each agency should review the types and

quality of data needed to efficiently and

effectively monitor its performance.

Adopt GAAP, tailoring it.tp the needs of P the Federal Government's accounting and

finance systems.,

The President should centralize responsi -,

bilities for each level of MIS and ADP

systems management in OMB or,CWM. Performance measurement based on achieving

specific agency and interagency objectives

should be instituted.

Each agency and department should submit to

OMB a long-range strategic, for upgrading information systems. Budgeting and

management incentives should be directly

tied to performance, and implementing the

program plans.

1 Savings (S) Revenue (RV

(bsh7Acceleration. (ishlAcceleration (a) Opportunities 1/

(4 millions)

Year Year 4 Three -Year. Three Total P $ 2,847.7 $ 5,294.3 $ 7,722.3 415;864.3 (S)

468.6 513.3 560.5 - 1,542.4 IR)

PV0' 2/

4,654.6 8,155.9 12,019.0 24,829.5 (S)

854.0 649.0 714.0 2,217.0 (R)

145.2 59.7 59.0 263.9 '(CA)

2/

1,513.2 6,478.7 4,409.5 12,901.4 (S)

124.0

' 136.4 150.0 410:4 (R)

498.9 107.1 117.1, 723.1 (C49

149

c.
y. .

III. SUMMARY LIST OF RECOMMENDATICNS AND SAVINGS (CCVTD)

THREE -YEAR'CC6T SAVINGS (S)/REVENUE (R) /CASV ACCELERATION (CA) OPPORTUNITIES

Savings (S) /Revenge (R)/

Cash Acceleration (CA) Opportunities 1/

($ millions)

ImpleMentation Year Year Year . Three -Year Issue p.. i'eounmendations ' Authority-1/ One. Two Three . - Total

7 INFO.GAP 3-3:

INFO GAP 4-1:

INFO GAP 4 -2:-

INFO GAP 4-3:

INFO GAP 4-4:

INFO GAP.5-1:'

Establish a software clearinghouse and a

tectihical.resource center to promote the

development of compatible information

systems.

Standardize data collection and file

structure codes for.basic data points such

as sex, street abbreviations, and Social

Security NUmbers.

Identify programs with high potential for

fraud and abuse by program type rather than

agency responsibility; require a common

identifier as a condition for eligibility

(i.e., Social Security number).

Familiarize program managers and others

withthe advantages of computer matching.

. Explore requiring front -end screening in

'determining eligibility for loan, giant

and entitlement programs.

Establisho44,iesidential Panel on informatton4management in the Federal Government

to conduct all information needs assessment

at'the ExecUtive Office of the President

level, add credibility to the recommended

information management process,, and purpose

to the new structure of information,management.

P, C

$ 1,761.8 $ 3,742.4 $ 5,766.3 $11,270.5 (S)

583.2. 641.6 705.7 1,930.5 (CA)

2/

2/

1,756.0 2,665.2 4,171.0 8,592.2 (S)

439.0 252.9 278.4 970.3 (R)

1,807.2 4,319.1 8,083.2 14,209.5 (CA)
III. SUMMARY .41St. OP RECCORIENDATICIAS AND SAVINGS (atIT'D)

, .

. TRREE-YEARIDUST SAVINGS.-(S)/REVENUE (R) /CASH ACCELERATION ICA) (PPORTUNITIES

tar..

. A .

. .savings CS)/Reven4e (R)/

CadhaAcceleration (Ch1.0pOortunities.lt

Issue 3E0 GAP 5-2:

:RecoMiendations

Implementit ion Year _ Year Year emcee -Year

. Authority 2/ One Zoo Three Vaal

Establish a governient-wide information " .P management. office in 04 proposed Of fice°

of Federal Management.. . t

. Crenti.the-posiUse-e--4nterratioaritinoye7

ment:Codt0h4tor. one position should be

estatiffiitapson_appointed_to_tiA.-

, -each-department and agency.',

btel Coot Savings (S)

:ail Revenue (R)

;mad Tbtal.COst Savihgs and Revenpe

Mho: Cash Acceleration (CA)

it 3

2./

$12,533.3 $26,836.5 $34,088.1 $73,457.9 (S) `` 1 885.6 r 551. 6 1,702.9 5,140.1 (R)

41.1&1116.2 $216212.1 112224k $8i2169.

-$ 3,104.5 $ 5,127.5 $ 8,965.0 $17,127.0 (CA)

4

/ Amounts in this Table tepresent duplicate cbst savings, revenue and,cash acceleration for PPSS, as these dollar amounts were ., previously reported in PPSS reports am of November 8, 1983.

cost. These amounts include inflation'and Wre net of implementation .- / Impledentat ion authority: Agency ( A ) , Pr es ident ( P ); CongreSs ( C ) .,

F, . / Recommendation not quantified, although cost savings 'may result

. . under an.,associated rectmdendation.

1 5 1
4
- Appendix. - Table f Cont nts

umber

Compendium of Information Gaps

in PPSSCC Task Force Report's

.One-Page.Summaries of Information

Gaps in PPSSCC Task Force Reports

Department of AgricultUre (AG)

United States _Air Force {USAF)

Army (ARMY)

Automated Data Processing/Office Automation (ADP)

Boards/Commiisions - Banking (BANK)

.29

33

40

Boards/Commissions - Business Related (BUS) 43

Commerce (COMMERCE) f 45

Defenses- Office'of Secretary (OSD) 48

Education (ED) 53

Anergy qENERGY) 58

Environmental Protection Agency/Small Business

Administrctionliederal_Emergency_Manage-'

ment Agency' (EPA /SBA /FEMA) 60

FedelCal Construction Management (CONST14 66

Federal Feeding (FEEDING) 68

Federal Hospital Management (HOSP) 71

Federal Management Systemi (FMS) 82

Financial Asset Management-(ASSET) 85.

Health and Human Services .-:DepartMentManage-'

ment/Human'Development Services/ACTION'

(HBB/MGMT). 93

153
,

Health and Human Services - Public Health i Service/Health_iCare Financing Administra- . tidn (HHS-HCFA/PHS)

Health and Human ServiCes - Social Security

Administratipn IHHS-SSA)'

95

99,

Housing and Urban Development (BUD) 101

I Interior(INTERIOR)' '106

Justice (JUSTICE) 107

Labor (LABOR) 113

Land; Facilities, and Personal Property

Management (LAND) 119

Low Income,Standrds and Benefits (LISAB) 120

Navy (NAVY) 124.

Personnel Management (-PER)

r Privatization (PRIVATE)

,129

1371

PrOcurement/Contracts/InventoryManaaig'ement

(PRO(.).._ 134

Real 'Property Alagemeht (PROP 138

.. Research and DevelopMent (14D) 144

r.. State/AID/USIA (STATE) 146

Transportation (TRANS) 15-1

Treasury(TREAS) y 154

User Charges (USERY .157

Veterans Administration (VA) 161

ManageMent Office Selected Issues:

I:. Publishing, Printing, Reproduction

Audiovisual (PPAV) 164

II: Travel and Traffic Management (TTM) 169

154

1.
COMPENDIUM

OF

INFORMATION GAPS.

The following chart is a synopsis .ot information gaps

discussed in PPSSCC Task Force Reports. Information gaps

have' been found in all reports issued to date.

he7-4: columns are divided into the following'categories: c Column 1

Column 2

Column 3

Column 4

. Column 5

- Task Force and Issue Number. - Brief deScription of the information gap.

- Main functional area affected, by'information gap (Financiaa'Management', Personnel,

Facilities, Programs, Materiel or' Support

Services).

- Information management roadblocks (Identification, Quality, ADP or Analysis).

Three -year savings, revenueo cash acceleration. The amounts in this column

represent duplicate savings, revenue, and

cash accelerations previously reported by':

PPSS. The ammints,are presented_to gro-_

vide the reader with a. perspective of:the

scope and'significance,c)f'the information

gap problem.

NOTE: NQ Means not quantified.

155
(11 (2) 13) 141

Task Force and Issue Muter

(1).. 14.2

(2) /4 9

Al formation Gap Descrikir a Functional Area

. Lock of information on borrowers' Finarcial and accounts results in f0Of receiVahlesianageient..

, Cutdated-statisticion age and Program Identification 3,431.1 (S) sex characteristics of family

participants leads to excessive'

benefit allotments..

4.

Primary Problem Area

Ate

(51 Ihreehar Savings4(S)

Revenue Enhancement (R)

Cash Acceleration (c:4)

1$ Millions) $ 61.1 (5),,

. 178.0 (CA)

13) AG 33 inadiguate information to , Financial Identifiation

establish indlvidual'iloan limits

for foreign bank borrowers leads a

to necessary risks in the Coar

iodity Credit Corporation's for-

,. .! 'eign guarantee portfolio,

(4) 'W,AF 13 lack of'modern autreated data prop Materiel ADP. 580.6 (S), ceasing (ADP) systems results in

inefficiencies in the Air Force Logistics Omani inventory control

and other logistics fat*.

N) (5) . USAF' 16 Restricted flu of technical Materiel

(. 94.41ity '689.1 (S) data necessary for coapetitive

follow -up procurement of spare

parts results in ineffectiveness

44. and 166 cost-efficiency.

(6) USAF 20 Lack of dual-sourcing statistics ,Materiel Identification 1,422.1 (S)

and follow-up evaluations causes

future dual-sourcing opportunities

to be lost.

(1) USAF 2 The Federal ProCurement Data System Materiel Guilty 227,1 (S) cannot identify how many consulting

stice contracts the Federal Government has, for' what purpose, or at what cost. This information gap

leads to excessive and duplicative

(8) . ARMY 1

consultant procurement.

Serious weaknesses in caputerized Personnel Identification; 189.5 ($) allocation systems attributes to

the continuing inefficient use and

maldistritution of trained soldiers. 156 1 7
(1) (2) 13) IS)

1, ', Ihree-Yeariavings Ist) i

Amok thharcement ill),

, , Task Force and Cash Acceleration (CA) , Issue Muter Information Gap Desciiptor, Functional Area. , 3 Primary Problem Area ($ Millions) ,

, 191' ARMY 9 Lack of management information Personnel Identification $ 33.7 (S) 0 on costs of the Laarning'Resoutce

Centers blacks the evaluation of

the prcqram:i effectiveness.

(10) ARMY 10 Inaccurate measurement of pro- Materiel

,. ' curementvosts of major weapons

systems prohibits correct-analysis..

of cost overruns and cost growth.

(11) ADP1 Many of the Government's'171006 Materiel coniuteri are incavatible andtherefore cannot 'talk' to one another to mare data from one

program with another.

Identification

(12) ADP 4

113) ADP 5

Lack Of centralized general hard- materiel

ware and software statistics on

the various Ape systems of the

Federal Government prevents effective Are alhagement pmactices,

Lack of documentation of telepro- Materiel

ceasing costs leads to poor teleprocessing resource management.

(14) ADP 6 .kack of management information Materiel on office automation prevents

long-range strategic planning.

(15) ADP 10 There is no specific budgerline Materief

item for the Army ADP and precise

figures are unknown. The Army

doesn't know how much it spends on

ADP/GA, what kinds and numbers of

coacuters it has, where they are

located, or whether they should be

replaced. '

1,963.8 IS) ,

e

Identification 4,029.0 IS)

Quality 517.0 (S)

Analysis

Identification

(16) ADP 15 ObsOlete,and antiquated systems ., Materiel Analysis

iMpede access taileeded information

and prevent ongoing computer matching

to uncover frauds and abuses.- Affected agencies and deFertments

include VA, ISIS, a, SSA, and IILID.

158

6,537.0 (S)

027,5,(S)

159
(I) (21' 131 Nl ,(5)

, Threes( Savings (S)

Revco Dtancesent (II)

Task Force and

. tub kceleration (CA)

Issue timber Information dap Descriptor furticoal Area Primary Prcb len Area ($ (17) ADP'I The IRS estimate' that in the tax Materiel

year 1981 the gross tax gap (taxes

dee but not reported) from hell-

'ideal and Corporate rune, nonfatal, and the illegal sector' was

at least $97 billion, The information doculent mading.program

has had 601i SUVA in limiting

,the tax gap, but millions of

returns (abiut 20 percent) ',bete , still not entered. into the system

for tax year 1971. Ibis delay is

caused by inefficient, old'eguiFment.

(18) BANK 1 PI is unable to publislrverifiable Financial

financial statements despite its

( ' present asset base of me than'

1500 million, ,

(19) BAKE 4 Pension Benefit Guaranty) r- Program

potation: inadequate Internal

operational systems results in

0, disbursement of pension checks

on an estimated rather than a

verified basis and contributes

to excessive case backlogs.

(20) wit 8 'NA has lost control of its out- FinanCial (uality

dated financial reporting system.

The system is, cumbersome, not

understood by staff, and inflexible,

(21) areiXE S EDP lacks adequate infoisatico ,Financial ADP ' concerning its borrowers to make

reasonable loans - and the result.

, . is an appalling rate of bad loans

and delinquencies.

(22) (DIEK1 5 Deficiencies in the Economic Financial Art

Development Administration's

business loans infornetion

system results in poor debt

collection procedures.

Witty

160.

$ 324.1 (R)

132.4 pq

3.3 (0) 15,0 (CA)

61

41
0 ,* 4

(I) 0' (21

A

13) 14) 7 11 !

: 0 - ihreeear.Samings (S)

.;S. . NevereeErhaxsent111)

.; ?ask Force and A Cash Acceleration (0)

lisue Number information Gap Degriltor Functional Area ?lime' Prates Area

4 .4

1! Millions)

(23) CSD 2 Inaccurate and out-Of-date inven- " Materiel AM; ' $6,074.2 (S)

, torrsanagesent information~ results, in poor inventory 'Awing.

in

(24) CSD 19 hike to dirmslinate information Materiel .0 Structure 1,593.7 (S)' ' on emerging technolixffdevelopments

leads to sUbioptIpal weans systems

develoiment. 7

(25) 06D 22 lniccuratelonitorinq if acipisi *tercel

tin costs of major reapons'systems

leads to significant cost overrun's.

(26). C6D 23

(27) 'CISD 39

(28) ED 2'

(29) ED 3

Orderly and efficient. we-. ; system Materiel

acquisition is.isposslble of

disjointed internal OoD .!.ting and

Congressional appropriati Ituk

sore systems are put in reaction

thin can be funded in loal pro

duction quantities during the product

cycle oreach system.

Quality

Quality

Do0 has no information on the amount Materiel Structure ' of Government Furnished Material PIO provided to contractors or

which contractors should receive GEM.

The information system in the Depart- FinanCial

rent of Education is unable to sfruc

ture financial data in a useable

manner. The general ledgers simply

record historical data, and inadequate internal controls result in

waste, fraud, and abuse.

liar data on loan defaults and weak Financial

reporting requirements for lending

institutions complicate delinguencies

in the early stagesOf student loans.

Witty

132.4 (S)

763.5. (s)

ACP a" 495.4 15) ,e

" Potential Saving6 are reflected in Issue OSD 23 which, includes the role of cost estimation in the instability in the weapons acquisition

process,

162

6 163
Task Force and -, Issue Number 'Information Gap DescriptOr finctional Area Primary Problem Area

(30) ED 4 With $150 milliOn in 'annual outlays Financial Analysis

for contracts and,discretiOnary grants ),

in FY 1983, DOB has been unable to

close 80,000accounts since, 1973 worth

$584 million, a sizeable portiorof

which could be money owed to the

Government.

(3) (4)

. (31) ENERGY 8 OcE's non - standardized inconsistent Financial

inforMation system cannot generate

accurate data on fixed assets, ndnfixedrasset property, or breakdown

departMent expenditures - below the

appropriation level.

, 132) , EPA 10

(13). EPA 12

4

(34) SBA 2'

The Environmental Protection Agency Personnel, . Structure

(EPA) training program does not keep

track of expenditures or analyze

training activities and results,

Three-Year Savings (S) ' Revenue Enhancement (R) Cash Acceleption (CA)

(S 5 207,6.(S)

4

6.2 (S)

The EPA'a cost and financial infor- Financial AOP 3.9 (5) nation system is so complex,lhat

EPA employees rarely utilize it

properly, Control capabilities

concerning receivables, payables,

and cost accounting are not

implemented. Small Business Administration officers receive,90 days and

over" past due lists 5 to 6 weeks

after the fact, diminishing the

'ultimate collectability of many

past due loans.

Financial

(35) FEAA 1 The National Flood Insurance Program

Program has collected little historical data in order to

. establish a sound actuarial

basis to predict future needs.

Structure

Quality 662.0 (5)

(36) CCNST 21 Construction management'informa- Facilities' r Structure 286,5 IS) tion focuses on financial rather

than phySical status reports. Formal detailed construction sched-

, ules are not always prepared and

1 complete site data for development

. 'and review of construction costs

and progresi are not acquired,

165 4
. Task Force and

Issue Number

(37) ,..1:134911 23

(38) UMW 1

(39) FEEDING 5

(40) M3SP 3.

(41) ICSP 4

(42) HIP

(43) HOSP 6

(21

(3) (4)

n oration Descriptor Functional Area

SSA bates budget: requests for , Facilities

facilities on crude estimates

and private sector experience

rather than its own inform4tion.

The cost of land' is seldom known and the discount rate far ,buy/

lease divisions are not clear.

The ,size and scope of Federal Support Services Identification feeding costs and operations

are unkricun: When cost data

are obtained, they are often

inconsistent and improperly

defined.

Primary Problem Area

Three -Year Savings (S)

Reyenue Enhancement (9)

eish Acaelerition (CA)

(8 Millions)

identifitMtiOn i

The, cost index used by ()onto

establish the feeding budget for

the uniformed services is based{

on more expensive food items than

actually consumed in dining facilities. DoD does not know the

costs of labor, transportation,

and overhead associated with feeding operations.

Support Services . Quality 'a

The Military Health Carelystem s Financial Uniform Mart of Accounts omits

costs sucikas employee benefits,

construction, and overhead. Ibis

lack of accurate cost data inhibits

the planning process and results in

excessive program costs

The VA's patient treatment file Financial

lacks informationihecessary for

the adoption of case-mix-based 4, budgeting.

Poor data and assumptions are used

by the VA for construction planning (ie, facility utilization 11, trends', etc.), resulting in wasteful construction projects.

The VA lacks information pertaining Personnel to facilities' workload, institutional budgets, and case mixes.

166

Facilities

Quality

Quality;

Identification

Identification

)43

$ 167.3 (S)

744.7 (S)

4,687.6 (S)

733.3 (S)

14)

167

5
(1) (2) (3) (4) (5)

Task Force and

Issue Number

1.1,(41) 149 7.

oo

(45) HOSP 9

(46) H3SP 10

447 HOU 11

(48) WISP 12

(19) H3SP 13

(50) MS 1

(51) /XS 2

188

Information Cap Descriptor

The exlstiniVA hospital information system has little value

for management. Users get duplicate and erroneous data and

slow processing of information

generally.

Functional Area MaterielNeither the VA nor DoD has a pro- Materiel

cureRent data system to monitor

how frequently hospitali.Nrchase

on the open market Shen such supplies can be'acquired through

national contracts at a discount.

DoD health care claims officers Program

are hindered by a lack of information necessary for processing

claims, resulting in a loss of , revenue.to the government.

Many recipients of Doh health

care benefits also have private

insurance. DcO does not have the

cost information necessary to seek

reimtursement for health care4aymenti made to these inlividuals.

There are no procedures for

DoD, VA and the Indian Health

Service to identify patients

with dual eligibility for health

care programs. Thus, about 19-201

of claims result in duplicate or

erroneous payments. -VA-clains authorities do not

have the information necessary

to determine when veterans with

non- service - connected disabilities have insurance and /or can afford to pay for medical services.

-0. Program

Program

Program

"''Lack of Government-wide management Financial information iMpedes focused Executive

Branch policy setting

The use of 300 different accounting Financial systems has contribUted to a lack

of timely and accurate management

information for use by agency heads.

pr Wry Problem Area

cuaiity t

Quality

Identification

Structure

Quality

Stricture'

ADP

tree-Year Savings .(S)

Revenue Enhancement (R)

Cash Acceleration (CA)

(S Millions) . $ (365.5, (S)

221.8 (5)

68.5 (R)

1,211.4 (11)

195.0 (5)

1,441.2 (R)

10,
, (1) (2) (?) 141 :15) tree-Year Savings (Si

Revenue Enhancement (R) Task Force and

. Cash Aiceleration (q) Issue Umber 'Information Gap Descriptor Functional Area Primary' Problem Area ($ Millions) ._. . ,

(52) FMS 5 The Federal Government currently con- Financial Quality

ducts no caMprehensive inventory of

'hits capital assets thus, no longrange planning is possible.

(53) Assn 8 Agencies,and departments do not have Financial Structure accounting systemite monitor cash

management processes (tracking re-'

ceivables, payables, ot,inventories).

Most cash, management is historical,

afterthe.fact recording of,data,

(54) ASSET 9 The Federal Government can not Financial ' Structure

centrally determine:

o delinquency and age of

debt owed, the. ,Governmenti o,cash'held by grantees' ocash balances; or

o total Federal .funds

committed to individual

states and localities.

(55) ASSET 12 No government -wide.statistics are Financial Structure 6ailable on the creditworthiness

of borrowers., Credit definitions

vary between,departments as well

as within departments. .

(56) ASSET 23 'Mere is a lack of data to monitor. F nandial Structure

the quality, size, and losses bf

guaranteed loans. Thus, agencies', ate not held.acoauntable for their. 4 programs and'portfolio problem

,because thee problems are often

undetectable.

(57) wer 26 Total debt owed the Federal

Government.has,increased 251

A since 1978 while delinquencies

have risen by 381: Mere is

little incentive for agencies

to collect debts because the

monies collected go to the

Treasury Department and do not

affect the agendes' annual appropriations. lbw, the agencies

give a much higher priority to

loan and grant programs and very

170 little to debt'collection.

Financial

$ 1,010.8 (S)

5,571.2 (CA)

Structure 1,190.6 (S)

8,100.0 (CA)

ti

,171
(1) (2) (3) (4), (5) Three -Year' Savings (S) Revenue Enhancement (R) ash kceleration (CA)

(4 Millions)

Task Force aril Issue Mixt

1561 ASSET 21

Information Gap Descriptor iiiinctional Area

As of June 30, 1982, total outstandipg Financial debt owed the Federal Government wat $14.3 billion. Yet the IRS opposei'

offsetting taxpayer refunds against

delinquent debts,

(59) HHS-MiT 3 SS to 60 people handle 'loch piece of Program

mail requiring Secretary-signature

response at Ills leading to low correspondence productivity and slow flows

of information.

(60) IIHS-PHS 2 Adequate contract health care Program

May not be provided,to American

Indians due to an outmoded manual

claims processing systes. the

danger also exists of unnecessary payments beingoie.

(61) HHS-PHS 1 Due to inadequate accounting Financial ',Aystems; past due loans are

not vigorously pursued and

minima payients not insisted

upon.

8

Primary Ptcblem Area'

Analysis

Structure

(62) 1111S-PHS 7A There is a lack of monitoring Financial , ADP

of debt collection and the

delinquency rate is excessive

due to poor control of billings

and receivables.

(63) 106-101:6 The Health Care Financing Materiel ADP Administration (HA) Bureau

of Quality Control is basing

`current cost studies on 1919 data; ,HCFA experiences poor financial control.

(64) ISIS -SSA ,3 lbe Secial Security Administration Program

!SSA) is unable to compare earnings

reported on W-2 forms 6 benefits..

paid: As a a result, some beriefi= ciaries may lose benefits and

'others may defraud SSA.

(65) RUO 1 Ho one area of RUJ has been given Program

total' esponsibility for coordin-

.ating Deplirtmknt-wide financial

172 systems, Thus ) management often doesn't know what it doesn't know.

$ 398.1 (0

119303 (CA)

7,1 (0)

116,9 (S)

(03) (S) 30.0 PI'

4.6 01

324.3(S)

292,7 IS)

218.0 (R)

222.5 (CA).
Task Force and Issue Hibec , Information Gap Descriptor Functional Area 166' HUD 2 Too such data overwhelms Managers, . Program

'tailing timely decision making.

(61) HUD 3 The monitoringand collection of Financial': delinquent accounts Is hampered by

anticipated ADP systems, This

results in delayed collections, or even in no collection across -

the- board.

1661 RD 5 Inaccurate aid f4rudulent financial ' Program data prevents HUD from employing

cceputer matching to verify

eligibility for Section 8 rent.

subsidization beneficiaries.

s

`11691 IIMERICR 9

(10) JUSTICE 1

The' ick of adequatpaccounting Financial controls at the various bureaus

of the Department of the Interior,

results in post cash management.

It can take, In excess of one

week to Collect a, payment record

Ind deposit its and often takes-

. in excess of two weeks. Ctmparable

tasks in the private sector are

accomplished in one or two dayis.

C153 collection efforts suffer ; Financial from a lack of uniformity in data

supplied by originating agencies,

accounting tens, monitoring processes, and definitions Of an over=.

due account. Ihus, debt receivables

management .has not been effective.

Additionally, the most efficient

ratio of staff to caseload is impos-

, sible to determine,

(11) JUSTICE 2 There are no government or agency Financial wide totals on assets seized as a , result of FBI, IRS and other

agency investigations.

(?2) JUSTICE 3 CCU does not receive regular,

. information on GSA,negOtiated

travel rates, resulting In

excessive travel costs. 174

, a

(5)

Three -Year Savings IS)

Revenue Fnhancement (R)

Cash Acceleration (CA)

Primary Problem Area (; Millions)

Identification $ 69.6 (5)

. 30.4 (S) 285.9, (CA)

Analysis 1,870.1 (S)

Structure

Quality

23,3 (5)

219.9 (CA)

5.0 (S) 626.1 (R)

44.2 (CA)

, 49.8 1S1 244.2 (04

Support Services Structure L6 (S)

4 175
U)

Task Force and

Issue Number

(73) Jusrice

(74) JUSTICE 6

..(75) LABOR 1

(16) LABOR 1

F-1

(77) LABOR 9

'(18) LAND .2

(79) LIMB 4' 176

I

(2) (31' (4) (5) 111reelear Savings (S).

Revenue Enhancement (R)

'I' Cash kctlerat'ion. (CA

InformitiOn Gip Descriptor Functional Area r Pr Blurt Prailem Area ($ Millions)

, The datli center at CCU'llas . ' 'Materiel ADP

been unable to meet user re-

, ? quirements In itimely, efficient manner. pal does not routinely gather Support Services. ' ALP basic case information such

as tie number, type, and status

of cases aid investigations in

the divisions and the'offices of the U.S. Attorneys. MI

result, theruis a duplication,

of effort in attorney time.

Lack of statistical data makes \Pirsonnel

effective administration of the FederallIployee s.Coppeniation

Act (WA) impossible, The kaitoring.and control functions are

inadequate to detect abuse.,

The DOL's mahagement information Personnel Structure

systems do not produce the information needed to evaluate the per formince of individual employees.

Without. this productivity measurement it is.difficult to improve

productivity and thereby result in

cost savings.

Long distance telephon reports ace

not produced for calls placed before

8:00 a.m. and after 5:00 p.m:, As a result, cost containment of perscaal

and unnecessary calls is. impossible. 'There is no central information or anagement system to control the

Federal vehicle fleet, resulting

in,duplicity, inefficiency, and

higherautceobile and trick operating costs. Income.verification for keeds.. based programs is;difficult

because present data sources

are neither centralized nor,consistent in availability. %This

'resulted in over-paymenako(

$4.,1 billion 1982.. L

Support Services

I , '\ Identification 1:1 l(S)

189.0 (S)

k,

Support. Services Quality

Program

146.1 (S)

15.1(11)+,
A . Task Force and Woe Miter /

(80) S

Information Gap Descriptor

Duplicate and erroneous payments

are made to recipients.of AFDC,

Piedicaid; andlood Stops benefits.

because there is no Centralized

data base to determine ellgibility.

(81) LIMB 7 SSC is afflicted with missive over-

. payments because ofm lack ottimel

kormatloyzegaidlng changei in

circUmstanCes of benefit

, recipients.-

. C'

. /.. (82) tail 9 There is a the lapse of six moths

between the monthly sampling of cases

for case ellgibilityldentification..

and the determinatioi of the, dollar

'. m

.

.. untAf4!ervices iy pro.

vided by Nei:Ibid. error rate ...,_,40_0_196Lwasipeccen

cost $1,3 billion, ' .

Emotional Area

. Program

14)

Primarylloblem Area

Quality

(51 I.

**Tear-Savings ($):

Revenuipatinient (RI' rash ligation (CA)

(8, irlons)

-.61t s. 14379,2 (8)

(83) NAVY 8

(84) NAVY 13,

Props

A Analysis

Cale to antlewated muter

equipment, inaccurate invents*

records, and unreliable maAagement

infofmatiShoostly-emissions lvS4

excessive inVentorylossel plague

the Navy's, supply systet.

Program tanagers of.the Naval

Aircraft tioWerplanti at the

depot level have inadequate

-datt!,,concerning' material usage,

man-hours workedloand inventory

status to,adequately assess shop

performance. ,

Nateriil

11,

Personnel

'(MS) NAVY 13 l val Aircraft Powerplant depots"

su firm a lack of inventory

contrii resulting In inefficient

use of prom ine funis. g

ry

(86) NAVY 15 Die to inadequate tlng finScial

sYstOl he-substantlationies Noy finance onter-

, , dai,ly(t often hoOdemite0 [Or

several days. phis increases the .

. risk of lOst checkg and denies the

federal governMent of fondi which

' 51 should be available.

.......

'1

Quality

ALP

. 4

t

161) (s)

'

......

,

t v't , V
12) (.31

,

Task' Force and Issue NuMber

(87) PER 14

Information Gaplescripior* Functional Area '. No one in the Federal CoVernment P4Innel.

knows bor much otal is being

--artHet-aeoutately-mecorded-----15'77---\

--(84 =PER 18 Federal-agenciet are unable to 'Personnel provide reliable information on

their Workforce needs, resulting

in the4serce of a uniform workforce planning system and a lack

. of budgetary input into the plan;

nine process: .

(89) PO -

HIRDILT SPJA 2 Agencies use i ate i as ..sis or det ining,personnel costs - thus costs are generally

understated and unreliable for budge-,

buy decision-making.

(4) (51 Three-Year Savings IS)

Revenue Enhancement (R)

Cash Acceleration (CA)

-'''''Primary.Pioblem Area ($ Millions) Identification. $ 66.2 (SI .

Identification.

I

111

1-1 (90) PRIVATE 5 Actual operating costs of the Do)

.P. commissary system.are difficult to

%. compute because a number of indirect

costs are not r:barged to, the system.

(91) PRIVATE 7 Creative accoOnting statistics result .40)00 Services ,Quality

inn higher than needed

for.maintenance and acquisition costs

associated with the Government's 41 '' ° vehicle.fleet.' ,

Financial

4 quality

.(92) :PFCCIL'.Donest'ites_lor_majot---:--,--Firiancialweapon systems are misleading because . they usually contain inflated figures,

also called "managementieserve,"

(93) phloc 10 The accuracy of demand forecasting-7 _Materiel

-is poor clue'to'a lack of,reli e .clataindtbe-inatitity-of-eomputer---------7-1-

Systemsqo 'handle modern forecasting methods.

(94) PADIC 12 Don does not utilize the preferred materiel private sector system of inventories

called 'wall to wall." he antiti-Count-maptelulde

misstated during_the,inventorii_process.

2,064.0 (S)

383.2 (R)

399.0.191

ADP

Quality

4,540.0 01
4,

. , .1

(t) (21 ' (31 (4) (5)

4A /

k

Ihree-iear Savings (S)

Revenue Fahancetront (R) ,

,. N.) ) 1--lask Force and 0 Cash Ptheleratiqt.0)

j Issue Number Information Gap Descriptor flartional Area PriAd.d_Prpbleni Area - s (1 Millions)),

S

s

.

. (95) PRI 19 A lack, of adequite storage and acces- Materiel Identification $ 97,0 (s): 0 sabil ity tovendsr_eqedeca_data---

results in repeat business for unsat- ,i, ,isfactory vendors.

11111 (96) ... PFOP I MA carrot'effectively ai?riage . Facilities Identification

. .

. Government-owned, building's sloce .

', ithariio dichanisi7fOr scatterin'

..(splice ivailibility, vital, rates!: op

even spicelibilimatinrs.,,-, , 4

(87) PRDP 2 ,,GSA lacks offiet;spiteuthly,:-.: '' " Facilities

a' :data besaube agenda are '

,A

(98) PROP 6

/0

itsioogir req,dred tO 'knit. such . i4kramtion:,.doeitiPi`,even, 4. . Ired,40te 1

reglilar

Productivity in carry Fersclinel

house aiiAten'ariat i)f real proper,

is .substalitially lielaioprivate 's

sector Standards due to clack, o

\motivatiOn'and

(991' PIO' 7 -LC.Sa'S lack of interest in cost 7'Facilities

contrOi :results in no Energy r.

A Managecont (Intro' System (which

is Videly4,uied in the private

, sectOr)''becng 1'n place toercoltor

energy needs and and to

.drenergon.the .. National Capaekegkon.. .

(100) PROP a

17,

4000 Rio 6

4

`GSA is unable to effectively , manage its leases 'and ,

, aoluisitiont becaiigo it litis 1

, summary data on iti:leasesand

space pancy.,

61,9 (S)'

Identification' 234.4',(S)

't

St4ture 1112,4 (s),

identification s, 185(.1 01

FinanciAl Stricture

ft%

s ,

41,s. ,,144.5 (S.

t'A, 25'.5 (SI

1, Ni;ceot :R&D database

from

so

44,'. ',:,-;' ihlt knolledgeP gained, frai previous

;)1.4 used 0. a basis ft)? . iii,, Ain't research,

0 1 ,.- A'?.' -`'

Support Services Identification
.4

11) ", (2)

151 m

. Iltree-Year Saving (S1 , ..i.

Reverse EnhanCelent. (R) I.

... , !task Force an!, p,

, (Cash Acceleration rAl Issue Humber Informatics Cap Descriptor s Rational Area Flimsy Pr& la Area ($ Millions)

. (

0.F.',,

(102) STATE 1 .-1 ,Ite OffiCe of Foreign Buildings ., ,facilities UP

, .' N),

A , . . ..

(103). SPATE 3

D) does not have toompr_ehersive*

reit property minagement inform.

tion.systei Thus,, its inventory

is Incempletelld other information deficiencies thwart informed management. dedisitwoliaking.

',

.., .FFO's present financial management' . Materiel . Quality

system not provide the nos.

sary fi al inforsatice to ..- ideltifi rating Omits iCI either r

, indlvid001 buildings or the aggre=. . ( gate of buildings. ibis; FO) bases I' J '' its bUdgetary decisions upon incur

V plete 'facts. u, , , t , . .

It systaimxists for ,forecasting and . Finangiil ,

reporting foreign currency expendi-

..... tures;.- 0:6 expatiates he *it

flUctuationi ant continues to Slifer

.dttl ,'

i4 04

, s foreign currency losses: , .

(105) .. STATE 4 , No studies on forlign currency Financial i

.41 , 4 Clialiir

. , ,''' 'hedging exist and 006camOt accur- .

. .. , ....,, cutely predict its foreign currency ',. ' ,i _:.L:2,_;____________obligations-ard-putsbatep,--- , , Alt:.,-----

.. , ., .

(106) STATE 51 The Digesi of Refugee programs Program

, (IRP), cannot reoaver each of the

4

conies it .contributes to the lntet-

; national Conaittee fdrAigration, ..

? because of inadequate refugee.

. 4 f(.% tracking programs, As, a result, e, i DRP 1 ; Pi , reTvers only About 8.8 cement

... ,i .of, its outstanding loans its ,- i outstanding receivable '. Wu

. . . totalled 116k million '`off

. .. 10,3'0198i'`. ,

, ..

.4 The writ spent $10 millibn on.a. Finandial

cbs4ser,,yet has ban unable to

chlse its :bcokm since 1979.. i

i

t s

I 4.

t

o.

$, 17.1 (5)

!

o o

to Waiitt 1071 (S)

56),9 (CA)

r 4 "

6

=
4 Informatf

(511

Thfel-Yeat Sivirgs (S)

Amine alhancetent (R) 6101 iccebritioil (o,)

priory Problem Area' Kilik410 4

1 r

;

" e

11091 111A16 5

(1101 TR'S 1

1'

Ihe Urban Mass tatiM Plain,. Program istratfonligrA4 atirs ao:urate, . oirplete.and current information for

processing and monitoring grant apply

cationic and for accounting and tetttaryrdstilichreirltingrant over

payments, lapsinq ofdunds and gisap....

propriation of funds..' ' In 17 1981 GOT spent 1160 million Materiel

to operate its ADP services'yet !till does not have information deeded

for the development of an organized

ARP syitem acquipition program.

4 IRS'i limited collection resources Personnel are not effectively deployed due to

inadequate'staffing and inefficient

system .to monitor the collection

of delinquent taxes - resulting in . a loss'of revenues and Inzreased

operating costs.-

TL EAS 2 )Ihough the IRS has a demonstrated

need for adding personnel CO its

Personne revenue4nerating functions:the

lack of a system-wickevaluation

it personnel needs has delayed the

litrirg of additional personnel.

l

(11 iITELS:, ','- tkrk-of-accurateimanufacturing

MD SPAY 'Costs makes it impossible to

° ° , . deterninehtich mint facility . should be responsible fore the

production of various coins.

(113) ,USER 1

F The existing budgetary' ccounting

Systimacts.as a disincentive for thOfficient collection of user

charge; receipts... Asa resdlt, the

Govermen6Joes not set prices or

mane receipts so as to maximize

. prod tivity cost recovery, 4nd.

ptog am efficiency. '

a

Are

163:5(S)

Facilities

Financial

Identification'

ARP

Structure

, .

F

16.e ($)

761i (S)

187

V

a

r

9
0 4.

Task Force aril

Issue Nutter

f (114) BEER

r (115) sm8

Information Gap Bert-1*ot

The Nationai Park Service (NF6)

lacks the infOrsaticn for devising

.1 rational rystli of user fees'

Mach currently;accomt for about

101 of WS' total operating toilet):

1.hu4anel SYStel of user fen has

been devised which would increase

the percentage of the overall budget

'provided for by such fees.

Kra9elent'asystems do not exist Financial

that will track the cost of gialnlsterinj the &mai program.

There is no accountability for

costs,or valuetecause there is

no control mediaeism to establish

a tee gystethat would allocate

supply to desini or relieve the

'taxpayer of the cost of afbinistering the program,

a

131

flaticeal'Area

financial

,k ma" ' UR 17

(111) VA 1

It is brossible to determine

the actual costs to any agency

to process Freedom of Thformition

(F010requests per 'staff tact

Thus, agencies Undercharge and ate

not4ecovering the costs of fulfilling MIA repots - an average

of 921 of the costs of the FOIR activity is subsidized by the taxpayer.

maximKan* controls necessary -to, personnel

outpUt of existing field

station personnel do.not exist,

Thus, productivity in the field

stations is lcw, timeliness in the hia Processitog of claims has declined,

and the officis are overstaffed.

188

financial

, V' The VA's Department of. Veterans pro3rie , Benefits pays out $15 billion a year

to slit million claimants. Yet 4i has

no dati to 'assess the accuracy Of these

paympts, even though It ,has been

estimated that the error, rate could be

in erdess of $500'sillion a year.'

Three-Yeat.irvirgs (Sl

Revenue Pahanceent(R)

Cash.kkeleration,(CAL

Primary Problem_yea

., Identification A ti 99.3 (R)'-

Sturcture

Identification

.

Quality

equality

(R) a.

,

(R)

171.7(5) r.

1,484.5 (5)

189
a

PPtiV.1

(121) PliV 2

w. N.

11)

(122) PPAV

' (123) PPAV 5

' 1, , ' 301 h ghercosts of, patting as cappared,to the private Sector,.,. R` 0,,. I

Inf Desert

r . . -tie recovery rate VA's

debt collection activity is low

*awe accuri information . .regarding .the v end'statos

of the debt 11A it not

available,

6.. 1

Functional Area. Primaryltoblem Area

. . ginanciat tuaiit'y

,

Agpries have no centralized

inventory of pi ilcations

produced'ot. in circulation -

'

because there is re

one person with the 'publisher'

expertise or reitonsibilityjir

Ado ;there are many, duplicative

`ind inferior putdlcationi ptalu*

*lay - at greet 'cost to the taxpayer,

10. f9

Agencies have'no but siting

structure thatwouW"persit the

axlirate trackiing.otcosts Moodated with publiShing,,

Government ()anti% Office (GM).

reserves the'eiatisiie tight to set EublicatpioriCis and cciliecti'

Ales revenues -.thus,. the agercidt

lack incentive to etbablish isystem

for tracking aGtual costC -

, 451' , FT

Three -Tar Seeing:IX

Rieree.pritenavent (14:.

CIO kotieratiat JG'4) ;,; (s Million's)

!'

Val

. ,53;9

Stccort , Services-, Structure

Finerefel Structure '

. a. ti .

'Systems for maintaining Federal . Support Services

pbstal accountability do'not(exiq

and result in wasted,government . 6

funds through unnecessary use

Of highef,mail classifioations

and fa' re to use bulk mail 0 diInformation on the utilizitiorOf

printing plants,. presses and staff

is,notkpown, This situation has devel..4... se of the bifurcated itrUcturefiemen the

i4ain Ccaaittee on Printing all

ariOus federal -agencies.

tkime s indficienNeiresutt'in

Identification
(1) (2) 4,' !ask Force and , Issue MuMber. InfOkmakitmaGap.Descriptor

124) PPAV 6, There is a lack of budgetary'

accountability for the'expense.

of copying equipment resulting

in inefficient procuresient of machines and uneconosid use. r, 125) rni,1 The decentralized structure Support' Services Structure of Federal travel procurement

results in fragmentation and

higher travel costs..-

JUnctional Area Support Servers

three -Year Savings (S)

Revenue'. Enhancement (R) Cash ACCeleration 10)

Primary Problem Area '($ Millions)

. Identification ' $ 327..7 (S)

126) TM 3

127) TIM 4 4,

192.

The'gOvernment does not gather Support Services Structure

accurate and timely information

on shipmentiby all agencies.

Thus, the government canna

optimize the efficient flod of

freight and take advantage of its

size to obtain, the lowest'cost

Q. carrier service. .,

. . . *

.)11,'/1N' v . GSA CannOtjeoperly evaluate Support Services' Structure / *.' the performance of its rate

,

,,, audit ,activity. As a result,

government recovery of 'freight

rates overcharqat is very low

unin.Conpared with the private

secbar. . Total Cost Saving (S)

Total Revenge (R)

- w

Total Cost Savings and RevenUe

memo: Total Cash Acceleration (CA)

984.0 IS)

529.6 (S)

165.2 (S)

573,457.9 (S)

5,140.1.1R) rylI

VIAINLIt

$17,127.0 (CA)
OPSiCC ISSUE SUMMARY: INFORMATION GAP

.TASK FORCE REPORT: Depar-tMent'Zf Agriculture:

ISSUE NO./TITLE: AG 2: Management Information

DEPARTMENT/PROGRAM: Farmers Home Administration

PAGE REFER CE [REPORT (R)/APPENDIX (A)]: 11

'THREE- EAR SAVNGS

FUNCTION/CATEGORY:

illions): $ 61.1 (S) (I: INFO ALL)

$178.0 (CA)

0 . F nancial

IPROBLEM CLASSIFICATION: ADP

S. -BACKGROUND:

4) The Farmers Home Administration (FmHA) is reslionsible-for

administ4ting loan and grant programs to rural Americans. Total

loan and grant amounts in fiscal year 1981 were approximately

$13.9 billion. There is an overall deliquency rate of 43 ..percent

in the farm loans programs. . .INFORMATION GAP PROBLEM /CAUSE /CONSEQUENCE:

Despite the fact'that the Finance Office generates approximately 425 management-type reports, in addition to the reports

filled out by field officers, important information concerning

the -condition'of the portfolio and boerowers2is extremely difficult.to obtain. Iriformlrh relating to the "aging" of the

portfolio and the number potential borrowers eligible lor

graduation is not available. Delinquency reports are neither;

timely nor accurate.. There arq many itist,ances. of duplicated

information, reports an, data Lathering by the Finance Office.

These information inadequacies are, the results'.of an inef- . .fective informti:on system. There have:jaeen problems arising from

the gency's tremendoUs growth as well 'as its. current organitati nal structure.

As a result, the*Ageecy is Seriouslyhampeied,in its ability.

to manage its receivable* effectively: ,The delinquency rate

percent) is excessive as opposed 'to that of commercial lenders

(2-3 percent), as well as that experienced by the Agency in the

past (10 to .18 percent in the early 70'6). '

21,

, 0
PPSSCC ISSUE' SUMMARY': :INFORMATION GAP

I TASK.FORCE REPORT: Department of AgriCtilture.

ISSUE. NO./TITLE: AG 9: Update FamilY Makeup

for. Thrifty Food Plan

DEPARTMENT /PROGRAM: Food and Nutri on Services/Food

- Stang) Progra

PAGE REFERENCE ['REPORT (R

_ . THREE-YEAR SAVINGS (S millions

FUNCTION/CATEGORY:: Program

X (AY]: 47

.3439.1 (S) (I: INFO)

PROBLEM CLASSIFICATION: Identifi at!iOn.

BACKGROUND: -

The.feod stamp programilielps 10w7intome consumers buy, more

food of greater, variety to improve their diets. A bout 22 millionpeople participate in the food stamp-program. Current expect.dif:

tures for ,the .food stamp peogram are over,S12'billiemt The

benefit allotments are computed according to a standard

size of fourk.-with particular age and sex characteristics:

) INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

3 The Department of Agriculturedoes not use currently

-curate statistics in its calculation of benefit allotments for i. the food stamp'program. The program is still operating with the'

family charatteristics determined in 1971 that weretendedtb

reflect the average- recipient household at the time. ',However,.

today's participant/household charateristics are very d'i.fferent

The average f000d.stamp household now consists of,orqy 2.6 individuals, not the original' four. The age and.sex distribution

characteristics are also quite different from those Originally

determineb in 1971.

Much attention is'focused on finding the nutritional requirements per individual and updatimi_allotments to reflect the

impacts of inflation. While `these latter IdIctors:are. impOrtant,'

the DOA, has not focused on the changing age and,sex characteristics of participants, lectors which have a largeimpact on

resulting benefits.

As a,reSult, benefits are distributed which are 'well.beyond

stated requirements.

22

1 195

ti
RPSSCC ISSUE SUMMARY ':INFORMATION GAP

N TASK FORCE REPORT: -Department-of Agriculture

ISSUE.NO./TITLE: AG 33: Improve Credit Evaluation Practices

DEPARTMENTIPROGRAMv- Foreign and___Domestic Commodity Programs

4 `J PAGE REFERENCE (REPORT ,(1)/APPEN6IX (A)): 146 .

THREE-YEAR SAVINGS ($ millions): NT , FUNCTION/CATEGORYv Financial

. . PROBLEM CLASSIFICATION:

01

,BACKGROUNQ:

Identification

0

/ The Foreign Agriculture Service .(FAS), through the.Commodity

Cedi.t Corporation (CCC), grants CreditAUarantees to borrowers

wh(tpurChas4 US agriculture goods. .The guaranteeicovers up to

(0,percent_of the _total_ principle amount. The technlcal borrower

is a fceign bank that oPens a1etfe-i7df-tre7dft-on-behalf-of- the

8uyer.,of the goods, handled by a US bank .that lendS the total:-

Mount of principle whe all of the requird dodumentatibn

sown to be in good order. CCC guarantees up to $2.8 billion in

Joans each year. Since the guarantees are given for a. maximum of

three years, the maximum average guarantees outstanding could

J.-reach approximately-$5billion per--year.-'

INFORMATION... GAP PROBLEM/CAUSE/CONSEQUENCE:

:The present-system of establishing individival loan limitS

for foreign bank borrowers uses ,neither complete dor accurate

iformation.: The _sole consideration for determining the indi-r

vidual loan. limit is the net worth repOrted by, the borrowing

--10.1, bank.. Vaeiables:that shoUld be cogsidered but are not, include

.1eVerage, reCurn.ori.assets, policy of bank On lending soft cur-,,

rency, reserv fore -bad debt loans, and usage of--other bank lines.

When the most recent finandial statements are not available, the

agency refers to adirectoey which contains statements that are

often one year old. FUrthetmore,'the exchange rate used to

convert, the,net Worth figur4 from the iocal,currency to US,dollars,is usually'outdated,-and no effort is made to obtain a more

sE current exchangeate.'

fz4.1*4-` Part df tgepioblem is the bifurcated management stajailkIr

used to perform co try risk analysis, bank analystl.

establiAment c-f 'gdli-Lantee limits. Also, the prcgr tInues

to allow .foreign banks operating in the US to lonow, er anks

in their pun6,ky.,of origin. In these cases the foreiginiumm

operatiri 3n the71.15',,are pot capa,ble-oiobjectively ascertaining

the count- riskpfdoing business in its own coubtry or origin.

23

19f . NA
.PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT.: Department of the Air Force.

ISSUE No:/TITLE: USAF 13': Automated Data Processing . . Modernization ,.. . f .. DEPARTMENT/PROGRAM; Air Fdrce Logistics Command (AFLC)

. . . 7

PAGE REFERENCE (REPORT (R)- /APPENDIX (A)]: 117 .(R)

THREE -YEAR SAVIIIIGS ($ millions): $580.6 (S) (I: Info all'-)

11. FUNCTION/CATEGORY: Materiel

PROBLEM CLASSIFICATION ADP

BACKGROUND:

AFLCis--respomsible. for a $24.5 billion inventory. During

the first half_Pf_n_1982÷-itreceived:and proCessed 2.5 million'.

i-equisitioffsr procured $5.4 billion in materials and services:

and managed aver 900,000 items in its inventory:- AFLC employs. approximately 92,000 people, of-whom 82,000 are Civilians. ADP

equipment is. of vital. importance to AFLC in performing its work.

As of 1982, it managed 104 computer systems.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

AFLC data processing systems are archaic and coStly,to main -

tain, and they'do not provide the up-to-date accurate information

necessary-for inventory control and other logistics functions.

The effectivenirs. Of thfil ADP\systems is unknown. Measurements'

seldom take place at the user level in terms of function, financial impact, and time frame.

lo,

is is.fargely attributed to the overly, autious attitude

throughout the command.. The deCision-making process is'slow,in

implementing solutlont or' evaluating results and as,a result defers decision-making. Modernization programs. re.;further inhibited by the fact that procurement' rocurement typically. involves a twn

to three,year process.

\ As a result, the neCessgry information is lacking to manage

inventory'controls and distribution, tighten resource

assignments, and manage the mission capability of aircraft.

Working with obsolete.hardware and software has cause&a decline

in technical skill levels of the ,associated .Air' Force personnel.

24

19.7
PPSSC rSSUE SUMMAR#: INFORMATION GAP

4

TASK FORCE REPORT: Depar/tment (DE the Air Force

ISSUE No./TITLE: USAF 16: Spare Parts Breakout

6EPARTMENT/PROGRAM:./' Air Force Logistics Command (AFLC)

PAGE REFERENCE (REPORT (R)/APPENDIX (101: 339 (R)

THREE-YEAR SAVINGS {$, minions): $689.4 (S) (I: Info'ab.)

FUNCTION/CATEGORY: Materiel

'PROBLEM CLASSIFICATION.: Quality

BACKGROUND:-

t T The

,

. Air:ForCe,,'Systemis Command (A.R5C).:is charged with the

initial.production,Ohase/df a,weapons_system. Once system is

delivered,AFLC-beeoMes responsible for procurement of all

replenishment apare parts. AFLC current1 manages 900,000 items

with an inventory of reco'verable and consumable spare parts

totalling $17.4 billion in acciuisition,dollars as of Septemdiei,

1981.

INFORMATION'GAP 'PROBLEM /CAUSE/CONSEQUENCE:

During the weapons system's acquisition phase, Aksc does not

,obtain the reprocureMent engineering/technical data before the

system is transferred to the .AFLC. Once a weapons system is

.A0 transferred to AFLC, technical data costs' can be Wilehibitive. - AFLC. has no barga Wng position since the acquisitionphais se is

+n ,r. Most of the critical decisidns pertaining to the ', techniCal ddta,,have already been made including the determination

as to 4hether,an item can b% reptocured competitively.

,*

,

. Part of the problem is that portions of the Defense Acquisition Regulation System dealing with patents, data and copyrights,

contain language that restricts.he Governmentis use of technical

data necessary for competitive reprocurement.

As.a result, less than 25 percent of replarria ment spare

parts have been competitiVely procured. Those aw ds that are

competitive are hindered by lack of data to'caretul,ly screen fdr

quality, reliability, performance, and.timely delii/ery. Therefore the overall effectiyeness as well as the -cost-efficiency is

hampered.

00/

25

198
ii

PPSSCC ISSUE SUMMARY: INFORMATION GAP

/ . TASK FORCE REPORT,: Departrrient qf the Air Force

ISSUE No./TITLE: USAF 20: Dual-Sourcing

DEPARTMENT /PR'OGRAM: U. S. Air For6'e

so PAGE REFERENCEIREPORT (R)/APPENDIX 4A)): 4.1,78-( )

. , . :,

THREE-YEAR SAVINGS ($ millions_): $2,422.1'(S) (I: Info all)

-. FUNCTION /CATEGORY=. .Materiel

PROBLEM CLASSIFICATION: Ident)ficatiOh

BACKGROUND:

t..

Dual-sourcing is the process. of dividingthe Pk)duction

between two contrac.tors and awarding t)rodpction quntities oh.the

basis of the quality.and cost of their products. It an

effective method to introduce competition at'both the prime and

subcontractor levels. Dual-sourcing shlomld generally be pursued

when the quantitis, rates,.costs, and potential saillings are

appropriate to support more than. one supplier. PDis'Areement

exists on the amount of savidho.damilwAthetcriteria used to measure

savings afforded by dual-sou

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

There is no .readily available data base .in the, Air Force to

indicate usage of dual - sourcing or resultant,advantages or disadvantages. No formal methodology currently exists for evaluating

dual-source opportunities or for 'compiling the, necessary

empirical data to properly analyze past acquisitions.

There are specific barriers within the Air Force which.dis-'

courage the use of dual-sourCing: it requires additional funding

in the near-term,.and dual-sourcing is considered an exception to

the normal, competitive business practice. . As a fesult, the Air Force is not taking adequate advantage

of dual-sourcing opportunities and is therefore losing many

significant cost-saviOgs opportunities.

/

26 199
. - PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Department of the Air Force

. 010. IS SUE No./TITLE: USAF 22: Air Force rProcurement.of Consulting,

management, Advisory 'services and Research

.DEPARTMENT /PROGRAM: U. S. Air Force

PAGE REFERENCE [REPORT (R) /APPENDIX (A)]: 1.95 (R)

THREE-YEAR SAVINGS (5 millions): $227...7 (S) (III: Info plus)

- _ FUNCTION/CATEGORY: Materiel,

PRO LEM'CLASSIFICATION: Quality 4

BACKGROUND:

. ..:The Air Force employs consulting services to-"assist in

research, studies and anayses, management support, and technioal',

representative actfivity. OMB Circular A -120 sets ExeCutiv4 " _ Branch policy for consulting services. For more than, 20 years, 'a number.of abuses in consultant procurement half been identified.

In particular,' the Department,of Defense hai had the highest

percentage of noncompetitive procdrements iR ekcess-Tof .510,000. . DOD'S almost exclusive use of sole-source iwardb resulting from

unsolicited proposals is counter to-.accepted contracting,

procedures, subverts competition., encourages work., that may not be

important relative to DOD's mission needs and priOrfties, and

,ultimately abrogates DOD's responsibilities.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE.:

The Federal Procurement Data System can hot identify how

many consulting service contracts the Federal Government .has,. and

at what cost. In the area of studies and analyses, it is

cult to determine whether there is duplication of effort because

only 25.percent of all studies are qer reported tq the Defense

Technical Information Center. Additionally, the Comptroller General knows that Federal agencies have neglected to search repositories before initiating new work.

There is no lack of rules, .but there, is a lack of effective

control and .a.uniform management system over contracting. There

is no entity that has clear-cut authority to impose and enforzeta

system of controls over Circular-A-120 procurement. .Sithikarly,

there is also a lack of clear,defipit,epens governing the 'services,>/'

contracted.,

e 1 [..GpNTINUED ON NEXT PAGE]

s 27

200
I INFO'GAis: iJSAF 22 f CONT'D)

% As La result, too many contracts are ioie-soUrced often and ,ire too based.ontunsO4cited.proposals: consultants frequently'

are repeatedly reftewed

undertake projects that could'be . one in-house: .service contracts

tive and irrelevant without .04loving-lternatiVes: duplicaproblems

studies are often authorized. Each of these leds to unnecessary a

. and/or excessive spending.

I.

41.

L J

28 '

11,
PPSSCC ISSUE SUMMARY: INFORMATION GAP

.

,

..: . . .

, TASK FORCE REPORf:J.Departmentlof. the'Army

1

i ISSUE No. /TITLE: .. ARMY 1: Recruitient.Training'and

\ Disp.ibution'of New Enlistees

a

DEPARTMENT/PROGRAM:*.OperatiOns, Training, Recruiting and

Perappnel -4

a PAGE REFERENCE [REPORT (R) /APPENDIX (A).]: 8 (0

THREE-YEAR SAVINGS (S. $189.5 (S) (I:. Info all)

FUNCTION/CATEGORY: Personnel

-PROBLEM CLASSIFICATION: Identification

BACKGROUND:

The Army's total personnel costs are $17.3 billion and

represent 29 percent.df the FY 1983 budget. The Armyiallocates major resources to recruiting,: training-, and distributing.initiAl-entry personnel. This effort is accomplished by several commands and agencies. A .number of

specific activities are performed. Requirements are determined, civilians are recruited to meet those requirements,

the new soldiers are trained in the requisite skills, and

the newly trained soldiers are assigned to field units.

There. is an individual, command Or agency. .involved in each of

these operational aspects of the process. In FY 1981 $4.5

billion was spent for -individual training, 2024600 recruits

entered basic training, and $700 million was spent on

recruiting.

INFORMATION GAP PROBLEM/GAUSE/CONABQUENCE:

It The computerized systems that now support the allocation process have serious 1,:deakneloses in data base quality,

system structure, and user involvement. Further, the.Army

does not systematically analyze results'in recruiting,

training, and distributing.

This weakness is the result of the la'ck of a

roordinated process to determine requirements, and of

ecruiting, training, and distributing initial-entry

enlisted perSonnel.

) [CONT'D ON NEXT PAGE]

29

202

'441
.

. INFORMATION' GAPIARMY 1 CONT'D)

t

Asa -resille, there is a- continuing inefficient use .of

-train -e8 soldiers. FOr-example, 58 percent of a sample of

fitst-term soldiers assigned in bulk to Europe were further

tassi4ned-16 coMTandi that did not have a need-for their

or'to positions not commensurate with thbir skills.

This,resurts in waste-in unused programmed training

capacity... The Army his prOgramTed more training than

required ,yet expeiienCed l4ss actual input to training than

regaired. .The Af'Sly'.s functional effectiveness is

commensurately reduced.

aw.

. , 30'
PPSSCC ISSUE.SUMMARY: INFORMATION, GAP

(

TASK FORCE REPORT: Army

ISSUE No. /TITLE: ARMY 4: Learning Resource ,Centers

DEPARTMENT/PROGRAM: Deputy Chief of Staff for PersOnnel

^/A a PAGE REFERENCE (REPORT (R)/APPENDIX (A)1:. 65 '(P1

#

a

THREE-YEAR SAVINGS ($ milPporis): S13;7 (S) (I±14: Info plus)

)

FUNCTION/CATEGORY: Personnel

PROBLEM TLASSIFICATION: Identification--;

9 0

--\.`=.\, BACKGROUND:

_:,.The Army supports 25 Learning Resource Centers (LRC) and is . . in the process of adding nineteen. The civilian personnel off

at the Office of the Deputy Chief,of Staff for Persdrinel has

.staff responsibility for theSe centers. 'Learning Resource

Centers provide a w-jde range of training intended to promote

realistic career and Self=development activities and opoortuni- _ ties for both military and Civilian persOnnej. There are over

125 courses-offered.

INFORMATION GAP `PROBLEM/CAUSE/CONSEQUENCE:

The civili'an personnel office:atthe, Office of the Deputy

dhief:of Staff forPersonnel, which has- staff resOonsibility for

these centers, dOes-nok:have adequate informatiOn on,,how much

these centers cost to operate.' A one time study performed.

estimat. the annual operating costs for the centers totalled

$19.9.m 'tor?. No reaiO has been given for the lack Of, management information on the. cests of this program.

As'afresUlt of the lack ofainformation regarding costs, it . is impossible to measure the effectiveness of the accomplishments

or the efficiency of the operation. There is little justification for the expenditure, ather'than the desire to have an inhouse employee training.peogram.

4
PPSSCC ISSUE SUMMARY:. INFORMATION GAP

TASK FORCE REPORT: Army

1 ISSUE'No./TITLE: ARMY 10: Major Wea0ons Systems Acquisition

DEPARTMENT/PROgRAM: Department of Defense and.Army

PAGE REFERENCE (REPORT.(R)/Al'PEND/X (A)): 69 (R)

THREE - YEAR SAVINGS (S million's):` S1,563.8 (S) (II: -Info only)

,FUNCTION /CATEGORY.: Materiel

PROBLEM CLASSIFICATION: Identification

BACKGROUND:

The Army pearls to spend more than S9 billion in FY 1981 to

research, develop, and prOcure major weapons Systems. Currently,

.fourteen of these sys -tems are of sufficient interest that

Congress requires a quarterly report on their status; these

reports are called Selected Acquisition Reportil (SARs). When:the

individual systems were originally approved fOrdeveloothent (most

between 1972 and 1975),, their estimated aggr4qate life-cycle cost

was $30 billiOn.and as of June 1982, this estimate had risen to

S82 billion. Although the SARs provicle the most official set of

cost growth numbers,, the measurement of. Cost growth is inaccurate. 'Costs are unadjusted for quantity change.leading to cost'

variances im the same program of hundreds 6f millions of dollats.

The costs are often not adjusted for Inflation and when they are,

there Is often a great difference between the actual inflation

, rate and:that promulgated by'OMBfor cost estimating purposeS.

These reports do not properly differentiate cause and effect;

therefore, Congressitnal, OMB, and project, manager decisions are

not separated in reporting the reasons lor cost growth.

The reports are prepared in this fashion because of directives that the Army receives from Congress and OMB. The cost /-

variance categories dictated to them reflect only causes of cost

growth or -decline, not effects. FUrther, the cost /variance

categories do not differentiate between cost growth or decline,

as a result of decisions internal to the Army versus decisions

external to the Army.

As a result,-the Army is recording unrealistiC estimations

of program costs. These reports can lead to.indorrect,conclusions regarding'cost overruns and-cost growth.

32

20.5
ar. PPSSCC ISSUE SUMMARY: INFORMATION GAP,

TASK FORCE REPORT: Automated Data Processing/Office

Automation,

ISSUE No./TITLE: ADP-1: Federal ADP Leadership and

Direction

DEPARTMENT/PROGRAM: All Agencies

PAGE REFERENCE [REPORT (R)/APPENDIX i, 8 (R)

THREE-YEAR SAVINGS ($ millions):

FUNCTION/CATEGORY:' Materiel

r. PROBLEM CLASSIFICATION: ADP

BACKGROUND:

The,Federal GoverneMnt employs. two hundred fifty - thous d,

people .to run its 17,000 computers, about 45% more people th'a't, on

the total employment rolls St.Exxon, the world's largest

industrial, company'. Total cost to acquire,'maintain, and operate

.the Government's computers is $12\billion a year.

INFORMATON GAP PROBLEM/CAUSE/CONSEQUENCE:

, Many of the.Government's 19,000 computers are incompatible;

they can't talk to and another in order to share data - for

example, to .check transfer programrecipierks' incomes (IRS°

.computers) with:eligibility requirements (HHS computers).

Thus, when one agency has information useful to another'

there is an'lnformation gap preventing the. transfer of much data.'

This reSults'in Federal entitlement programs being routinely.

defrauded. O a In New York alone., the regional office of HHS uses ten'

different kinds of incompatible computers.

" 206

L
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK

rFORCE REPORT,

/ ISSUE-No./TITLE:. ADP jlardwste And Sdftware-Resourc.es

Hanaqemeri

DEPARTMENT /PROGRAM:. Government -wide

PAGE REPERENCE'CREPORT (R)//APPENDi)0A)1:, (1)

THREE YEAR SAVING$ (S) Info: plus

Automated Data Processing/Office

Automation

FUNCTION/CATEGORY: Materiel . PROBLEM-CLASSIFICATION: Identification

BACKGROUND: .4

Y,

a

! From the massive transaction processing actiVIties in agencies like .the Internal/.Reenbe-Service and the Social 'Security

Adminietration;to military Command. and control- systems,..the

Government depends on automated data processing .(ADP) systems

In FY 1981 On estimated `$12 billion was committed to acquirina

and operating theSe *Stems. However, the_Federal ADP establishment lags far.behi,nd-the priyatesector in its use. of current

information technology.. Equipment is Cbsolete, and hardware

maintenance is labor-intensive and requires the retention of

Federal personnel trained in maintaining hardware no longer

supported by the manufacturer. The Government maintains

.approximately 1,000 different,operating systems requiring highly

skilled., technical.perso4nel.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE: "ft General bardware and softWare statistics and characteristics

are not available frOmcOny one source (Office of Management and

Budget, General,ServiCes Administration, or the General

Accounting Office),'. The overall costs associated with hardware

maintenance and'olOiading are not known'elther.-.

As a result,,it becomes difficult to manage the various ADP

systems currently in use. Effectively updating and maintaining

hardware and Softwareia Also hampered.

34

20'7
PPSSCC ISSUE SUMMA1It RY. ....L.ORMATION GAP

TA51( FORCE'REPORT: Automated Data Processing/Office ':,, / Automation

ISSUE No./TITLE: ADP 5: Teleprocessing Resource Management

DEPARTMENT/PROGRAM: Government-wide / / ,e,

r ?AGE REFERENCE [REPORT (R)/APPENDIX Id]: 56 (R)

4 if . THREE-VIM SAVINGS ($ millions): $517.0 (S) (I: Info all)

, FUNCTION/CATEGORY: Materiel

TROBLEWNASSIFICATION: Quality `"e

.::, $ACKGROUND:-.

. . P -... '54 ' : .; .1. .-eleRrocessimig4TP) is a rapidly growing, integral component

of federal- ADP st". In FY 1981 total. TP expenses were

apRIk.Xim'ately.$6Wttiliion.. :TP expenses are expected to be olier 4

::::: '$1 billion in.FY0/ due to ihcreased circuit 'utilization and

rising costs of 44pitment and services.

INFOR4ATIOVGiP PROBLim/CAbSE/CONSEQUENCE:

. ". .. ..-e5ttiOs,rde cost is not documenttd,.separately: it is usually

;4y-.L. ;tketotal telecommunication budget. The budget.

,:l 4merft:for-telecommUnications does not allow for identification

.4160(41.1antiflation of specific TP budgets. There is no central

V tjOentory oki!TTatiOlications. With shared TP circuits, little

'454e,RE. is Ifias,.tb allocate end users' levels of utilization and

:':1 ."-v:';

'ti:,-

h: :1', .. :

, -.

;.,I,9P',.:

1... ,

tr; -.- 1.11.t',there is lost opportunity to investigate and , r .: , ilF: /,,.. . , 4A ç'r,atives1 applications, sharing of communication .'* , ,or r-N4, ' M411 e'N

E..'

, ...1!,4 of scale,

Alikl..-z-, .;:jr,,,11;(.,, *.,7*.",-!*....,..

-. P %..4/. :, ..,,,.... ., .' ','. : f.,

,... 4t1.

Th

35 208

rrr
PPSSCC ISSUE SUMMARY: INFORMATION GAP

,TASK -FORCE REPORT: ,Automaied Data Processing/Office

Automation

ISSUE No./TISLE: ADP 6: Office AUtomation

DEPARTMENT/PROGRAM: Government-wide

PAGE REFERENCE [REPORT (R) /APPEND?X (A)]: 64 (R)

THREE -YEAR SAVINGS ($ millions): $6,537.0 (5) Info all)

FUNCTION/CATEGORY: Materiel

"4, PROBLEM CLASSIFICATION:

BACKGROUND:

a Analysis

Office automation refers to word protess,ing electronic

document storage and electronic mail and thejntr'connected

networks to make appropriate information available when, where

and in the form in which it is needed Federal budget estimates

for officeautomation costs are not a ailable. Existing studies

suggest that the'Government might look to the private sector's'

experience with offite automation for cost savings and productivity improvements.

41 ti,,N 'INFORMATION GAP PROBLEM /CAUSE/CONSEQUENCE:

1 The Federal Government has no organized system to enumeipte,-

inventory, or account for the costs, benefits, and charactLIS

tics of its office automated equipment.

This is due .to the fact that the potential savings and

ductivity benefits of offie automation applications

hay.e not been fully understood nor fully exploited within t.he'

GoVernment.

As a result there is a proliferation of procurement of:duplicptTve or incompatible office systems, while at -the saMetime

other equipment may become underut'i'lized.' NO longrange

strategic planning. to meet overall needs, occurs, causing

procurement to be fragmented,' with users unaware of'aUtomated

office equipMent already in existence and unable to coordinate

current or future procurement.

36

209
) )

PPSSCC ISgUE SUMMARY:..'TNFORMATION GAP

emax TASK FORCE REPORT: Automat d data Processing/Office Automation

ISSOE No./TITLE: ADP 10: Improved A151, Management and:Planning'

dEPARThENT/PROGRAM: Department of the hcilly , PAGE,REfERENCE [REPORT (R)/APPENDIX (A) 1.: 125 (R)

THREE-YEAR SAVINGS ($ millions): $827.5 (S)

FUNCTION\CATEGORY: Materiel

PROBLEM CLASSIFICATION: Identification

BACKGROUND: C.

kelikspending on ADP is estimated to be $2.5 to $3 billion

in FY 1983. Although the Army is highly dependent upon

automation to fulfill its mission, there is no clear organization

structure for ADP /OA in the Army.'

INFORMATION GAP PROBLEM /CAUSE' /CONSEQUENCE:

. There is-no specific budget line item for ADP in the Army

management systems and precise figure's are unknown. The Army. is

not sure of exactly how much. it spends on ADP/OA.

x This is n'ot surprising Since the Army doesn't knc.., what

kinds :end fol:;mb, of computers it has, where they are locatedr

whether they should be replaced.

37

4''

210.
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE. REPORT: Automdted Data Processing/Office A)mation

ISSUE No./TITLE: ADP 15:. Automation of Claims and Benefits.. ... . Delivery Systems . DEPARTMENT/PROGRAM: VA, HHS, DOL, SSA, HUD

-qp PAGE REFERENCE [REPORT (R)/APPENDIX AM.]: 163-166 (R)

0 THREE-YEAR SAVINGS ($ millions): NQ

FUNCTION/CATEGORY: Materiel

PROBLEM CLASSJFICAT'ION: Analysis

BACKGROUND: C

Several Government agencies support very large efforts in

the areas of claims, benefits, and compensation. These incrude

VA, HHS, DOL, SSA, and HUD. DeSpite automate(' supnort, many of

the systems which process, laims, benefits,, anu compensation ark

still labor-intensive.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

Obsolete and antiquated systems/cause delays in obtaining

data from sources outside the particular responsible agency and ' slow access to status information.

Conse

o fo

ca

th

an

uences at'SSA alone include:

r to six week delays in issuing new Social Security

ds;

ee year backlogs in posting retirement contributions;

'inability to process 7.5 million new annual claims

applications on time or correctly.

Generally, the old equipment impedes access to,,,,needed

information andigrevents ongoing computer matchingAo uncover

frauds and' abuse4.

38

211
PPSSCC ISSUE SUMMARY:, INFORMATION GAP

T

TASK F2RCE REPORT: Data ProcessinghOffice Automation

ISSUE No./TITLE; ADP 17: Productivtty Improvement: IRS

DEPARTMENT/PROGRAM: IRS

PAGE REFERENCE (REPORT (R)/APPENDIX (A)): 172 (R)

THREE-YEAR SAVINGS J$ millions): NQ

FUNCTION/CATEGORY: Systems

PROBLEM CLASSIFICATION: ADP

, BACKGROUND:

The IRS Mission is to achieVe the highest po)sible degree of

voluntary` compliance with the tax laws and regulations.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

The IRS estimates that in the :tax year 1961 thle gross-tax

gap (taxes due but not reported) from individual and corparate

returns, nonfilers, and the illegal sector was at least $97

billion.

The information document matching prograP m has hd some

success in limiting the tax gap, but millions of infdrmation,

returns (about 20 percent of all returns were still not entered

into.the system for tax year 1978.

This delay is caused by inefficient and old equipMent and is

costing the Government billions in uncollected taxes.

39 212. Z.
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPOR: Boards/CommissiDns.- Banking

ISSUE No./TITLE:, BANK 1: Pension Benpfit Guaranty CorpQxation

(PBGC).

7

DEPART NT/PROGRAM: PBGC

PAGE R FERENCE (REPORT (R)/APPENDIX (A)li 5 (R)

THREE-YEAR SAVINGS ($ millions): 4324.1 (R)

FUNCTION/CATEGORY: Financial

PROBLEM CLASSIFICATLON: Quality

BACKGROUND:

si

-"The PBGC Cites taxpayer dollars to insbTe private

pension,funds. In seven years of operation PBGC Mas accumulated

an unfunded deficit of $286 million for 28.8 million '- participants. This breaks dovin to $9.93 per participant, or 3.82

times the current annual, charge' per participant of $2.60.

4 INFORMATION GAP PROBLEM° /CAUSE/CONSEQUENCE:

One out of every three checks PBGC issues is estimated ond

never verified for accuracy.

PBGC is unable to publish verifiable financial statements

despite itsepresentasSet base of more than $500 million.

401

213
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Boards/Commissions - Banking

ISSUE No./TITLE: BANK 4: PenSion Benefit Guaranty Corppration:

Industry.Service&,

DEPARTMENT/PROGRAM: PBGC

PAGE REFERENCE (REPORT (R)/APPENDIX (A)J: 22 (R)

THREE -YEAR SAVINGS ($ $132:4 (RY Info

FUNCTION/CATEGORY: Program

PROBLEM, ADP

BACKGROUND:

The PBGC was established in 1974 by the Employees Retirement

Income Security-Act to insure employees coveredby'pension plans

against plan terminations; as in "insuier of last resort." PBGC

currently administers;.some 880,pension.plans and 100,000 partici-

. pants. The present value of guaranteed future benefits exceeds

the 'value of 'assets available to, pay for those future claims, by

$236 million..

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

... PBGC has insufficient information to publish verifiable

financial statements., In particular, there 'is a lack of:

o i "nvestment accounting and control,

o premium collection, accounting, and,entity control of

reporting /.premium paying plans,

pension payment control and verification processes.

4 This is due to the inadequacies of the internal operational

systems and insufficient'resources dedicated to eliminating' backlogs and plan administration. They have-not been successful in

building,. internally, administrative services that exist in the

private sector. x 4e

As a-result, PBGC is plagued by 'case backlogs.and'operatiOnal diffi ies. Of the cases administered by PBGC, 28,000

pension check distributed'monthly, 'but only 18,000 have been.

. verified a thousand are paid on an estimated

CONT'D ON NEXT PAGE] .

41

214
basis. Anjadditibrial 15,400 checks are issued by a variety of

:disbursemeitservices in amounts that have not been verified.

These administrative services and resultant` insufficient iniormation-have a profound effect on the deteriination of deficits and

accordingly on the level of preMiums charged by PBCC'ovr tinge.

YR
PPSSCC ISSUE SUMMARY: INFORMATION

TASK FORCE REPORT1- Boards /Commissions -- Business Related

ISSUE No./TITLE: BUS-TVA 8: Financial Reporting System

DEPARTMENT /PROGRAM: Tennessee Valley Authority

.PAGE REFERENCE [REPORT (R) /APPENDLX (A)1: :75 (1)

THREE-YEAR SAVINGS ($ millions): NQ

FUNCTION /CATEGORY: Finance

PROBLEM CLASSIFICATION: Quality

BACKGROUND:

TVA's financial-reporting syStem is administered by the

Division of ,Finance, whose Comptroller, the Division Director

reports ,to the Assistant General Mapager'(Administration- TVA l

has three Accounting Branchesf located in Knoxville, Chattanooga,

and Muscle Shoals, which assist ,the CoMptroller in establishing

and administering accounting policy and systems throughout the

TVA organization. . rA INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

N.

A major portion of thd.,finailicial reporting system current.I

used at TVA has been in place since the inception of TVAof the characteristics associated with a mature system. are

present. For example, it has:

o a nonstandard, complex accounting code structure,

revised 'many times over many years to address

specific financial or organizational concerns:

a system that does nottake advantage of current

state-of-the-art computer technology:

o only a few staff who understand the system, r especially from a data processing standpoint:., and

o a general reluctance to "change" the'system

because it is so complex and so large.

s

-;;. , . Recently, a responsibility reporting capability. was added to

the system, but the Task Force findings indicate that user departments below the divisional level are not using the system.

Instead, many departments are Lisingcontrived versions to satisfy

-'. their information needs.

43

216
o 444 4.1-r-N 1..i'

t

As a result,`the TVA. financial reporting saygtem is

cumbersome to ude,, not widely understood anc-4 limited in itsi.

o flexibility. 7 . T 1 _ The incdndisten structure. of tho 'account actourit 'code. Umits .the , availability of a Eeporting and account analysis.- Special'

reports require 1 lead times, and the ability to`mapipulate

ttle data needed to produce repOrta redides with one individual. :

. ,

. .'. Since each respdnsfbility center is iedponsiblefor

tedtabl idtiing function codeA,plet are used to accumulate

activiC4p,;(4esAgnate4 funcfldns are not compaehble amOn4.

respOnS'bilfrtYde'nters:., , . -.. , 1,7,10. A: The Offi'de 410X:s productivity ineapu,rement statistics

cannoe_be qeft#r. (Ili' the present reporting system.. Some oe the

key OffTce o aging objectiQes ind the realization of

:specific "Aea A and .ratios are Ilit t t r d ii t i n e 1 y captured

by' the pre1e/.1*.F.ekOr -dystem: t , .-TVA'appea.4* to -X4V lost coMtl'ol ,of its 'chart f Accounts,

the moat Ct*.tiCA4 g'Qt of a good financial reporting system..

2.Pinandial,,reportipg VKconsistencies are prevalent. The same

elements Or the7aCcotiWOri'aing structure are used for multiple

:purposes. Sri:01144r types of information are captured by different

account -iplements._ ,F4t0er development of this account, numbering

scheme wi14,404"t9r more inefficiency. TVA would be faced

with a rri4jo.;4014*.°4** present reporting structure or

requirement's-keWAttit*7idi f ied.

:: :. ,N;;.,1.;7-

441'.

217
iigtCC ISSUE SUMMARY: INFORMATION GAPS

TASK FORQE,.RgPOWT: -Department of CoMmerCe.-

ISSUE No. /TITLE : COMMERCE 5: Ecohomic Development

Administration Debt. Collection

DEPARTMENT/PROGRAM:'Economic'bevelopment 'Administration

(EDA)- . ' P----, ,3 I. , -..

_., 0

PAGE REFERENCE (REPORT CRY/APPENDIX .(A)]: 62 (R)

'THREE-YEAR SAVINGS ($ millions): $ 3.-3,(S) (I; Info all)

$15.0 (CA)

FUNCTIONYCATEGORY: Financial

PROBLEM CLAISSIFICiiTi6N-:

,BACKGROUND:

The EcOnomic.'Development AdminiStration.GEDA4

adminiSterSsmore .than,:tenrdifferent grant, loan,.and'lpan

-guaranteed Programs aimed at alleviating unemployment and

lowjaMilyincoMe, EDA:cUrreptly has approximately 500

employees:541,31ashingtoriand 6 regional offices: In irk,

theyedminiStered.,4 portfolid of $1 billion in business

loans .and loan 4darahtee'S of. which. 41 perCent were

delinquent..

INFORMATION GAP PROBLEM /CAUSE /CONSEQUENCE:

. , EDA' buSiness lOans infOrmatiori System has-a-number of

,deficienales., Financial statements are generally conta.ined

. : :im-the.files,- though, phere is inadequate reporting for

purposes -of analysis of...the portfolio. Overall 4 documentation in the fileSyis,,:ofte6 incomplete.. COhtactS

with boirowers ere often not recorded and various loan - . documents are .often missing. kpartictilar shortcoming of

the ststein is. that: it dbes provide for th4,, %tracking of

'deerrals:granted in'principal and4p,r'intelOest payments..

The number or amounts of loans Oathave been granted

deferralS is not;,Monktored 'bIrihe sys'tern.

ECONT!D ON NEXT PAGE.)
INFORMATION GAP (COMMERCE. 5 CONT D)

This situation has developed because the processing of

new loans is a more importarit priority than loan servicing

both, in Washington and EDA's re onal offices. This

consumes substantial time in onriel resources which would

otherwise be dedicated to the bt collection .adtivity.-

As a result of the shortcomings., the quality of the

portfolio is not kno n and is no analyzed and the number of

delinquent lbans is I-excessive. Improving the debt

collection procedure could make new funds a ilable for

allocation to qualified recipients.

4
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: .Commerce

ISSUE NO./TITLE: COMMERCE 5: ECoOomic"Development

Administratioh (EDA) Debt Collections

DEPARTMENT /PROGRAM: EDA

PAGE REFERENCE [REPORT (R)AAPPENDIX (A)J: 57 (R)

THREE -YEAR SAVINGS ($ millions): $ 3.3 (S), (I: Info all)

$3,5.0 (CA)

TUNCTION/CATEGORY: Financial

PROBLEM CLASSIFICATION: ADP

BACKGROUND:

The EDA makes direct loans to businesses and. guarantees

other loans made by banks to businesses. 56% of all EDA's

direct loans and guaraptees - about $35.0 million - are

delinquent' as of 1982.. Of that, 77% of $270 millkon has

been foreclosed, and'iS being sold.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

EDA suffers from a lack of formal procedures and

inadequate documentation for analyzing borrowers' economic

health.

Clearly, EDA lacks adequate information concerning -its

borrowers to justify loans - and the result is an appalling

rate of bad loans and delinquencies.

4 22.0
PPSSCC ISSU8SUMMARY:, INFORMATION GAP

TASK FORCE REPORT: Office of trle Secretary of Defense

ISSUE No./TITLE: OSD 2: Improved Inventory Management

DEPARTMENT/PROGRAM Department of Defense

OAGE REFERENCE [REPORT (R)/APPENDIX .(A) 61 (R)

THREE-YEAR SAVIV4S ($ millions): $6,0740fAS) (I: Info all)

FUNCTION/CATEGORY: Materiel

PROBLEM CLASSIFICATION: ADP

BACKGROUND:

As of September, 1981, DOD reported z secondary item

inventory of about'$40 billion (excluding fuel and subsistense

items). Secondary items include assets such as spare parts,

medical supplies, and operating supplies. This category exclude&-

weapons, ammunition, and air craft engines, which are-constdered

- piincipal items. Inventories at the Wholesale level are stored

in'about30depots around the country. Inventories at the retail

level include both on-board.ships and on numerous military bases.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

Information for the management of inventory is not;accurate

or timely. The inventory data systekis for each of the services

and Defense Logistics Agency are not compatible.

1 The primary. constraint is an out-'dated AD? system which

creates problems in frequent down time, lack of available running

time, oa.nd 'generally poor service to end users. The equipment is

obsolete and requires excessive running costs. Previous DOD

efforts to modernize this ADP hardware, and software have been

frustrated by time-consuming and inefficient ADP procurement

procedures.

As z result, inventory management decisions are sup-optimal:

Stocks are not baDanCed and there is often excessive stock

build-up, unneeded inventory investment, and excessive

.obsolescence.

221

48

s-
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FQRCE REPORT: Office, of the Secretary of Defense

ISSUE No. /TITLE: OSD 19: Department of Defense Laboratories

DEPARTMENT/PROGRAM: DOD,

PAGE REFERENCE [REPORT (R)/APPENDIX (A)]: 165 (R)

THREE-YEAR SAVINGS ($_millions): $1,593.7 (S) (I: Info all)

FUNCTION/CATEGORY: Materiel

PROBLEM CLASSIFICATION: Structure

BACKGROUND:

Approximately, 75 DOD laboratori s provide technical support

to the research'and development acti ities in the weapons system

acquisition process: The labs identify and exploit pew

technology and support DOD in adquiring outside research in

developing technologies. In FY"1980.total \laboratory ' expenditures for all phases, of research:and development totaled

$7.4 billion, of which only $2.2 billion represented in-house

research efforts.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

The services do not,have adequate, regular information on

emerging technology developments to apply to t'he appropriate

phasesof the weaPcins-acquisition process. Presently only the

early development phases have visibility across all services,

through inclusion in the Defense Technical Information Center

data base."

The problem emanates from the fact that no centralized,

Coordinated effort to disseminate data exists.

As a result, prior work is not always fully utilized and is

sometimes repeated. The operational forces lack .full'

understanding of the. Tiotential value-and limitations of emerging

technologies before they commit specific technologies to weapons

, systems programs. Engineering development is not cost-effective.

49

222
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT; Office of the,Secietaryof Defense

ISSUE. No. /TITLE:. OSD 22: Estimating Weapons Systems Costs

DEPARTMENT/PROGRAM: DOD

PAGE REFERENCE [REPORT (R)/APPENDIX (A)] : 189 (R)

THREE-YEAR SAVINGS (S millions): NQ

FUNCTION/CATEGORY: Materiel

PROBLEM CLASSIFICATION: Quality

.BACKGROUND:,

DOD precribes decision points for major weapons systems

acquisitions which.require approval of the system based on

preliminaryJconcePts, cost estimates, schedUles, objectives, and

affordability estimates. Independent cost analyses by the

services must be prepared by organizations in each service

separate from the control and direction-of the program office

responsible' for acquisition of the system. Despite the various

independent estimates and reviews of program costs, DOD hasbeen

continually facedewith significant cost overruns on weapons

systems acquisitions.

INFORMATION GAP,PROBLEM/CAUSE/CONSEQUENCE:

The record-keepihg system that tracks the cost process of

individual major weapOhs system programs is inaccurate and often

incomplete. Cost data is not 'standardized accordirig to base year

dollars, current year dollars, and future year inflated dollars.

Additionally, incorrect data on cost changes are captured,

reflecting effects rather than causes.-,

Poor cost performance in relation" to estimates can be tied

to both DOD and DOD contractors. There is insufficient financial

incentive to industry to design lower-cost weapons syStems.

Contractors are given incentives to maximize quality and minimize

lead time, rather than to reduce Costs.

As a result, DOD has been faced with significant cost

overrruns on weapons systems acquisitions. In June of 1982,

there were 39 programs thatPwere identified as having cost

estimating errors amounting to $10.8 billion, or about 9 percent

of the original estimated costs.

50

223
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Office of the Secretary of Defense

ISSUE No./TITLE: OSD 23: Instability in the Weapons Acquisition

Process

`bEPARTMENT/PROGRAM: DOD

PAGE REFERENCE [REPORT 1R)/APPENDIX (A)j: 198 (R)

.THREE -YEAR SAVINGS ($ millions): $7,181.7 (S)

FUNCTION /CATEGORY: Materiel

PROBLEM CLASSZFICATION: Quality

BACKGROUND:

*Program instability is defined as any event; except

inflation, which causes actual program costs to exceed original

estimated costs. DOD's weapons acquisition process is marked by

severe program instability - which leads to excess costs incurred

in the production phase of weapons systems acquisition.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

DOD has difficulty relating financial affordability to the

production of proposed new systems sufficiently earl its thih.

decision-making process. As a result, more systeirre pueltnto

prodUction than can be funded in economical produc ion quantities

during the product cycle of each system, leading to cost growth

for reasons such as Atreohed production schedules and quantity

changes.

The upshot of all of this is that the process of weapons

system selection, internal DOD budgeting for production, and

Congressional appropriations are insufficiently interrelated so

that an orderly and economical process of weapons system

acquisition management may operate.

51

224 .
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Office Of the Secretary of Defense

ISSUE No./TITLE: OSD 39: Government Furnished Material

DEPARTMENT/PROGRAM: DOD

PAGE REFERENCE [REPORT (R)/APPENDIX (A)]: 327 (R)

THREE-YEAR SAVINGS-($ millions): $132.4 (S) (I: Info all)

FUNCTION/CATEGORY: Materiel

PROBLEM CLASSIFICATION: Structure

BACKGROUND:

Jks'a general policy, contractors are responsible for

furnishing all material required for the performance of

Goverriment contracts. 'DOD, however, furnishes materials as. an exception to ehe general policy where opportunities for economy

exist or when there is a need to expedite contract performance..'

A rough OSD'estimate conservatively places the amount of GSM

.provided to contractbrs at approximately $1 billion each year.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

46

DOD does not...have information on he amount of GSM provided

to contractors. There is no information system in place to

record a contract, requisition, and shipment status history file

that would serve as an auditable record of GSM transactions.

There are no records maintained necessary for status reports on

the number and dollar value of requisitions filed for materials

and long supply. Contract administration officers do not receive

a status report on .,shipments of GSM to contractors.

Limited information and controls exist primarily because GSM

is regarded as an exception to general policy rather than a

program of its own. Basic accounting and control weaknesses are

compounded by a lack of specific responsiblity and accountability

fofitthe GSM program as it is processed across disparate

maintenance, supply, procurement,'and contract administration

functions.

. As a result, there is a history. of GSM misuse and excess

requisitions by contractors.-

52 225

I

. ; s. -
PPSSCC ISSUgSUMMARY: INFORMATION GAP

(eP

TASK FORCE REPORT: DepartMent of Education

ISSUE' No./TITLE: ED 2: Management Information Systems and

Internal Controls

DEPARTMENT, PROGRAM: -Office of'FiMancial,Management

PAGE RE7ERENCE [REPORT (R)/APPENDPC (A)I: 32 (R)

THREE-1IEAR SAVINGS ($ millions): $763.5 (S) (I: Info all)

FUNCTION/CATEGORY: Financial

PROBLEM CLASSIFICATION: Quality-,

BACKGROUND:

In additi6n to its educational oversight role, the

Department of Eduation is responsible for distributing Fedenal

funds for a variety of Congressionally mandated educational

'programs. The amount of these funds was $14.5.billion in, FY 1982

making the Department a financitl institution of substantial

proportions. The Office of Financial Management (OFM), reporting

to, the Comptroller, is responsible for establishing,' maintaining,

and reporting financial dnformation relating toll funds

disbursed by the department. There are 3 major automated systems

involved in the processing of the Department's financial data.

One is a general ledger system, the other an input and inquiry

system, and one for disbursing payments.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

The current information system is unable to structure

financial data in a manner that is useful for internal

managements purposes and-which can be used to monitor program

activity. Specific problems include:

o The general ledger is being used primarily to record

disbursement data, rather than in its usual function as

a control of assets and libilities.

o Disbursement data is not always in agreement or

comparable with that reported to Treasury.

[CONT'D ON NEXT PAGE].

53

226
INFORMATION GAP (ED 2 CQNT'D)

o Input errors are numerous.

Re'conciliations of financial system accounts to

Treasury records are not done on a'regular basis.

o Mdnual systems.4ere being maintained for tracking all

direct payments in about two-thirds of the letter of

credit draw-downs.

o There is insufficient emphasis on internal controls

with no checking on the accuracy .ofpayments.

These problems are a result of a number of factors. "First,

p riority has gone-to prompt delivery of appropriated funds.

While some effort is made to assure the accuracy of payments at the time they are made, heavy reliance is placed on hindsight

reviews which occur well after the funds have been delivered

making collection of difallowances difficult. Secondly,

responsibility for internal controls is not clearly defined.

Third, coverage by the Office of Inspector General in program

review staffs is inadequate largely because'of staff shortages.

Finally, the qualifications and training of personnel.

responsibilities for key aspects of the internal control systems

are not adequate in most cases.

As a result, the inadequate internal controls coupled with

existing financialsyStems defidiencies have resulted in many

Cases of waste, fraud, abuse, and, error being d cumented in the

audit reports of the GAO, the Office of the Insibctor General and

program review staffs. Millions of dollars have been' identified

as being unaccounted for and the pattern is such tFat many more

millions are likely to have escaped dentification:
a

PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Department Of Educatiom.

ISSUE No./TITLE: ED Student Loan Delinquencies and

Defaults

DEPARTMENt/PROGRAM::.Office of Student Financial Aid

PAGE REFERENCE [REPORT (RMAPPENDIX (A)]: 40

THREE-YEAR SAVINGS ($ millions): 5495.4 (S) Info plus)

FUNCTION /CATEGORY: Financial

PROBLEM CLASSIFICATION: ADP

BACKGROUND:

Student loans outstanding at the end of FY 1982 totalled

approximately $25'billien all'guaranteed by the Federal

government. The default rate for the programs making up the

ntwest $20 billion is approximately 9 percent and about 16

percent on the'remaining oldest $5 billion. Loans already

matured and in default totalled' $2.2 billion. Responsibility for

dealing with student loan delinquency is assigned to the. Office

of Student Financial Aid (OSFA). Collection operaiions are

handled by 300 employees nationwide under the direction and . control of regional administrators. Their efforts are

supplemented by commercial collection agencies working under

contract.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

OSFA suffers from a number of information problems: lack of

comprehensive information, lack of accurate information, and

inadequate manipulation and presentation of the data' in reports

that are generated for management. Specifically, the problems

elude:

Statistical information onloan defaults is inconsistent and difficult to obtain. The imprecisidn of

numbers relating to delinquency rates, number of loans

in default, and the aging of defaulted loans is

limited.

[CONT'D ON NEXT PAGE]

55

228
INFORMATION GAP (ED 3-CONT'O)

o The information obtained at the time of Ihe loan

application is old and very much out of date when

repaymenti.end collections begin.

o Automated data processing, support is provided by two

different'computer systems, neither ofwhich is

state-of-the-art., The data used by these dattif

processing systems is far from complete beca se of the

difficulties experienced in obtaining current and

reliable information from the institutions making the

loans.

o A .viriety of reports are generated for specific

purposes but they are confusing and difficult to

interpret. No reports are produc which measure and

track delinquency at the institu nal level before

defaults are assigned to the de ment for collection.

The.lack of incentives, insufficient training, and

inadequate procedures at the educational institution level

contribute to delinquencies in the early stages of payback. The

Federa, guarantee significantly redUces the incentive to collect,

at th lending institution level where the effort is most

eff ctive. Collection expertise and experience in the department

are lacking at the level responsible fot direction of the

personnel engaged in loan collection work.

As a result of the lack of suitable information upon which

to base judgements, the ability to manage and control the

department's existing and potential debt js obstructed.

229

56
PPSSCC .ISSUE SUMMARY:

t

NATION GAP:

TASK FORCE REPORT: Deptmeni4ofEducation

ISSUE No./TITLE: ED 4: Contracts and. Discretionary Grants

DEPARTMENT/PROGRAM: Department of Education

PAGE REFERENCE [REPORT (R)/APPENDIX (A)): 46 (R)

THREE-YEAR SAVINGS ($_ millions): $207.6 (Se

FUNCTION/CATEGORY: Financial

PROBLEM CLASSIFICATION:

BACKGROUND:

Analysis

Weaknesses in accounting and control systems make it

impossible for the Department of Educatiom toclose its books,

collect 9n delinquent accounts or remit accurate payments.'

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

With $750 million.in annual outlays for contracts and

discretionary-grants in FY 1983, the Department of Education has

been unable to close -80,000 accounts since 1973 woit.h $584

million,.a sizable portion. of which could be money owed to the

government.

.4

57

230

I

4
3 $UMMARY: INFORMATION GAP

3 TASK FORCE REPORT: Department of Energy (DOE)/Federal.

Energy Regulatory Commission/Nuclear

Regulatory Commission

ISSUE No./TrTLE: ENERGY 8: *counting Financial Data

Systems - Multiple Accounting Systems

DEPARTMENT/PROGRAM: Department-wide

-PAGE REFERENCE riAORT. (R)/APPENDIX (Ale: 75 (R)

EE-YEAR'SAVIN6S ($ millions): $11.5 S)

TION/CATEGORY: Financial

PROBLEM CLASSiFICATION: ADP

BACKGROUND:

like FY 1983 'budget for DOE programs is $15.7 billion

with staffing comprised of pproximately 16,000 full-time

Government .employees and er 100,000 contractor employees.

Finari l; reporting sys ms within DOE now represent the

loose xi* ger.of those used by various predecessor agencies.

CurrentlyvIt&re is considerable local autonomy.

INFORMATION GAP PROBLEM /CAUSE /CONSEQUENCE

Xl'OffAL4111 of the Controller consolidates financial

-rePcir ',for 60t using data glihn4rated by _the detailed

activities independently tarried out at the various (17 DOE

and 56 contractor) operating locations: The overall system

is not standardized and each of the systems was not designed

to

to. meet present, needs. They often employ manual operations

; to prodisce their information. As a result, there are

[CONT'D ON NEXT PAGE]

; 58

231. ,
INFORMATL.ON- GAP (;EN8FIGY 8 CON'i'D).

inconsistencies from

both fixed' asset and

'timely nor accurate.

unreliable.

site to,pite. Data on inventories of

non-fixed a'sset property are neither

Vedardp are often. inaccessible or

1 This situation is due' to the 'current organization and

lines of control. Although the'Controller responsible.

for. the development of-.finacial'polid.Y in overall

departmental financial reporting,. he does notThave the

authority to 4nsure:that'tne pdlicies are implemented

becapsA field peoplereport.through the. lines to' their

program management.

As :a-result,: DOF. -is :unable-to handle specialrequets

for inrfOrmatiOn or'make uniform information changes. For

,example, DOE is weak in-responding to speCial requests such

as explaining unligUidated obligations or,breaking down

expenditures elow the appropriation leOel. In general, DOE

is-hampered in managing agency operations since it must '.hake

decisions on the basis of often incomplete, outdated, and . inaccurate finanCial reports.
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE. REPORT: Environmental. Priection Agency/Sthall

Business AdmiMist ation/Federal Ethergency

Management' Agency.

ISSUE No-./TITLE: EPA 10: Personnel Management

DEPARTMENT/PROGRAM: EPA

PAGE REFERENCE CREPORT(R)/APPENDI4( (A)]: 56 (R)

THREE-YEAR SAVINGS ($ millions): $6.2 (S) (III: Info plus)

FUNCTION /CATEGORY: Personnel

PROBLEM CLASSIFICATION Structure:

BACKGROUND:

EPA operates three personnel-programs designed to train,

motivate, and reward employees: in zflort, to further their

careers and the'goals of the agency. . The programs are in management training and development, individual development planning,

and performance managemenit. EPA's training costs are Comparable

to the _costs of training for the Federal Government as a whole.

EPA spends $2 million or $157 per year per employee. The present

prograth is unevenly adthinistered, lacks clear policy direction,

effective checks and balances, and ranked prioritieS.

INFORMATION GAP PROBLEM /CAUSE /CONSEQUENCE::

The EPA training program is plagued by inadequate xeporting,

'record keeping, and almost non-existent benefit analysis. As aresult, management does not keep track of expenditures or:analyze

training activities.

The program omits spedific development objeCtives,and.there

is no practice of disapproving individual training and develop -

ment experiences. More than 80 percent of.EPA employees have

been rated "outstanding ". or "exceeding expectations." Only 0:7

percent were rated less than satisfactory. The standards are

broad enough for everyone to meet them..

As a result of the lack of management controls, over 50

percent of employees initiate most 'ofiheit own training, twothirds of which is not directed toward improving-presentjob

CONT'D. ON NEXT PAGE]

60 r.

233
INFORMATION GAP (EPA 10 CONT'D)

perfOtmance Ihe,informtion is not 'integrated into proper y

appraisal of' personnel or termination of unsatisfactory per- formerS.

a

.4
PPSSCC 'ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Environmental Protection Agency/Small

Business -Administ'ration/Federal Emergency

Management Agency

ISSUE No. /TITLE: EPA 12: Financial Systems

DEPARTMENT/PROeRAM: EPA

t)AGE REFERENCE.[REPORT (R)/APPENDIX (A)1: .66 (R)

THREE-YEAR SAVINGS ($ millions): $3.9 (S) (I: Info all)

FUNCTION/CATEGORY: Financial

PROBLEM CLASSIFICATION: ADP

BACKGROUND:

EPA'g FY 1983 operating budget is expected to -remain at its

FY 1982 level of $3.5 'Financial control of the agency

is divided between the Comptroller's office, which serves a

coordinating function in the budgeting and planning process,. and

the.financial management division of he Office of Administration, which. maintains administrate control of the agency's

funds. Approximately'300 employees ,?,re involved, to varying

degrees, in BPA's 'budget process and tinantial management system.

fNFORMATION GAP.PROBLEM/CAUSE/CONSEQUENCE:

EPA lacks an actuiate and timely cost and financial information systeM needed for efficient and effective cost control. The

current financial'management system (FMS) is overly complex and

many EPA employees dp not understand the budget process, terminology, and procedures. As a result, software capabilities of FMS

are underutilized. This underutiltzation makes it impossible. to.

deliver FMS reports that are accurate, timely, and in an easily.

understoodformatt Additionally, there is no comprehensive cost

accounting system..

The level of-budget operatingcontrol is perceived by many

managers as restrictive to efficient financial management. The

employees are not sufficiently trained, and the FMS has not been,

fully implemented,to handle 'receivables payables, property

accounting, and other functions. Furthermore,'there is a lack of

senior managementdedication to'the system's integrity. . [CONT'D ON NEXT PAGE]

62

235
, INFORMATIbN GAP (EPA 12 CONT'D)

As a result, there are a number of redundant program analy -.

sis positions in the Comptroller's"office and program offices'.

The agency receivables are at an unacceptably high rate. The

Management is not well informed and the information is:hot

provided to make cost effective decisions.

L.. O

236

glf
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Environmental Protection

Agency/Smal BusineSs

Administration/Federal Emergency

Management Agency

ISSUE No./TITLE: SBA 2: Improvements in roan Quality

DEPARTMENT/PROGRAM: SBA

PAGE REFERENCE [REPORT (R)7APPENDIX (A)): 17 ..(R)

THREE-YEAR SAVINGS ($ millions): NQ.

FUNCTION/CATEGORY: Financial

PROBLEM CLASSIFICATIOMi Structure

BACKGROUND:

One principle SBA activity is making direct and guaranteed

loans to small businesses that are unable to obtain credit else

where. The SBA provides direct loans and guarantees on loans

made primarily by, banks. The FY 1983 budget is $85 million 10-r

direct loans and $2.01 billion for-guara-mteed loans. As of May

1982, approximately 25 percent of the SBA total loan portfolio

was in deferral, past due, or liquidation status. SBA's net

-charge-off percentages have been on average four times higher

than those experienced by the private, sector.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

SBA lending officers do not receive timely data.on past due

"Thirty day'and over" past.due lists are 'received 'five to

six weeks After-the fact. In addition, net charge-offs as well as

past due statistics are not provided to district office managers

on a timely basis,.

There is currently no incentive to improve the quality or

"the flowof information within the organization primarily

is no offIceficer, accouptability.

As a result of the delay and the quality of information

provided to management the ultimate collectability of many past

dUe loans is diMinished.
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE,REPORT: Environmental Protection

Agency/Small Business.

Administration /Federal Emergency

Management Agency

ISSUE No./TITLE: FEMA 1: National Flood Insurance Program

DEPARTMENT /PROGRAM: NFIP

'PAGE REFERENCE [REPORT (R)/APPENDIX (A)]: 4 (R)

THREE-YEAR SAVINGS ($ $662.0 (S) (III: Info plus)

FUNCTION /CATEGORY: Program

PROBLEM CLASSIFICATION: Quality

BACKGROUND:

The purpose of the NFIP is to provide adequate inderilnifiCation for loss of. property'in flood -prone areas where private

insurance protection is unavailable or unaffordable and to insure

that adequate Safeguards and land use restrictions are'in place

to minimize future losses. The NFIP is financed by premium

income' augmented by'Treasury borrowing. 4The budget and related

appropriations tor FY 1983 were $42 million and reflect only are

administrative costs for the current year apdAkrogrdiii-deficit

7-- incgrred_two-yearS-prkkirously"-

INFORMATIONtGAP.PpOBLEM/CAUSE/CONSEQUENCE:

There is very'limited NFIP statistical- data and what exlts

is further complicated by significa-nt program chang Th

result is a lack of a sound historiCal base which does 1,ut ermit

the identification of cause and effect relationships and is too

limited to -project the future with any degree of confidence.

This program has developed from zero to about two million

policies in the past twelve years. This initial rapid growth kn

a new program does not provide the type of historical,

statistical exper ..ence on which projections of the future may be

based. Assumptions have little credibility. No surveys or

studies have been done to provide the essential data upon which

to make decisions regarding the type and degree-of program

modifications necessary to accomplish the desired objectives.

As a result, the NFIP is not wellequipped for planning to

achieve actuarial soundness and self-supporting status.

65 238
P,PSSCC ISSUE SUMMARY:' INFORMATION GAP

*' TASK FORCE REPORT: Federal Construction Management

ti ISSUE No./TITLE: CONST 21: 'Improve Construction Project an

Program Management

DEPARTMENT /PROGRAM: Government-wide

PAGE REFERENCE [REPORT (R)/APPENDIX (A)1: 137 (A)

THREE-YEAR SAVINGS ($ millions): $286.5 (S) (III: Info plus)

FUNCTIGN/CATEGORY: Facilities

PROBLEM CLASSIFICATION: Structure

BACKGROUND:

The Government engages in virtually every type of construction project, involving buildings and non-buildings. Currently,

26 agencies possess program authority to initiate construction.

Federal obligations for FY 1983 totaled.$25.2 billion. Private

sector engineering and construction firms traditionally appoint a.

project manager for every major project or group of smaller projects. Federal agencies typically do not appoint project

'managers.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

Current management'information systems concentrate on finan-

'

4 cial data rather than the physical status of construction and

related activities:, formal detailed schedules pertaining to

construction activities often are not prepared or maintained.

There is a failure to acquire complete site data and to develop,

review and coordinate the specifications'and associated data on

which,construction prices and schedules will be based.

This is largely due to the fact that there is no single

individual who has the role of planning, organizing, staffing,

A directing,, controlling and leading each Government construction

project. Such a manager would ensure that projects properly

interface with program management.

As a result, there are scope, quality, cost and delay problems surrounding Federal construction efforts. The large cost

and schedule overruns currently experienced result in excessive

and unanticipated expenditures.

66

239
t, PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Federalq Construction Management

ISSUE No./TITLE: CONST 23: Impro,.;e Data. Based and Enforce LifeCycle Costing Requirements

DEPARTMENT/PROGRAM: Government-wide, especially, GSA'

PAGE REFERENCE [REPORT (R)/APPENDIX (A)]: 156 (R)

THREE-YEAR 'SAVINGS ($ millions): NQ

FUNCTION/CATEGORY: Facilities

PROBLEM CLASSIFICATION: Identification

BACKGROUND:

Liie-cycle costing (LCC) is a method of analyzing facility

and business systems', equipment and materials, that takes into

consideration fixed costs, operating and maintenance costs, life

expectancy residual values, and the cost of money. It is a

recognized and established technique for estimating the toldl

costs to 'acquire, own, operate and maintain buildings, and it

aids in selecting among alternatives that have distinct variations in cost over time., the concept .of LCC used by the edet

-!Ekecutive Branch is comparable to that d in the private

sector.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

The General Services Administration bases budget i=equests on

very crude estimates, usually based,upon regional unit -cost per

square foot or some other gross measure based on historical . experience. Such gross measures 'introduce inaccuracies which are

further compounded by relying on data that reflect private sector

data!rather than Goyernment exPerience.. The cost,of land is

seldom precisely known, due to lack of preliminary appraisals.

This is due to Government failure to enforce LCC requirements and insufficiegt data and confusion about discount rates in,

some cases.

A

As a result, while LCC is prescribed for most major Federal'

construction programs in one form or another, the method is not

employed consistently or accurately by all agencies, and thus its

effectiveness is hampered. Consequently, selections'based on

alternative investments may be made on an'insufficient basis and

may ultimately be made in error.

67 240
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Federal Feeding

"iSSUE No./TITLE: FilitOfNG 1: Policy sn.i Mar

Imfotmation for Federal Feeding

DEPARTMENT /PROGRAM: Government -wide J

PAGE REFERENCE [REPORT (R)/APPENDIX (A)]: 5 (R)

THREE -YEAR SAVINGS ($ millions): NQ

..\ FUNCTION/CATEGORY: Support Services

PROBLEM CLASSIFICATION: IdentifiC/Okon

BACKGROUND:

Federal efic.omp set.;-y 0_,fterent types of,

institutional and military feeding activities. Currently,

Federal ff_.-ding includes such diverse operations as school

breakfast and lunch programs, Department of Defense procurement,

for troop feeding, military. commissaries and .clubs,.dietary

services for patients of Veteran's Administration hospitals,

Bureau' of Prisons Inmate-Run Farms, and cafeterias in

Federally-owned buildings. Because of its many - diverse'

dperations and complexity, no'comprehensive record of Federal

feeding has been written or documented and no singular Federal

policy exists. The Task Force.estipatedthAt the sum of allFederal feeding operations approximates $27 billion in

eXpenditures in over 100,000 indivildual locations.

;INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCEe

There is a lack-of management information systems as well as

budgeting and cost accounting systems for detailing Federal

feeding functions. Where they exist, 'Cost data gegeralli_exclude

many elgments of the total cqst of feeding operations. Across

agencies and departments there is no consistent set of dollar

figures associated with Federal feeding operations. Due to the

ladk of adequate. management information and reporting

requirements, the size 'and.scope of. Federal feeding is not known

by government officials., This void exists at the agency. level as

well as at any centralized level. Frequently, recorded total

costs are not

[CONT D ON NEXT .PAGE]

, it 41
INFORMATION GAP (FEEDING 1 CONT'D)

broken down into their component costs (i.e., raw food, labor,

transportation, utilities, etc.). Local manageri usually cannot

Provide information regarding the -cost of space, equipment

depreciation, maintenance, utilities, or administrative expense.

Attempts,to collect aggregate feeding data at the agency and

departmental levels have proven to be a difficult task. For

,example, the Bureau of Indian Affairs administers appropriatiOns

for school food service included In the instructional allotments

Provided to each Federal or contract school under the Indian

education programs. BIA was recording in their accounting system

food service under the headi'ng of "Gravel Roads and Construction"

making an accurate assessMent of food costs quite difficult.

The lack of information is attributed to the fact that no

single, comprehensive Federal. feeding policy exists. This la6k

of policy has created, a universe of feeding operations that'is

fragmented and lacks uniformity of implementation. Further,

feeding generally plays a secondary role in the operations 'of

Federal agencies and departments. Where feeding is not a primary,

mission it usually does not receive the Management attention

necessary for efficient operation.

The lack of comprehens/ve policy, inadequate managemlent

information systems and de th of Management attention

contributes to a situation of little management control over

Fe, ral feeding. As a result, the food service,ptograms.are not

b ng monitored, funds are not being efficiently allocated, and . funds are often being duplicated or misdirected.

69 242
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Federal Feeding

ISSUE No./TITLE: OEEDING,5.: Troop Feeding Services 1 DEPARTMENT/PROGRAM: gepartment of Defense (D62) 1

PAGE REFERENCE [REPORT (R)/APPENDIX (A)]: 60 (R)

THREE-YEAR SAVING$ millions): $167.3 (S) (III: Info plus)

FUNCTION/CATEGORY:. Support Services

PROBLEM CLASSIFICATION: Quality.

BACKGROUND: WO .DOD procures food through the Defense Personnel Support'

Center (DPSC). 'DOSC.is headquarteied in Philadelphia,-

Pennsylvania, and has offices throughout the world. Although

DPSC purchases food primarily for DOD,'and primarily'for, trooR

feeding, DPSC also procures food for other government agencies

and private parties. In FY 1982, DPSC purchased $1.391'.billion

of food. Purchases for the Army constitute nearly 44 percent of

total purchases., DOD-wide,purchases constitute 98.1 percent of

. the total and other agencies 1.9 percent of total food purchases.

There is no DOD information sysEem to record all costs and 'food

service part4cipation rates. Different branches of DOD disagree

on the amount of depaitment's food eXpenditures. DOD,also lacks

systematic computerizecLdata'on labor, transportation, and

Overhead costs 'Associated with feeding 'operations. The method

for determining the budget for military subsisEence,has -remained.

unchinged"for over 50 years. The system utilizes a

Food Cost Index (FCI) which is calculated based on higher-cost

food items than those actually consumed in dining facilities.

Consequently, the military's food_ budget is inflated.

The problems seem to have resulted frOm an antiquated

manage nt system and lack of incentive to change.

As a result, the military gets more money than is necessary

to feed troops. Excessive food allOwances encourage lax

accountability. The GAO has'found that.food is not always

consumed as reported and often food is being wasted.

70

24,3
Sc ISSUE SUMMARY: INF0RMATION GAR_

4 4

TASK FORCE REPORT: Federal Hospital Management

ISSUE No. /TITLE:, HOSP 3: A,Central Health Entity for the

Department of. Defense

DEPARTMENT/PROGRAM: DOD

4 PAGE REFERENCE [REPORT (R) /APPENDIX (A)]: 64 (R)

THREE-YEAR SAVINGS ($ millions): $744.7 (S) (III: Info plus)

FUNCTION/CATEGORY:' Financial

PROBLEM CLASSIFICATION: -Quality

BACKGROUND:

Currently, three Military Medical Departments'administe:' the

Military Health,Care System (MRCS), operating 161 hospitals, 310

clinics and various other programs at a cost of $6.7 billion in

FY 1981.

N

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

The Uniform Chart of Accounts JUCA), on whiCh MHCS's

accounting system is based, omits many costs that would depict

work load, and cost. data as well as omitting costs that would .be

allocated in the private' sector. Examples of major. cost factors

omitted are coOstructiOn and ren0Vating,costs, employee benefit'a4

overhead, training centers, and interest expense, among others. :Is

This is due to the fact that the development of UCA has beeh

hampered by a lack of central control and by varying degrees of

support for each Medical Department. There has been a general

lack of an adequate information, system as well.aa a lack of

controlling overall authority.ba.,sed upon a consistent mission

philosophy.

As a result., the management infoi-mation system currently

being developed is extremely limited, due to the lack of data

available from each of the services. This inhibits program

monitoring and plahning', and haaNfesulted in excessive costs of

-

J .running certain programs. .

71

N..1* 24.4

I t.1 1.0
. , PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Federal Hospital Management

ISSUE No. /TITLE: HOSP-4: Planning and Resource Allocation in

the'Veteran's Administration Hospital System

DEPARTMENT/PROGRAM: Vet'eran*.A0ministration (Depi,rtMent of

Medicine and Surgery)

PAGp, REFERENCE [REPORT (R)/APPENDIX 1A)11: 82 (R)

THREE-YEAR SAVINGS ($ million's): $4,887.6 (S) (ILI: Into 'Ads)

FUNCTION/CATEGORY: Financial

PROBLEM CLASSIFICATION: Quality

BACKGROUND:

The Neterans Administration (VA) administers/172 hcspita

Which provide a full range of services to patienp's. .In-pati

care is budgeted at $4.8 billion for FY 1983.2 Tile .total bud9 t

has increased from $1.7'.,billion in 1970 to overliY billion in FY

19p3,..Rowever,these facilities are underutilized in the

aggrgate.,''Over the past.15 yegrsi:'t.he utiliiation of,VA

hospitals by eligible veterans, and the characteristics of the

veteran "population, haVe'each shown some dram§tic trends that are

hot 'reflected' in the operating statistics, which are at variance.

''fromr.thOsefound in the private health care system.

INFORMATION GAP PROBLEM/CApSE/CONSEQftpCE:

VA's patient treatment file (FTF) lacks key information on

attending physicians,.the details of the. patient's condition,

'length of stay and reasons for hospitalization. Such information

may be missing orill-decined,,and it is not accessible once

stored.

This is' due-to the number of Staff who are responsible for

each patient's- treatment file, and:overall lack of managerial

checks to see that diagnoses and procedures are properly

abstracted and coded.

As'a result, the VA lacks a sophisticated PTF. This affects

the VA's ability. to adopt a case-mix-based processbygeting or planningc-

., 4

72

24 5.
PPSSCC ISSUE SUMMARY: INFORMATION GAP

,iPOt if00Ct RvP08T rFederal Hospital Management'

'..HOSP 5: :: The Veterans. AdrilinistratiOn Health

'Facilities Construction t.rogram.

. , VA Office of Conttruction - . /WVA5FggPLatEPORT (Rf /APPENDIX .(A)-ir 105

Tlilt0Alft 'RAVINGS (S milliont): 7. S73.3.3 M (III: Info plus ) Alt

PtifiCyTON/QATEGORY: Facilities

PROtir,lki CLASSIFICATION: Identification

4 Ihe Veterans Admin. tration (VMdevotes, nearly 800 staff

Allheron%,to managing the A- Construction program. Over Sl.

1:)illioll -has been authori ed by Congress for the constructi

.111rPW:9111 sine 1974._-There is S452 million auihorized for F

498) , Thy; irokume af construction act i v i ty. neegs to keep pace

./tvit1)101yoletcence and. changi g neerls of the Veteran population

tt. require billi r of dollars.

-. /14r012MkTI0N GAP PROBLEM/CAUSE/CONSEQUENCE:

121ca and assumptions Used for ,construction planning are .

cl ,aervites, geographic movements .of. the. vet. ion, ueUclialable. Information on the %/A 's share of

PoP4aatatket for

medical

tocilitf utilization trends, and technological change are all.

Outlaterl. or lacking,,

These shortcomings are thobght to be due to the bureaucratic

liptona oetwean the Office of ConStruCtion and the Department. of,

Vieihe and surgery. and the leadership of the .Office _which

are

%.#a610(1 to current practice and resistant to change. °There hre no

iec%OtimS - for 'cost efficient performance: no reviews and no

Ov1A01s.

At result, major planning decisions are made on ihsuffi-'

intormaEion, and tie construction program.,,sutho.rizes Pro,

l'actO th4.t are potentially .Wasteful.
PPSSCCiISSUE SOMMARY: INFORMATION CAP

TASK FORCE REPORT: 'Federal Hospital. Management

_ISSUE No./TITLE:: HOSP 6: Organization and 1Decision Making in

, Q 1 Vearans Administragion-Hospi,tal SyStem

40b

DEPARTMENT /PROGRAM: Veterans Administratioiv(Department of

Medicine and Surgery)

PAGE REFERENCE_CREPORT (R)/APPENDIX ()]:

THREE-YEAR SAViN'GS NQ

FUNCTION/CATEGORY:` Pei.sOnnel

PROBLEM CLASSIFICATION: Identificatio611.

BACKGROUND:

124 (R)

The Chief Medical Director of the Department of Medicine and

Surgery (DM &S) reports to the Administrator of the:Veterans

Administration..(VA) and is in charge of all prograMS and over-.

sight of hospital funt.tions. There are 29 districts and six

major 'regions tha.t are minagedby- the Centre/ Office. Large,

priyatesector hos0i Systems-focui on the. ecentralization of

resbOnsibilty.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:.

There is A laCk of information pertaining to facilities'

work load, individual institutiOnabudgets, case- mixes, and

other: data. SUch'',data is necessISry.to aid the VA. in planning on a

national basis.. ,s

, .PThiS is due to minimal control oyer data collection effortS4.

a Ivor understanding-of the information needs of.thfliVA system,

and the'apparent lack of budgetary incentives to ma KZ changes.

As a result, management and account bllity at each VA facil-;

ity'is limited. There is little valid basis on Which to evaluate

pertormance,po feedback-or.reward system, and:thus no incentive'

to improve p4rformanCe.

S
PPSSCC ,ISSUE SUMMARY:- INFORMATION AP

TASK FORCE REPORT:: Federal Hospital Manag

ISSUE No-./TITLE: -HOSP 7: The Management InfOima

the Vgterans Administration Hospi

. DEPARTMENT/PROGRAM: VA (DM&S, Controllerr-Data Management,

HospitalS) . PAGE REFERENCE (REPORT (R }/"APPENDIX (A) ] : '135 (R)

THREE-YEAR-SAVINGSAA millions):' ($365.5) (S).

FUNCTION/CATEGORY: Materiel

-PROBLEM CLASSIFICATION: Quality.

HP BACKGiOUND:

The Neterans Admjnistration(VA) Automated Data Processing

(ADP) is outmoded and.managed remotely. Infoematiom.

systemt sup orting. VA hospitals .are applied uniformly.to all

hospitals apd operate in a batch.mode at a single central

facility.) -"For each major system there is a'project manager:

1ocated im the Central.Office in Washington, D.C.. /Therefore,

communication between the manager and individuals supervised is

on a remote basis. The management and charaCteriStics of informaticin syttems used by private,multi-hotpital management organizatfOns is far more sophistiCated and seiviceable, -

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

.The major sources of VA data have problems whith limit their

usefulness:

o. Data is aggregated before it is input.A4

o There is no flexible report-generation capability.

o Identification on the Patient Treatment File is

lacking.

Budget and monitoring information lacks conSistency,-

and .accuracy, and such information cannot be interfaced

with that on other systems.

o There is no source of data foe measuring performance at

a level below the aggregate.

(CONTINUED ON FOLLOWING PAGE):

Capit and development costs 'associated with a neqADP

system. FUture savinge?'are substantial, as other operating

improvements are contingent upon the use of"a sophisticated

ADP system.
PPSSCC ISSUE SUMMARY:. INFORMATION GAP (CONT'D)

In. addition, there are long delays. in receiving 'data at individual hospitals and Many facilities don't utilize ADP systems:

Ttiis situation has developed. over the past two decades

because the, VA hasneverreally been compelled. to "manage.," but,

has merely had to store data to meet work load =and fiscal goals.

As a result of these characteristics, the existing VA infor=

mation system. has little value for management: All users face

duplicate and erronemrs data, slow prodessing,-nonintegrated

systems, and slow reporting. Users in individual facilities are

accumulating much data of little use at the local aevel; ,they

alip lack control over developing systems. The current system

does not provide the information needed for effective institutional management.
-PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Federal Hospital Management

ISSUE No.-/TITLE:' HOSP 9: Reducing the Amount of Federal Hospital Cost Spent on the Open Market for Medical

Supplies

DEPARTMENT /PROGRAM: Veterans Administration, DePahment

Defense,. Indian Health Service

PAGE. REFERENCE (REPORT (R)/APPENDIX (A)]: 162 (R).

THREE -YEAR SAVINGS ($ millions): $221.8 (S) ( : Info all)

FUNCTION/CATEGORY: Materiel

PROBLEM CLASSIFICATION: -ADP

--BACKGROUND:

Federal hospitals acquire their medical supplies from the

. following sources: 1) Federally'operated supply depots, 2) purchase orders against nationally negotiated, indefinite quantity

contracts, 31 open-market purchases negotiated at the local level

and 4.) orders placed on the open market without negotiation.

Local level purchaising accounts for 40 percent of all purchases

representing $673.1 Milliod-in FY 1981. In contrast to VA procurement, the private sector uses national cOntraets-to putchaSe

75 to 85 percent of its medical supplies. . 1 INFORMAT GAP PROBLEM/CAUSE/CONSEQUENCE:

Neither the Veterans .Administration (VA) nor- the Department

of Defense 1DOD) has a procurement data ,system to recordYmonitor

how frequently hospitalI purchase on the open market when such

supplires could be acquired through national contracts. In

addition, little data is available to VA and DOD to reveal the

true extent of local purchasing. This is especially true. for

non-stocked items.

This is due to the fact ehat most hospitals do not even per7

fOrM manual analyses of purchasing records and that there are few

incentives to manage more efficiently.

As-a result,: VA exhibit; poor administration and financial

controls, As..1011.,as a lack of ,planning. ithoUt data it is not - possible for a sui pply-or procurement officer to monitor performance or dentifvopportunities for improved pricing.

O 77 250
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK, FORCE REPORT: Federal-Hospital Management

(1; ISSUE No./TITLA, HOSP 10: Medical Care.Cost Recovery by the

Department of Defense

DEPARTMENT/PROGRAM: Departinent of Defense (DOD)

PAGE REFERENCE1REPORT (R} /APPENDIX (A)): 172 (R)

THREE-YEAR SAVINGS ($ millions): $68.5 (R) (I: Info all)

FUNCTION/CATEGORY: Program

PROBLEM CLASSIFICATION: Quality

BACKGROUN.d.:

DOD operates the largest medical care cost recovery program

in the Government. DOD medical facilities often treat individuals Who are injured or become diseased due to the negligence on

irresponsibility of a third party. When a DOD facility provides

such care, that facility is responsible for notifying claims

officer%of possible third-party recovery.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

ClaimA..officers are hindered by a lack of information neces-

-sary,for processing claims. Often those officers are unaware of

the possibility. that third- party' liability exists. Even when

they are aware,.the facts and circumstances are often so vague

and incomplete that it is difficult to properly assess and

Collect the, liability.

Reasons for this information deficiency include :inadequate

`forms, inconsistent information-gathering procedures, lack of

time and non-response from the injured party. Medical care cost

recovery is not a high priority.

As a result, claims are not recovered and the Federal

Government (DOD) does not realize the revenues that 4 should.

78

25.E
PPSSCC ISSUE SUMMARY: INFORMATION GAP'

TASK.FORCE REPORT: Federal 'Hospital Management

ISSUE No./TITLE: HOSP 11: Medical Care Cost Recovery from

Insured Inactive Military Benefitiaries

DEPARTMENT/PROGRAM: Department -of ,Defense (pop)

PAGE REFERENCE (REPORT (R) /APPENDIX (A).]: 191 (R)

-THREE-YEAR SAVINGS($ millions): $1,211.4 (R) (I: Info all)

- FUNCTION/CATEGORY: Program

PROBLEM CLASSIFICATION: Identification

BACKGROUND:-

Manyof those individuals who are eligible for and receive

medical care as military beneficiaries alsso have priyate health

insurance. Historically, DOD has made nb attempt to collect the

cost bf care prdvided to these insured beneficiarieS from their

privatl insurance carriers. Total medical care costs for inac

tive beneficiaries exceeded $1..6 billion in FY 1981.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

The. information.neceSsary for DOD to seek recovery of costs

is not adequate.,. DOD does not have a system to sccuMulate.the

actual-cost of caring for patients on an individual basis' and

does not effectively utilize the Uniform Chart of.-Accounts which

accumulates costs in Medical facilities by cost centers, The

Military Health Care System treatment forms do not adequately

cover health insurance information. Also, cost information used

to reimburse claims is generally inaccurate.

These problems stem from DOD's past reluctance to pursue

reimbursement as well as from its lack of management controls.

As a result, claims are hot processed, and when they are -,

unjustifiably, low, charges are assessed a410, collected.

Revenues recovered from insured beneficiaries' insmrance

carriers.

de 79

252

# .
PPSSCC ISSUE SUMMARY: INFORMATION GAP

.TASK FORCE REPORT: Federal Hospital Management

ISSUE,No./TIVrE: HOSP ,12: Reducing Duplicate Payments in the

Federal Hospital System

DEPARTMENT/PROGRAM: VeteransIdMinistiation and Indian Hea th

Service

PAGE REFERENCE [REPORT (R)/APPENDIX cA)): 213 (R)

SAVINGS (S millions): $195,0 (S) (II: Info only)

FUNCTION/CATEGORY: Program

PROBLEM CLASSIFICATION: 'Structure

BACKGROUND:

When Department of Defense'ADoD), Veterans Administration

(VA) and Indian Health Service (IHS) facilities are not used by

eligible beneficiaries,.the.cost -of care of a private facility is

reimbursed to them.. The DOD, VAand-IHS reimbursement programs

are independent services with different fee systems, 'in'cluding

different eligibility standards and reimblAsement rates. Some

15-20 percent of all VA and IHS claims result in duplicate orerroneous payments.

INFORMATION GAP PROBLEM/CAUSE/eoNSEQUENCE:

. There are no procedures `to' identifyipatients witH dual-eligibility, an0 no efficient procedure for'authorization. of pay- , 'ments. ,The ndependent claims.processing systems do not exchange

compatible information. Contract health officers frequently do

not know enough about authorizatiqn procedures of other programs

and other defined reimbursement amounts.

This is.due to, the independent organizational structure of

these programs, and_lack of incentives at the program level to

initiate cooperation.

As a result, there is no control over duplicate or erroneous

payments and funds may be grossly misallocated.

go 253

r4
PPSSCC ISSUE SUMMARY: lINFORMATION-GAP

TASK FORCE REPORT: Federal Hospital Magement

' ISSUE No./TITLE: HOSP13: Medical Care Cost ReCovery Opportuni

ties in the'VA Hospital System

DEPARTMENT/PROGRAM: Veterans AdminiStration

PAGE REFERENCE (REPORT 10/APPENDIX (A)]: 224 (R)

THREE-YEAR SAVINGS ($ $1,441.2 (R) (III: Info plus)

FUNCTION/CATEGORY: Program

PROBLEM CLASSIFICATION: Quality

BACKGROUND:

Care in Veterans Administration (VA) hospitals is free for

veterans aged 65 and older and for all veterans with serviceconnected illnesses and injuries. free care As also provided to

, veterans under 65 with. non-service-Connected illnesses or

injuries if they demonstrate they are financially unable to pay

for their Care. Oier.13 percent of the veterans in the latter

. category have private health insurance and approximately 62

percent Of the veterans in VA hospitals were non - service- . 'connected.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

The VA accounting system does not reflect the real costs of

care. It does not provide an itemized billing for each patient.

Therefore, xates are based on. average costs, instead of real

o costs. Means testing was-dropiped'and actual costa are not col-

, 41. lected. ;' This is primarily because the VA does not have the information- system capable:of\providing accurate costs for services.

Although authorized by lAw, the VA has not devised'a means test

for those non-servicw-kciihnetted veterans who declare. themselves

unable to pay for.medical care services. Also., current law does

not prevent insurance carriers from having exclusionary Clauses

that bar recovery:by Government agencies.

As a result, claim's authorities do not know-when a

insurance

nonservice-connected veteran has insurance and4is capable of paying

for the costs of med*cal care provided, and they are not able to

actively pursue claims. When processing a claim, they do noN

know the actual costs that should be recovered. Using. actual

costs to produce billable charges would greatly increase= the

amount of recoverable cost,

Additional .revenues.recovered.

. 81

254
PPSSCC!ISSUE SUMMARY: INFORMATIOWGAP

TASK FORCE REPORT: Federal Management , items

ISSUE No. /TITLE: FMS 1 :. Administration 4rd Management

e: 'Functions, Methods and Organization . .DEPARTMENT/PROGRAM: Executive Branch

PAGE REFERENCE [,REPORT (R)/APPENDIX (A)): 4 (R)

THREE-YEAR SAVINGS (1 millions): NQ

FUNCTION/CATEGORY: ,Financial

PROBLEM CLASSIFICATION: Structure

BACKIOkiND:

No single department or agency is responsible for oV,erall.

Executive Branch administrative direction and policy. zetting.

Responsibilities for property, financial management, human

resources, and ADP management are scattered among many agencies.

. INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:.

Management inftAmation provided,to'the central agencies of . the. Executive Branch is incomplete. This lack of,Government-wide

- management information inhibits the ablility of central agencies

to improve Executive Branch administrative functions.

8 255
PPSSCC-ISSUE SUMMARY: INFORMATION GAP

Az--,e, TASK. FORCE REPORT: Federal Management Systdms

ISSUE No./TITLE: FMS2: Executive Branch Information SystemS.

DEPARTMENT /PROGRAM :s Executive Branch

PAGE REFERENCE [REPORT (R)/APPENDIX (A)]:

THREE-YEAR SAVINGS ($ millions): NQ

FUNCTION /CATEIORY: Financial '., PROBLEM CLASSIFICATION: ADP'

BACKGROUND:

50 (R)

The Executive Branch agencies utilize .300'different

automated accounting, systems which are incompatible with each

other. "This is despite a law requiring the qAo to establish

standard accounting siSltemS across all agencies.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

The result of the multiplicity of accounting systems is a

massive' duplication in the development of agency hardware.

one seems to knot+, the combined cost.of these different accounting

systems - it is "'estimated" that the Executive B'ranch spends over

$3 'billion annually for software.

The use of 300 different systems has contributed to a lack

of timely anddqrate management information for use /a by agency

heads.

83

2 5,6
PPSSCC ISSUE SUMMARY: INFORMATION. GAP

TASK FORCE REPORT: Federal -Management Systems

ISSUE No./TITLE: FMS 5 Capital.Budg.eting

DEPARTMENT/PROGRAM: GovernMent-Wide

PAGE REFERENCE CREPORT.(R)APPENDIX (A)p- 96 (R)

THREE -YEAR SAVINGS ($ millions): NQ

FUNCTION/CATEGORY: Financial

. PROBLEM CLASSIFICATION: Quality

BACKGROUND:

The Federal Government currently conducts no comprehensive

inventory of its capital assets and their condition.*

INFORMATION GAP PROBLEM /CAUSE /CONSEQUENCE:

, Without such ah inventory, identifying maintenance needs and

new item requirements as well as developing capital plans and

budgets is not
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Financial A'sset Management.--

. , ISSUE Ng./TITLE: ASSET 8: Cash Management Incentives - Budget -t

System, ,

.. . , : . >: qt i. . DEPARTMENT/PROGRAM3', ment-wide (Treasury Vepartmeni ) ,-z

PAGI1REFERENCE Mg APAINbix (An:

v 75 (R)

;-,4: ,-

- . THREE-YEAR SAVINGS ($ m ions): Ng.

,FUNCTION/CATEGORY: Financial

4 - - w

PROBLEM CLASSIFICATION: Structure

BACKGROUND::

Deficit financingbeenithe mode of-operation dn theGovernment for the last420 leers. In FY l983, Interest .orvthe - pdblic debt.. is estimated to be $132,.9 Otesetting.lriterest income reduces, the rat interest outlay, -to $96.4

Treasury, 'through thetkOteau of Public Debt ;and the Eedeeal . Financing'Bank, is eeipbnsible for virtuarly.all,of-the interest

expense of the Federal.Government. . INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE: illr

.

. . Agencies and departments do not -have accounting systems to

account for cash management proceises-(monitoring,receivatiles,.:

payables or inventories). Nor do they have cash flow forecasting

capabilities. Cash managementconsists of after-they .-fact. recording of data; which is used, primarily for the -next year'S-'budgiftt

allocations and for trend analysis cash flow forecasting. ,

5 The absence of cash management systems is largely attributed

to' the fact that no ncentive exists to develop .ore. The reason

for this is:thae traditidnally Treasdry has paid for all cost -of

money within the Government, whether oe not dt did Aheiactdal

disbursements. ,, As a result, billions of,d011ars in interest expense is

being unnecessarily charged.

85

258
4a.

10SSCC ISSUE SUMMARY: INFORMATION GAP,

TASK' FORCE REPORTt.P,Financial Asset Management

'.ISSSIE- /TiTLE: ASSET 9: . tash-Miiiagemenr*'Incenti.es

trat ion - . DEPARTMENT/PROGRAM:. Government-wide:.

PAGE REFERENCE rkEPORT (R) /APPENDIX (A)1:' .78 (R)

THREE -YEAR SAVINGS. IS millions): NO..

FUNCTION/CATEGORY: -Performance

.P41011LEM CLASSIFICATION:

BACKGROUND.:

Structure

01.

0 .

lections and disbursementi'OrGovernment funds total over

$1:7' rillion annually. This aMplints'to S'.4 billion collected

daily and a;like amount Spent daily. Compared to-large corporations, the average daily transaction amounts Would equal or

piCepd7ne annualasales .rid disbusements of the 119th larPest

corporation .in rho responsibility-for develbpino.'

actounting,sySteMs 0,es internally within each:derfartment or

agency,, and sometimes at tKe program level.

, r

'

1

. INFORMATION CAP PROBLEM/CAUSE/CONSEQUENCE. : CAP

. . . , ,.

. '. The information sysems..in many agencies are far behind the

"state. ,of-the -art.orare,incompatib.le.across agency linef s. The

4-. federal, Government cannot centrally determine:- : .

.

.

. .."(

o delinquency and ag,ing.of debt owed the Government with . ,,compatibld defin21 tions across agency lines, 4.....\ o cash held be grantees, .

. , o cash balances, :... ..

:o,

. real. time financial data -- value of procurements, 0

grants, obligations, commitments, and .. .. p total Federal funds Committed to indittidual states and

localities. r 0. This lack of knowledge results from the absence of a

,tralized cash'management function. There is no cen 1 iSource .of

' iIiformatipn qn accounts receivable, accounts paya and invenraryconetol systems. NC incentives exist to imp this situa -.

tYpn%::

As.aresult, there is poor management of cash resources:

:poor ttilizatiOn of available:funds and high interest expense. - ..0

86

e 259

E`
PPSSCC ISSUE SUMMARY: INFORMATION GAP

la15.t9Acf5E1291E! Financial Asset ManageMent

ASSET 12: Credit Procegsing

yk1;az MOgy/12132DIA: Government -wide

`151A5,t021110EDIEFORT (R) /APPENDIX (A)I: 103 (R)

SAVINGS ($ millions)_: $1,010.8 (S) .(I: Into all')

$5,571.2 (CA),

4

e0NeT4ON/CATEGORY: Financial

PRW,480 CLASSIFICATION: Structure

- 0Af<GIIOUND.

act ivi ties of the U.S. novernment make it

0r of tile largest banks in the world. In FY 1981, the-tot-1

omoo!)t of new direct loan transactions approached S56 billion,

e'. accumulated total of direct loans outstanding was SIRS

rO11ii00./ Twelve of'the thirteen departments and more than two

jclen aciehCieS and subdivisions are involved in direct' lending

IC has been estimated that the Federal GOiernment

Ocle over .1.3 million direct loans yin FY 1981.

INWIWTtON GAP PROBLEM/CAUSE/CONSEQUENCE:

Credit information on a Government-wide basis is not timely,

accaitate or complete. No. Gornment-wide statistics are availi7h default. There is no information haring among 'departI.Mlts oh credit worthiness. Credit definitions vary between

'(110atonents as well as within a department. No coordination, of

tQpotts is attempted and duplication ape inconsistencies within

aid rrIcIng agencies exist.

This information inadequacy results from-several factors:,

itleet)Vives to improve credit practices are inadequate, the con.

.tot of loan applications. is insufficient, in vernal controls are

and there is no emphasis on servicing the outstanding

oedit. It -Az a re5ult, the accounting and record systems are incapable

O. stipport.ing effective management. Defaults and charge -offs

O.-

87

- 250

a
PPSSCC ISSUE SUMMARY: INFQRMAT/ON,GAP

TASK4ORCE REPORT: FinanCial Asset Management

ISSUE ,N'o'./TITLE: ASSET'23: Improved Accounting, and Reporting

Guaranteed, Gbvernment Lending

DEPARTMENT/PROGRAM: Government-wide

PAGE REFERENCE [REPORT (R)/APPENDIX (A)]: 183 (R)

'THREE-YEAR SAVINGS ($ millions): NQ

FUNCTION/CATEGORY: Financial

PROBLEM CLASSIFICATION: Structure

BACKGROUND:

Guaranteed loans, like direct loans, enable the Government to achieve desired flow of capital into, specific sectors to

implement certain policy goals. New gross guaranteed loans in FY

1983 are expected to total $150.1 billion. Such guar'anteed loans have grown more tnan 122 percent in the five-year' period froM FY

1978 to 1983. Five agencies accounted for 88 percent of all new

gross guaranteed loans in' FY 1983.. There is little if any (con- sistency) among guaranteed programs with respect tc origination

in guaranteed fees, actuarial soundness, interest rates or loan origination, servicing and liquidation.

INFORMATION GAP PROBLEM CAUSE CONSEQUENCE:

The Government maintains conflic.ting information as to exactly how many loan guaranteed.programs are in operation and

the total of guartnteed loans. There is a lack of data, to adequately monitor the quality of lending agency portfolios.

Current bUdget,:reporting on guaranteed loans is limited. Although the agencies do report some information to OMB for the evaauation of these programs, they db,not provide data to

adequately monitor the costs, the quality, the level of subsidization, or the average yield of their portfolios.

' . . . Due to the accounting practices, which push;the.cbsts of Federal loan guaranteed programs into future years, there is no

4 direct incentive to agencies to reduce losses. In fact, it . creates a means by which bsses banbe hidden for ?ears witpbut

being recognized-

[CONT'D ON NEXT PAGE]

88
s. INFORMATION GAP (ASSET 23 CONT4)

As a result of these inadequacies, it is impossible to make

rational decisions'doncerning program costs and benefits. The

agecies are not held'accountable for their programs .and port:

folio problems are not detectable.

A

S.

89 262
PPSSCC ISSUE SUMMARY: INFORMATION GAP

. TASK FORCE REPORT: FinanciO4 'Asset Manag4mene

ASSET 2.6: Fedeeb.1Debt Collection-Management

-DEPARTMENT/PROGRAM: Government-wide

PAGE REFERENCE [REPORT (R)/APPENDIX (A]: 208 (R)

THREE-YEAR SAVINGS ($ millions): $1,190.6 (5) (I: Info all)

$8,100.0 (CA)

FUNCTION/CATEGORY: Financial

PROBLEM CLASSIFICATION: Structure

BACKGROUND:

Debt owed the Federal-Government arises from hundreds of

Government activities that generate-receivables. About 85

percent of the total $219 billion in receivables due the Govern- ment as of June 30, 1982 werefrom loan programs. Of that total, 16 percent are delinquent. Twenty-four agencies are primarily. involved in the debt collection process, accounting for about 95

percent of the total recorded debt owed the Government. While the Executive Branch recognizes debt collection problems, not, much real progress has been made. total'debt owed,the Federal

Government has increased 25 percent since 1978 while delinquencies have risen by 38 percent.

INFORMATION GAP PROBLEM /CAUSE /CONSEQUENCE:

.7 I many cases reliable data on receivables do not exist. There i a lack Of a uniform definition of terms used in

monitori g debt collection. These include such fundamental

conceptsVas debt, delinquent debt and allowance for doubtful

ate4eounts or write-offs. This lack of ghiformityis found across various agencies as well as within selected agehcies. In

addition, thele is a lack of uniformity in reporting' delinquent debt, and receivable records are often inadequate. Accounts receivable and loan receivable records are somewhat misleading

and often inaccurate. These problems in:reporting are compounded by the lack of'computerized account records and outdated

equipment:

[CONTN) ON NEXT PAGE]

90 263
INFORMATION GAP (ASSET 26CONT'D)

There 'currently is little or'no incentive for each agency 'to

collect debts, primarily because the monies collected go to the

TreaSury Department and d'o'not affect the agencyL.s appropriations. As a.resblt, the agencies give,.a much high6r priority to

the loan and grant programs and very little to debt collection.-

As a result of these problems, the 'effectiv documentation

and tracking of Federal delinquent debt is impeded. Delinquencies ate increasing at a much higher rate than total debts. "..,

91

264

1.,;7
-r PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Financial Asset Management

ISSUE No./TITLE: ASSET 27: Internal. Revenue Service Refund . 0.ffsgt.

DEPARTMENT/PROGRAM: internal Revenue

PAGE REFERENCE [REPORT (R)/APPENDIX (A)): 215 (R)

THREE,-YEAR SAVINGS (.$, millions):, $398.3 (S), $1',930.5 (CA)

' FUNCTION/CATEGORY: Financial

PROBLEM CLASSIFICATION: Analysis

BACKGROUND:

The Gendral Accounting Office (GAO), Office of Management

andoBUdget COMB.Y.,and-a11 Tt.heprogram-agenciehave7supported . \Collecting delinquent accounts by offsetting nontaxing debts'

against,,,Federal tax refundS% The IRS has opposed such a prOgram:

becau4e of, its potential negative effect on the taxpayer

withholdinT.system.' Nearly'80percent of the taxpayers now

filing returns receive refunds. This gives the IRS the benefit

of a $50 billion float.

INFORMATION GAP,PROBLEM/CAUSE/CONSEQUENCE:

As of June 30, 198'2, total Cutptanding delln3uent general

debt.was"$14%3 billion as .shown by Schedule 9si: Status of . Accounts and Loans Receivable,'subMitted to OMB. After. living

allowances for debt too old to collect, inflated figureand

inaccurancies, we assume 75 percent is colleCtable.

General debts owed theGovernment should be offset against

IRS tax refunds as a last- resort in the debt collecticp process.

- This is an example of non -- utilization of data whichis

readily. available.

92

2.6 5 ,
PPSSCC ISSUE SUMMARY: INFORMATION

TASK FORCE REPORT: Health and Human Seriices/Management

ISSUE No./TITLE: HHS MGMT 3: Correspondence Control

and Clearance

DEPARTMENT/PROGRAM: Office of the Secretary

PAGE REFERENCE [REPORT (R) /APPENDIX (A)]: 41 (R)

THREE-YEAR SAVINGS ($ millions): $7.1 (S)

FUNCTION /CATEGORY: Benefit Programs

PROBLEM CLASSIFICATION: Structure

BACKGROUND:

Thorough, accurate,'and timely replies to all correspondence

is an HHS objective, Externally, correspondence responds to

problems, voiced by.lthe public,'as:well as Government officials,

and keeps the' publid,informed of Department and Administration

poliCy. Internally, correspondence is important fOr other

reasons, for it provides' a barometer .ref" public opinion and.dia7

seminates.information: Thus, dorrespondence not only reflects'

management policy, butis also used to formulate that pglicy,

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

Whsed on-the.PRSS. sample,. 21 people at HHS handle the . Arafting and clearance oft.iSecretary-signature response while'

only 8 people handle a direct reply;.15 to 20 people handle a

Secretary response within DOD- and 8 within CCUS. If typists,

messengers, and other clerical supbort personnel were included,

the.actual HHS number would increase to between. 55 and 60.

Not only is the .HIS review process repetitive and inefficient but the clearance process is redund4nt, cumbersome, and

time consuming. There are problems in the current and planned

EDP correspondence systems as well, particularly in the lack of

coordination and int tion between systems.

The extensive time requir*d and, the complicated process

involved Th Completing responses 'to letters received by the OS is

*aymptomatic'df HHS's organizational layering duplication problem.

(

The numerous evels of.review, the multiple .clearances, and the

delay in pr cessing, all .indicate too many'peoeple with similar

responsibili ies performing the' same funetion.

266,
All of the findings outlined above contribute to HHS's

substantiallyalower correspondence productivity and general

information management failure compared with DOD and VA.

`Jt

.1 94 267,

,o
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK, FORCE REPORT: HHS/Public Health Service/Health Care

,Financing Administration

ISSUE No./TITLE: HHS-PHS 2:. Indian Health Service (IHS)

Contract Heafth Services (CHS) Program

DEPARTMENT/PROGRAM: Public Health Service,

PAGE REFERENCE [REPORT (R)/APPENDIX (A)]: 121 (R)

THREE-YEAR SAVINGS ($ millions): $116.9 (S) (I: Info all)

FUNCTION/CATEGORY: Program

PROBLEM CLASSIFICATION: ADP

BACKGROUND:

The mission of the IHS is.to assure the availability of a . comprehensive health service delivery system that will provide

Indians and Alaskan natives opportunities for maximum involvement

in defining and meeting their own health needs'. This is accomplished largely by clinical care services carried out through

1) IHS staffed and operated -hospitals/Clinics-and 2) private providers. The latter comprises the Contract. Health Services (CHS)

Program, adMinistered by_the CHS branch of the IHS. The.FY 1983

contract, -care services budget.is $130.5 million.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

) Claims ,officers do not receive proper or timely information

with. which to make decisions regarding fee' structures andf the

claims process. Problems also exist in assuring. hat,alternative

reimbursementresources have paid first,Thefore m ing the 'KS.

the residual payor for services performed.

This is due. to the fact that autborizatiCh and.claimXpro- ., j

. cessing actiVities:arealmost'entirely manual. With over 680,-000'

documents being processed, a paperwork bUrden makes it virtually

impossible for claims officers to effectively carry out their

'responsibilities.

The result,is that heIffs mission May not be carried out as

intended and adequate. contract health-care services may not be

provided to the Andian.people. At the same time., lack of adequate verification of alternative. resource payments results in ,.

the,IHS making significant 'unnecessary payments. .

268
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: HHS/Publc Health Service, Health Care

FinAnCing.Administration

ISSUE No./TITLE: HHS -PHS 7: Improve Collections from pHs,

Student Loans

DEPARTMENT/PROGRAM: Health ResoUrces Services Administration/

Bureau of Health Trofessionals/Division of

Student Assistance

PAGE REFERENCE [REPORT (R)/APPENDIX (A)]: 165 (R)

THREE-YEAR SAVINGS ($ ($ 0.6) (S) (III: Info plus)

$30.0 (CA)

FUNCTIOg/CATEGORY: Financial

PROBLEM CLASSIFICATION: Structure

BACKGROUND:

'The Health Services Administration (HSA) administers a

number of scholarships-and loan programs designed to increase'the

number of health professionals in the U.S. in general and to

increase the number of health professionals eligible for service

in Health Manpower Shortage Areas (HMSAs). In FY 1982 the loan

portfolio had assets in excess Of.$930'.million covering 800,000

awards. 4.8 percent of:tKe. portfolio is in default at well ai

12.8 percent of all accounts. receivable.

INFORMATION CAP PROBLEM/CAUSE/CONSEQUENCE:

Financial data is not entirely reliable and is'not being

properly utilized to collect funds. The information is ina4e7 . quate aOto content and is not collected oh-a timely basis. The

' Health Resources and Sgrvices Administrati has not yet implemented quatterly financial reporting, incl ding aging Of'aCcounts

receivable, and it has no audit capacity.

Underlying organizational problems are the cause of HSA's

information defidiencli, which have'bevn the subject of.chroniC

Congressional, GenerAl.AcCounting Office and Inspector General

concern.

As a result, past due loans are in an uncontrollable state:

elapsed time betw.,een loan disbursement and debt service is often

JO .years,' minimum payments are not insisted upon and loan delinquency ratios Are very, high compared to private sector standards.

96

269 .
PPSSCC ISSUE'SUMMARY: INFORMATION GAP

7 - TASK FORCE REPORT:.,. HHS/POlic Health Service/kBealth Care

Financing Administration'

ISSUE No./TITLE: HHS-PHS 7A: National_ Health Service Corps Debt

Manatlement

DEPARTMENT/PROGRAM: Health Resources Services Administration/

Bureau of Health Care Delivery and AssiPtan5e/National Health Service. Corps (NHSC)

PAGE REFERENCE [REPORT (R)/APPENDX A)]: 181 (R)

THREE-?.YEAR SAVINGS ($ millions): $ 4.6 (S) ((I: Info all)

$21.7 (CA)

r FUNCTION/CATEGORY: Financial

PROBLEM eLASSIFICATIONt ADP

'BACKGROUND:

Oct

The National Health Service Corps plates volunteers in

Health Manpower Shortage Areas (HMSAs). A °steady supply of doctors for this program was ensured by the'exchange of obligated

service at HMSAs for a full tuition'scholarship and.monthly sti--

pend to medical students. The Government bills the HMSAs for

'these assigriees." 1982 appropriations were $131.8 million. 'Of"

the $100million due the Government, only 10 percent, has been.

recovered as of,December 1981.

INFORMATION GAP-PROBLEM/CAUSE/CONSEQUENCE:

The management of the program at the central lev61 has no

reord'of receiving payment_ pr nOtiCe,of waivers for bills,issued,

du.ring the 1977-1980 period, for amounts over $10 million. Of

this amount, over 50 percent is considered as uncollectable or

inaccurate. . "' D. This. poor controof billings and reCeivables is largely due

to the lack of data OroCessing equipment, standardized procedures, the Jack of gtaff-with an' accounting background, and the

preoccupation of the.'sWf with personnel problems at the .HMSA

sites.

As a result, there is a lad): of monitoring of the debt.Collection, and the delinquency rate has become excessive.

97

1 270
r .

PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE.REPORT: HHS/Public Health Service, Health Care

Financing Administration

ISSUE No./TITLE: HHE-HCFA 6: Electronic. Data Processing

- Independence . DEPARTMENT/PROGRAM: HHS-HCFA

PAGE REFERENCE [REPORT (R)/APPENDIX (A)): 82 (R)

THREE-YEAR-SAVINGS (S millions): $324.4 (S) (I: Irffo all)

FUNCTION/CATEGORY: Materiel

PROBLEM CLASSIFICATION: ADP

BACKGROUND:

-In.1977 the Health Care 'financing Administration (HCFA) was

created and separated frpm th Social Security'Administration

(SSA). Electronic data 'brocessing (EDP) and telecommunications

were left largely with SSA. Today approximately 85 percent of

HCFA's EDP work load volume is supported by SSA systems. HCFA's

system is outmoded and highly inefficient'. It is overloaded and

uses outdated equipment as well aS highl-y,lcumbersome sequential

tape'files. . INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

There is a lack of readily accessible information needed to

supRtir;t HCFA program.controls. Its Bureau of Quality Control is

basing-current cost studies on 1979 data which is the most . recently available from the system. In addition, HCFA's sequen-

-tial tape file's must be completely rewritten in each nightly

update, involving a :pigh level of human intervention and high

error rates. With :current systems, overloaded, information is not

- processed in a timely fashion.

. This is due to the lack of attention by Department- of Health

and Hutan Services top -level non-EDP managementto EDP matters-,* a

condition which is aggravated by th'e regular tunover*of the top,

appointed positions.

4 . . . 1 As a result there is no long-range EDP plan within.iitC,FA to

.-- .. 4j AV' provide for orderly development and impiementationotataxe-of-:

the-art data based systems or to break the dependeperonESA's

outmoded- EDP syst'em.,- '11Us,, HCFA expexiences.-poot!Wr4nis.tration

and.finalicial controls, as well as a lacXAD.f planning.

.. -,.

I

*
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT:' HHS/Social Security °Adminibtrations

ISSUE No./TITLE: HHS-SSA 3: SSA Status of, Data Operat,Pons

Centers . , DEPARTMENT/PROGRAM: Data Operation Centers'(DOC)

PAGE REFERENCE [REPORT (k)/APPENa/X (A)]:, 80 (R)

, - THREE-YEAR SAVINGS- (5'millions),: NQ .

FUNCTION/CATEGORY: Programs

.- PROBLEM CLASSIFICATION: ADP

BACKGROUND:

Th.4'i income side of the Social,Secut.itY Administration's

(.SSA). processing is done in 3 DOCsv located in pennsylvania,

New Mexico,,and'California. The income°8ata is largely

"captured from W=2s and other similar forms in a process

known- Ps Annual Wage Reporting (AWR). The':AWR process is

critical tothe SSA's ability to provide timely information_

offices regarding potential benefit claimants, and

to a number of earnings comparisons.that ,should be made on'a'

periodi=c basis. The process is complicated:wittl_input

coming from a number of different sources and' reported on a 6

.varite-ty of media (paper, magnetit` tape, 'floppy dibks,etc:).

Extensive efforts by SSA to obtain more, comple't'e inforMation

and to correct erroneous data are time consuming; making the

true processing cycle more than a year under the best of

circumstances.

INFORMATION GAP PROBLEM /CAUSE /!CONSEQUENCE:

-,SSA is unable to prOV'ide Eithely and accurate data to

the field officels. The SSA. maintaina a suspense file whiop

contains any wage item that cannot be posted

a

, to an indLvidu- . al's account doto errors np,lomissions re'porti'ng

"Currently, this file hps grciwn-tos6Me-.138,million items

valued at $89 billion Bollars. :SSA is unable tor'46ake

_thorough computer" Vleckg becaUse until recently,many, of the,

suspense items d4ing back to earlier years were not:in

.machine readableyOrm. tThese.records arestored on" microfilm and predate%the.adv.ent of. automated data "proces"sing.

. CONT'D ON NEXT PAGE]
r.

INFORMATION GAP (SSA 3 COilT'0)

.. systems in the SS A, The conversion of these items. to- Mag-.

*etic'medikAsexpensive and time consuMing, SeCondly, SSA

f4t-unable to, CoMpare.e4rnings reported on W-2s to the beliethatare'actually paid. This would. allow SSA to

. determin'd overpaymentvand Other irregularities.

. . 'These problems arise becauie of work backlogs in the

titer center and the lack of computer capacity, as'well

hp. transfer of the files to (ftskstorage- replacing

Upc tapes now in. use.;,;'

1,,,s a result ofthese,lnsUfficiencies, the account which

,JAiOAde. UnOcksted. earnings /is high in dollar amount and is

.growing..., This causes beneficiaries to lose benefits.

Fu,rther,- the irlability. to comptare the earnings reported art

'.Causing beneficiaries to defraud the SSA resulting in the

.misallocation,of.''

a.
PPSS.CC ISSUE SUMMARY: INFORMATION. GAP

TA3K:FOACE REPORT: HOusing and Urban Development (HUD).

ISSUE No./TITLE: HUD 1: Financial Managdment Systems

DEPARTMENT/UOGRAM: HUD

PAGE REFERENCE :REPORT W/APPENDIX (A)): 9 (R)'

THREE-YEAR SAVINGS ($ mthions): $292.7 (S), $278.0 (R)

'$222.5 (CA)

FUNCTION/CATEGORY: Program

PRdBLEM.CLASSIFICATIONADP

BACKGROUND:

Prior to-1965, the 'Federal. HauSing Administration (FHA)

and the Department of Housing were two independent,

edministerS.complek public housing and7.community,lelelopment

Government agencies. . In 1965 they were.merged,:: HUD now

programs:combined with the Signitidant mortgage insurance

functions of bne FHA.

INFORMATION GAP PROBLEM/CAUSPE/CONSEQUENCE:7--

. ,

' ,-.. . . o

. No.one area of HUD-ha's beep given total responsibility

and authority foc

fin ncial

and developing.

Departmentvide fin ncial systems. -, Indeed, there is no

.lentity responSible'.ffr-pn 4ing pperattonal audits of

HUD-releted'activities. ,040 4,

J. *

The result,°of.Hcourse,:i;s that management does not* have

. the information required tquege2programoactivity and

effectiveness. 'IrCeffect, often times management doesn'tknow it-Soesmit have all the :relevant information' reqUirdd

for informed dRFision - Making._

0 -

!Pe
- PPSSCCISSUE- SUMMARY: INFORMATIONtGAP

TASK FORCE REPORT: Housing rd Urban bevelopment

ISSUE No./TITLE: 'HUD brganization

DEPARTMENT/PROGRAM: HUD

PAGE REFERENCE [REPORT (R) /APPENDI -X (A)3: 4 .(11)L

THREE-YEAR SAVINGS ($ millions): 69.6 (S)

FUNCTION/CATEGORY: Program

A

PROBLEM CLASSIFICATION: Identification

(HUD)

and Administration

BACKGROUND:

In the 18 years that

bad -seven Secretaries and

Assistant Secretary.' The

tiered: headquarters,` 10

field, offices.

HUD has been in existence, it 'has

60 different individuals as

current structure is three -

regional offices, and .86 area and

.,

)

:<,411! INFORMATION,-GAP-PROBLEM/CAUSE/CONSEOUENCE:.

Too much data,moves throughotffthe organitation.

Typical ADPreport-e.at' HUD are.. voluminous and the detailed.

information they contain-has been fOrmatted toward_. the

lowest level r*pon'Sibie)for.procesSing the work, not- ;the

;individual aponslble.for Managing,it.

The .is not in.asummary t ormat that managens. Can

use .to make,XleciSions:readily. Several re .on, area, a

program managers in the field and headquarters stated

.. , was amajor reason for', high levels of admi.nistretive

staffing They

AM

stat that they need people turrOthe

'detailed., volumioous , 1 formatnA:, on into:more vorkable,usable

data., and do not:,get Support frbm Offide of'Info'rmation and

.,' Policy Systems (GIPS) . The. Chicago ,region-, for inStanC*,

has:Alad a complete set:of specifications for a financial

.4".manageMent,system "under review" in headquarters f9i71:e. ht

`months. They cannot .get a deCision',theyhave:Create

own ad noc-reports'and processing system;
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORtREPORT: *HodSing,and Urban development (HUD)

ISSUE No./TITLE: HUD 3:'Debt ColleCtion Management

ja 4P . DEPARTMENT/PROGRAM: HUD-.

PAGE REFERENCE [REPORT (40/APPENDIX (A)3.: (R)

THREE-YEAR SAVINGS ($

FUNCTION/CATEGORY Financial

PROBLEM CLASSIFICATION: ADP

SACKGROUND: lk

As'-of September 30, 1981, accounts- and loans

receivables amounted -'to approxiMately'$13.9 Million, of

which $1.6 billion, or 11.8%,' were delinquent.

$30:4 (S).,.,.$285..9 (CA)

',INFORMATION GAP PROBLEM /CAUSE /CONSEQUENCE:

The monitoring and collection of ,delinquent accounts is

hampered by antiquated ADP systemS.:'This results in delayed

calildctions, or even in no uniform collection

across-the-board.

,

It appears that HUDhas no accurate i ez of the total

-

. The'inpffecti.ve accounting, system contributes further

to HUD's. debt- collection pProblem.because no precise

assessment of add,oUnts'receivable is available.

s.

0

.
- pssgc ISSUE SUMMARY: INFORMATION GAP

TASK -FORCE RkPORT: Housing and .,.Urban Development (HUD)

ISSU 'No./TIT-LB-: HUD 5 Verification of Eligibility for Benefits

Az`

DIERTMENT/PROaltAM: Section:84- Lekfeda.Housing,

. ,- PAGE REFERENdE [REPORT (R)/APPENDIN (A) 3 t.ab8 .(R

THREE-YEAR SAVINGS ($ $1,870.1 (S) Info all)

-FUNCTION/_CATEGORY: Program . PROBLEM CLASSIFICA0TION:v Analysis

BACKGROUND:

! The Section 8 program, the -largest of all six, housing' programs in HUD, -had estimated outlays of S8.9 billion in FY

1982. Under the Section 8 prOgram, HUD makes up the differ-

- ence between what a' Zbw income haftisehold can afford and the

fair mark-e-tre-rit'for an adequate unit.° Eligibility

for Section 8 assistance is genekally, limited -to iridkvidtia;,s and families whose incthrle" does not exceed 80 perceht of the median income for their particular area of residence.

4"--

INFORMAICN' GAP . PROaLpl/CAUSE/CONSEQUEF5F:

, . The ,Inspector: General has corrae6vati"!:41.y estimated .that . . , between 12 and 17 petrcent of the; tenatitsk reiieiving housing

sLibsk.dies under the Section 8 prograhfad.s4v-informatio9Ito- gain benefits. HUD provides a handbook'triedeotermine, applicant eligibility in accordahce WV, dpre.1 regulations but the .requirethent fof. Veri,fication *is enerak .n %

nature and does not, stress the need tb e shi appliC,arrt 's ,':

income.' As a result,, each dif..t.he local sing. uthoriides are interpreting the HUD' handbboks indiVidUallj and each , uses different methods to obtain the required financiAl-

- information.. _ . ..; , . . .. , . NEXTPAGE]:_

'VI4 ..

,

104 ,

.4 277; if
AID INFORMATION GAP ,(HUD 5__CONT'D)

In spite of the recognition of the inaccurate',

fraudulent data/. there has been no attempt to employ'

computer metching for follow-up verification and .

investigatioh. ` ...This inadequacy is the result- of the incentive -to "get

th money t' ;wf le;procj am monitpting has re'ceived a

subordinat role... t :.. As da -result .of the,de peobretria 'there is alsubstantiai

fraudf&nd abuse in his pr am. The total

insg.pqoper

. .

'AV

cr. amount of wa it

reCiPien

v.

4

- .!.

.

'

e

04

A.

.

e.5.,

-

.0' o' I

' - Jet!! cmr ) 71; -
PPSSCC. ISSUE: St SMARY:` INFORMATION GAB.

a TASK FCRCE REPORT: Department' of the, Interior

ISSUE No. /,TITLE: INTERIOR 9: ,Cash Mbnagedient.44IMprovements

DEPARTMENT /PROGRAM. Office of FinanciAl MArtagement

PAGE REFERENCE [REPORT (R)/APP4ND/;;IIK-(4)j.!... 84robiR1

' THREE -YEAR SAVINGS ($ 1:571' 'Info plus.) $219.9 ftAf

nancial

Abst3

o PROBLEM CLASSI

BACKGROUND:

.,s A

... Through various programs administered ,by the.Minera).s Man- agement 'Service., Bureau of Indian Affairs, Bureau Sofapand Manage-

.. ment, and_ Offide of 'Surface Mining, the'rpepartment "Oir Interior collects bonuses, royalties, fees, and ee ts. 'Estimated ,receipts fbr 1983-1985 are $49.6 billion.' Each b au,and office in t Interior has deliglopted iCi own cash_ =11 ceic;ns and disbursements '' ., syste-m. X11.- bureaus and offices deposit "receipts at- -Fetter-at---------------- f

' Reserve IfkarikS or Treasury General Accounts. - thefiime it takes 'to oollct al.15aymen.t through the mail 'record :it, a deposit it

.is hot -urfusual tor this ptocets to -take n cash mausgement.systems can reduce these

or two days.

4

,,eZdeed.a week, a

i . .;. .,,..weeks or longer. . . . ,0

....,,,, processing delays,

40

;INFORMATION ,Gat 'P

There is a"!

"processing recaej P

can

two

4

AUSE/CONSQUENCE:

*, fV. adegua.te accounting control and Speed 'Of ;the':vatiousi bureaus and officeS at Inte- riorthat are concerned with' collections -and disbursements. Th4 isr no cerfteal source for ,reliable information on revenues and disbursements,, which.;couldibe useful to-manaelnent in reviewing and correcting, problems vitrh.'casty i,lac inent

1

..-. . 5 . .6,-v *- ,,,:,. ,

A . 5 S' .

>f T*I i 'is aue' tO the.,autbh y, of the',9perations a ri-d, .t.h.eflack . . of centralized., dtrectiont. and' Lopt over syStems sniff repOrti,n,g.- Thee g ff ice of Financia1 Managieepent,;. not ye., coord.inateci the.. .4 '-

repoF4,ing requirements: of thi via ridyek) bbrea us- and' of fi;c-bS "..-p as

tp be 'able. ,to'cieveipp.- sta,ndeirillized crrents,'- .0i,..;,. to.Consoli,date'.,

coll'6-CiOn' opegat. ion,s.:' -, "i'. ..°. ?-- :

c.,, -; - -;,...-. "

.1. - As a .:resulb,°'here proc-ess4nOdelays.; the -Trea

and must borrow

4 i-4e,:reiat- expense. --".

:7 ..tV ; ,

A ;g a th e x pehs4pe .adrriinAzstra.t'il.e .! : 'doesiinpT,. bay'a: dtd:pft.13§f4-hits:,:;;^: crti'Lcae4.'nee'dS, terst34ttrig:1n- e

. r".c.,:*,' .407..,....'!'.....:' -7-' ' --'

,

. ....

.!... :-?, ....- -0, ,-

..% .. iv'," . 7. .-..-.. '"--.. -. .. , ;± 'y ''...::. :

1,:i : ": '' :,,0",-.;-, ';, 14. .4, ; .,.. : 1 t, , ...... - , it

2 P7

4, , . . . 4'4 - -4' - .- t..."

n. ,

, ± 44Ve
TASK

, PPSSCC ISSUE *SUMMARY: INFORMATION GAP

FORCE REPORT: tlepartmeht of JuStice

- ISUE No. /TITLE: JUSTICE. 1: Uncollect%d Revenues

DEPARTMENT/PROGRAM: Government-wide

PAGE-REFERENCE fREBORT-i(R)/APPENDIKJA)]: 14(R)-

THREE-YEAR SAVINGS (Skillions): $ (S)- VIII Ina) plus) $626.1 OIL, $44.2 (CA)

FUNCTION/CATECORY1 Pknahcial.'

PRO. CLASSIFICATION: Structure

4

... IS-AC K-GROUNI: . 6

, . The DieRartment of Justice -(DOJ) acts as a 'colltections::- -. attorney 'Lot other Federal agencies. and-it- acts ais

2 c a; orney 'on :.. b.. ' behalf spf-- the United Stapes, in connection with the, le's,:tiv04 CT.

-civd1 and criminal. fines and claims "owed tophe. U.S., .Colleions : as -a perCentage, of- total receivables has. decreased, 'each:'t.Yeai i

Since FY 1979. Debt* receivables in. FY4 1982 were ,vet. $1.' billion,

.

6 . . P .7 e

INFOBMATION GAP PROSLEM/CA(Ae/CpNSEQUSNCE: : ...

. -

,. V-ti3 percent Sf the claims requlring legal action by DOJ 4, oxiginate In Other Federal departmentp and agencies. .no,7 is

'refit red ,to carry such'-out ttding bill obligations or. ,their o

books. OCkr colltection,ef fort suffer. from a lack of unitiortniey.'. in .the: data suPpfied by -tii%-' originating agency accountirtg "term;

monigoting ,procssees- emploed and. definition Of what, cceistiAtures

an, xr.ze?due account. ..7-% .;-1°-.

-

. .... . . ... ir.

.-. . The lack of . uniltormi.ty arises from a decentralized,

'

4 ' . .. collectiop and ,credit process'''in which each agency est-a shes.

.

, i.ts : polici,es and procedux-es to "serve i particular tpurpose1:.

, , ,- ' t 4

.

.,

. d.kj,,a ,reSul,t.;Zdebt;,receiyables management has t bteeri'

effeceIve.:. The nucnber.;;of cases reoferrtd -,D,e[Sar ntvof crtilVide ,t . of or, citill le c t iofTeof'4..furidS .owed ,tir.Edederala. OYe-rjnrign't '.is ict. ; ,.. '-

64rious trackio4.....: "Ap4citir'IO data ,,I.Zi...;-;.4ilsuf iMc14 resat- al. tow. ,,,,,'. , ';'.

.,cbmp*--iSon ciftD raE it abi:svaff, ,'Cotcaseload.: This, Makes ao..- --

.'"'''

, ,

arlalSisi,t)f--;tfif qrstliztV.c.;?.entrtitarff lev l impoossible,..-,fi ...-

1:::::

,e';" ''. '4" .:, e - 4,:ii," . -,,,A '. - I '",..., ,.. , . . ,. .,. , 3. ..-..--i .,.1.:'404Y 0, . , :1 t ..-1: %V, f -, r . ,. .% . . #.- ; 'la . 1. I" ,-!'' k :::)% J -.s. ;: kir .4 7.. V4 $. ..... , ,,,p, i---.0 ...'f-:c *.:' ,..1-t,..,,,. t ''''4 °. :1).,- 8:4,' 4

. '': ... ai a - - I a.. ..-..- , .,, i ,.a 74 ,

. ... . . , 4- 4 ; . L; . f i ,:' 'A :

Pi 4

If. jr*.

,,' ;,. .

' en

' e ....,"A ' : ..' ''''. -". p.., ., t 4 A . i ;.. .

',..,.. V.:i 4 . I* ., =.1

IC *

: ,,e ...) . ';:' - .:

4.1t. 1. 1

. -+'. '

. .t -.0 1,) ,

- -

:A .

-.. ow: . ,

I . 0 4 7ez, ith

,, %

... .7-7
0

44-

PPSSCC ISSUE SUMMARY: INFORMATION GAP,

TASK FACE REPORT:

ISSUE No./TITLE: JUSTIGE 2: Asset Seiz,lire and Forfeiture

Departmnt of -Justice

DEPARTMENT/PROGRAM: gOvernmerit-wid

"1** PAGE REFERENCE (REPORT (R)/APPENDIX (A)\:

- THREE -YEAR SAVINGS (S millions

FUNCTION/CATEGORY:- Financial

PROBLEM CLASSIFICATION:- Quality'

'BACKGROUND:

27 (R)

$. 48.8 CS) (III: _Ingo plus) $244:2 (CA)

,

.-.t .- ,-1

. , .Varic*s investigative or enforcement .agenciee such- asi., the Drug .Ehforcem.nt Adininistration; the Federal Bur-eau of Investi. ga tio.n and the ,Int,ernal Revenue Service seize assets in conne- .- t'ion' with their, iriArestigations and arrests. These assets -ere.: then held in custody pencalpg the results orubseguent aCtion.'''` Action taking by .DOLV Subsequent to the seizure of an asset may. ... jcnciu criminal or civil prOceedings whidh result in forfeitdre,: Esti d total GoverriMerat seizures. in FY 198.2- were $317 nii'lliont aap thi ty, pe r cen ..f i-oir'i the previous fiscal year.. , -,0

....,,,

.

, : 4

INFORMATION_ GAP PROBLEM/CAtISE/CONSE-QUENCE:

, I

,Government or totals for aeizLire and forfeiture of , aSsets is. not regularly collected. 'Asset forfeiture recordke-e:ping.- Is on a 'case-by-case basis. ,, GovernMant totals- are 4

-i'avasCable_.gual.yi -in the forti- of estimates: Even; the 'best agency

reciVr'ds are "neittter 'consistent or' complete'. .., .

.. a a, - ..-- ail , . .t , - , ; i' - -'. "4;

, . her,e-+ is Cu r r cr,ly- r),177; river s h't Of procedures !v. p.ratot'tices by 'se n,g a gtric i ..;i.z`ed asse i n tOtrrelitA nd Paillbae-

, t

. ,dispos to,ta141Y tral i zed . T htt s z ttci 10. lt ; the custcdj..i gwencri and..zt e posing!,agert may Alot'.1:0e; ette.., . .saftie and may not have the,sime r r ch'atkp.e o -off ite has

, e

,"' a compreheSsive;aparspective

. ,

'zure

1- As nance and di,sp n 2../e.111.:.

. ' otdri t'e'd is,C1*.tAty Oa -*InAre'rit r k is nowt

:.kr Eo,,sgieit' .o0r, Ring 14* ,p0,W.O.

., el, f..tto i;e-,..,, "*"or fti,terj caste n..qt tiOttd; i6. the ;

... thy 4)1i.ictitta.t4...,ite):1..iaitii;n.. of, per tc3s itiom 'di' pi:3 g i ',.i. .' ,.....:.

.., ;...-.--- .., . -:,:, *.-, . :. ..f. - , ,h. ,,, . v i *. I * ,-

. ,.1 - .--...

_,,,, : ,...., ,'. 1- - ,2-1 i.:t '-., . :,...1.- ,.. 4 .-.

? - , jk.; :. 1 . rw" .

if.. e: 4 . /si., : : 4.: ,f - ,;--1 ,t; , it r 1. r . ,r::-." , e ,. li , 4 s to '..*,11114_,' r ... ., h : 4).-"ii 11 'I +t *k '.! :

' °I did si..4' tl ''.4.' 7 :' P'0 l :t4 i. v 0: rak te."# At 2t;s. °, 1, ..!#.tv''.46 i- Ai':,-.1-',.. * '1/1*.i. .A , t. .-. . .,,..; ,', . 11, 4 .: 4 }if. ;,.. :

.tea 6

Ite,A

. 1,41.4-.;

- -It - ,

, .a

- \;.. i..

24' +. -% tt.

& .
PPSS& ISSUE SUMMARY: INOORMATI

101

-TA4K. JoRci REPORT: Department gfJusti4e

ISSUE NO.ITIT4E: JUSTICE 3:0 Travel ProcureMent, Expense

Accounting .and Reimbursement

EPARTMENT/kOGRAM4 Department of Jusiice

. PAGE REFERENCE (REPORT (R) /A.P.PENDIX (A.)]: 37 (R)*

pp

THREE- YEAR SAVINGS .$3.6 Info rues)

I FUNCTION/CATEGORY: Support Services

PROBLEM CLASSLFICAT.ION : Struct4re

1

BACKGROUND:

In FY 1982,.r DOJ spent $106 million on employee

lodging and meals/ and other travel

related expenses. The- management of Federal travel is

deipntralized atib is the eesponsibility of the individual

dePartments and agencies. The minagenAnt of travel within DOJ is

only partly centraliied through its Comptroller'soffice, which

handles financing, audit, and review of travel for 'the depart-

. mantis various offices, boards, and divieione:.

. , . INFORMATION' GAP PROBLEM /,CAUSE /CONSEQUENCE:

4t.

The DOJ mans ment of travel, is lacking information wth

respect :td lipthpr curement.opf travel And" processing of payments:

DOJ does not, ren ye regular, 4iir.rent, information, on-GSA

negotiated rate for travel. The dAa :are 'not eaaily..Accese4ble -.

or timely and t efore Gravel is 'often4.procured 'at leee'tetkh' - 7 'optimal rates. The voucher Claim4 reimbursement. process is,.

=, cumberaomedin its reptAkting and ac4ounEing 'procedutes. Administration ot this prioRese. is costly. twdausfof the 1.abor and

computer ,time regdired tdr proper reconcllia0op and m'onitoring

of the vouchers. A', 4 1 - --1; .....c..;r k kz, ...,.

° " ' ., ..4 4 t ..N. s

'' .pe... These problemare rgeri ..dde tothe, deleAraliied.:natqr v. jai

...

. .. of triVel Managemerito . T le dbrrOnt systm:Tails., ito hold' the,,

s. ; traveler -euffiCeentiaCcoUntable- on 'a' ti.m#,Iy.b0is Ifor:. - . ekpenditiJies, and..0111,refore, fails to -prbVide1,adegUate lrigentiV'es

, . .. :tot, '.,timellcCOUnting' and .0/turn, of advah.ce's and '=other iydnds'

:.!:: :, ,4440 the'. .341 .&- Y -":-, .;:, -'..-: 11° .f; '. . ,..1

I. . ,.. iC

IF '. '! ; , f C%',. . '''t , ' *: ..: .. 1.i 4:.10 # .,. 1 '.44,v , - , !,- As 4. reap .441. ttese.T.4pforman:ina446aciesi travel

.

' ik '..fia1:rtIspageinqitt ..iir' e.16oth .Mone co4t.r' thanIne'ces'sArly,,- ..'. . ,,, :.,, , .,. .''71 .k. -6 ' ' '. % 4 O X09';., . !le, '6,

. . Ia. , .. A, ,.4', 4:* ,14,, '

r,..:- :' ..; A t l : . .%;,-0 . .. '

: ;', H;,:',; ...1(' ; ',A. ; , . -',$

' '' f , ': , . ..!: . ,i. "± ..

1.4
1!$PSSCC ISSUE SUMMARY:. :INF6RMATION'OAP

..

.00

,..TASK FORA REPORT: Departillent 1:4JUstdce

to LSSUE'No./TITLE: JUSTICE 5: Department

,DEPARTMENT /PROGRAM: Office of Information Technology, Jus,Xice

. Manag ent- Division 4,p.---. PkCE REFERENCE. (REPORT (R)/ Ix (A): 61 (R)

. - . THREE-YEAR.SAVINGS-(S.millions -. tipFUNICVIONicATECORY:, Materiel

PROBLEM,CLASSItICATION:

BACKGROUND'

Asp

The Office of, Infordration Technology. tOIT) Ope'F,fikes IleArge,

complex dat#,Centex a.nd maintains the genkraJOILOOSe.ADp

tents, which include flirancial, adirounti.ng, and :data,6age ,. management systems. The. Justice Computer, Service (JCS) ,provides . "botti-nardware and sOftware,deVeloO-Mtnt service's.- There is a

.program.currently underway to ,pgrade and repl&ce the computer

'h ardware systems. . .:, .. ' INFORMtql$ON GAP'PROBLEM/CAUSE/tONSEQUEtcE:-

, ,.'. 'the data center has not always been able to meet user

reguilements:i6 a timely ancLefficient mann

4r.

The tystem's

4' support staff.cannot adequately ;h4ndle.regu s, from 46 users.

7,-Irfplanninfor their'new system, DOJ needs.Mpre information

regarding the costs and benefits associated-with a. centraitzgb.

data center and the costs and benefits associate with

decentralized ADP ser.tces. . - Therproblems have atisen'as;a result of the lack of Planninfg_

efforts and theprOcurement 'procedures and policies, _whicilhave

\not been flexible enough to be responigIto.users' needS/i.

, .

. .. .

, , As a result, many user'grOups are uiring their in -house

capabilities, apab

. i. . lities, and have. essed.dissatisfaction wit the data

center:- The use of 'Obso. te..syStems.and*the :uncoore-inated .... #

_

. .acquisition.of-new.systemS:0*utS,in. wag,teXul expenditures.,
ter -PPS3-CC-JSUE SUMMARY:

. :t. INFORMATION-GAP':

, TASK FORCE. REPORT: Department of Justice'

-.ISSUL.No./TITLE: 4USTICEf,6: AutoMate4 LegalSuPpOrt Systems

DEPARTMENT/PROGRAM: Office bf Litigation and' Management

Systems /Justice Management Division

.PAGE REFERENCE' [REPORT,(R)/APPENDIX (A)]: 69 (RI

THREE -YEAR. SAVINGS (S.millions): $37.3 '(S) ( FUNCTION/CATEGORY: .Support Services

PROBLEM CLASS,LTICAT/ON: ADP

BAtKGROUND:

:- Into all)

4,

DOJ..represents tpe,Federal'ObVernment in Art:legal actions

filed either againstor 'by it in,theFederal courts, The

estimated 1983 ca'se'load 364,796 handled by 3,799 attorneys.

and a total. staff of 7,959. The litigating divisions are heaa-.

quartered in Waahington, D.C.:, Eachof the litigating div.isions

currently utilizes automated support services acquired from the

Justice"Managementigivision on a reimbursable fee basis,. from

.:outside contractor or internal capabilities. DOJ does not

routinely gatnerinformiltIOn-o-n-basic -cssei,imformation such as

the number, type, and status'of cases. and investigations in ,the

dfyisi9ns and the offices of the,U.S.A-ttorneys..'The case

.-,;-:_4!'L*441a,ggpellt,. system contains limited workload information, which is

incortfr.t40d contains,someinaccuresY A comprehensive,

Syst4Wapproachto lktigation has notevolNied so that experience

gaihelduring one litigation dan,be iutilized effectively -during

otper litigationsSS division is 'currently developin5_4ts own

case management aWd' litiOtion,support,iystem without regard to

hardware and software compatibility.

INFORMATION GAP PkOBLEM/CAUSE/CONSEQUENCE:

These problems are a-- result -of 'the lack of,departmental

coordination.-

.-. . Tht, ;thre is a duplication of effort in attorney and

program r:time, the systemurrehtly-dOes 'not meet the

requiremenCbf:its:user.4.;.,,th sl4tem is' PrOducrig.usef-ul i dep4rtMentai reportf,and'..ia. notibeing....utUiZed.7 Further( data

... . k.'

[CONTib'Ois;

a t
9.

.INFORMATION jaUSTICE 6 CONT'D)

from various divisions are ,not uniform and cannot, be aggregated

for J.epbrting or insiaaveM04t'purpo-ads._ The 'litigation pcoparation

and management is. Sulieririg and this.'place&_the-o rnment at a_

disadvantage -in"-terms -of being adequately prepared

o
.!( - PPSSCC, issuz :SOMM-ARY: ,IRFOftfIATI0N

TASK:FORCE REPORT: . Deparitment of Labor

....,

. . J -. .. l I 1.. ISSUE -No.. /T.ITL.E,:e -Litt 1: Opportu*.I ty .re Reduce AloUSe in

Fed 1'Workers .0 pensation :..

. , .,-

. Disability. PrOgrart#

. 4 ..DEPARTMENT`- /PROGRAM: Office of WOrker's ComPensai..,-ten.. Programs/Federal EMproyee is . Compensation Act (FECA)

PAGE REFEREMCE-CREPORT 7-(-R)/APPENDIX (A)]: 6 (R)

lr;

THREE-YEAR SAVINGS- (5 ral.- lio ns) :

.,:. r.$,

1478. S,.0 _(S) (I: I. n fb al-l-)

FUNCTION/CATEGORY: Peraone1 - ,

.,, 103LEM CLASSIFICATION; , ADP. ,.

.."; ...- l' (0. r

i, BACKGRqUND:

4- ,*.-

,-

, . The Fe4eraV Employee ' s' Compensation Act:. (FECA) was

..enactedin 1916 to a tuniforM-tworkmen's -coropenSation---

-for all civilian. Federal employees The actoproi.rides monetary compensation, medical; care and assistance, wodatio9a1 ' rehabi.litatio.n; and reemployment .. right's tbFederal.' .clivilian

.employees who wtain disabling ainjurlea.aatipedult gf. .,

..

_c, their- emplo-Y-Teat ---ui-th:_the_ Federal___9bvernm_et2 . The system is

administered _by. the DepartMent` of -Labor. CT6-1;in-s---p-r-b-C-4-ing ---,.

occurs' . occurs' at 16 regional:offices throughout `the country. : The s'

system was responsible for-the. payment Of approximately $829s.,..

million in 1981. for ,both-compensation benefits and reim-; ,,..

bursepent_zfa-c_medical expenses: Since;:1966 the nuMber of ..,.. indifiiduals redeiv,ing,--clamopensa,t-ioni under- ' the. system for , Font -te'im traumatic injuries "has, risen to -48,eoo, an ir3.4 : .:4*, ':crease of almost 150 pegent.. This has drcurred cledpitet 1.1e ;..,, .- , 4 fact. that.' the number :of rederal .emgloyee#, has de*reased : AK- . slightly over that period, 16y .011Y,0 0,. : It' *-4

. :

. ilif

.g!

'

INFORMATI lig08,LEM/EA VCONSE0E11.0.E:

^.° . The, a ncA do6s. riot .h a. 4tattat.,ica'ri .p.4c kag4. of Sta

corvOern-ing 94genCie4 ims offices;

Phyg.iciahp iden til:Y09',..trendS: and $uPP1Y1W9t.;

'the t.r? for:pat iori ne.-essa,cy for a4m blister ing th :iprbir.fra

7r1,,Padciatiorti, "the 'info'rttiation, "that" lava Liable

1CONVD 0 NEX, -7PA o $51i p 113 1V- $ I ".'" 4$.

.28 g f-ab!-

d
v--". ..ci. , 01---4-hcle.e.ffectivel,y,:utiiized -id the.-.identti.ficatiOn of 0o.ssibIef abuSe: a!SpecifOally: ° - 1. ,. o. The vyateip.'dcios ryttetr..oprreate Specific disabili-

..."----- ti.es.,with specified '.time-" periods -irk. order to ; _identify. those- instances; Where. absenc exceeds

:-.._ estaiblished"meakdal guidelines.

'...'°'

, A''1'''.'..-/ There Ais no package of statistical report's to aid

. . t 1-' jin,,the tdenItification of 'possiele abuse. , 5. The 'current ,system does, not .recfgete verificatidn of: the medical rrecientiall of the physician -certi-fying' diriability..' .. - _ P

g ' ,, 4 .. ga.yment0s t.:6 Claimants .cDntinye 01.ess stopped by;

. examines: action. rather thanleeasing at ;a specified time period. :. -

c itiE4ORMATZON LABOR '))

v..

. °

, Submditea 'more iittarr: one. region ca,knot b zietect4d., . 4 . hi Employee is,,nat verified acaainSt a

t i le

fhere ;is ndentiaAs .of .the-,physieldr1;; eer.tifying

,

0.., 'Paymenta. to c.iaimans..c6itt-intle."unles-s stoppe.4, byt ,-,

.

,° _ . , exaritie4 actiort..eathe4. than deaaing a;. a ...spec,ified,.. ,-.3--

1qt V I

r i.me. period.

. ., '-

Y;'g'

. . ' Claims: 51.31:ijnilt;d 't cire tharri4e-regiclp.cannot be,

t ' . . A .- , 6 , ,, tmploVite .41 ill e,kt pot veti'fiechi,agai-riat. 'a ..-

"..,Imait;er47etnpb.l.oyee file 4 ° i. c , --TheEe. no or 6 -ss. ef,e,lrenoe tol-Atherwage.Preplace-- ment.i,syStems- zi if kmptci_per 4aymehtgliof "-banefi liSP`.::::.:-i,", . ,-. i ........,,., ... ........x. -. , . ,. . ...., 9,..., ._

-* 4. . ..:-,. .... . : , '' ' P,41.. - 1...- - ; .,4k. -* 4 ., a, ., , , a. ; ''' VI. -il'i..cs.t.on

-...:,.',

-', . ','.. . ':

o

, 7 v § t i

.,..9,...4-.,.,'4e'

r e d t Oe/cify.,insjirialh'i;hctma y b,! employed while

,. F,Lebtifiq.1,:te.4 7j z..,41-; k* 4--

-.

:7,..

. P h

,..> ,,.. :. ;r.,

,,g,: S'

. . , , --Y

. ! ... -

-

ryr

- P7

S ,

`IN.' L. ,1!

,
INFORMATION GAP (LABOR 1 CONT'D)

:Claims office philosophy,and practice is driven_by the

'requirement to pay claims ;quickly with little etripliatiSon

controlling potential abuse.. The limited controls that are

nor in place are usually_dependent on employees following

piescribed manual procedures. .A failure to adhere to these

COntrolA does not prevent the initiation of. compensation

payment. Even when such controls are enforced they are., not

enforced unAforMly thrOughout.the system.

As 4. result, the monitoring and control functions

within the FEC-ADP system are inadequate- to detect abuse.

As a result, tens of millions.of dollars each year are being

misapprpriated. °ceps of.adding nineteen. The civilian

'personnel office at the Office of the Deputy Chief of Staff

for Personnel has staffresponsibility for thiese centers.

Learning ResoUrce Centers provide a wide' range of training

intended to promote realistic career and self7development

activities and opportUnieies, fOr bo.th military and civilian

personnel. There are, over 125 courses offered.-.

115

288
PPSSCC'ISSUE SU

TASK FORCE REPORT: Departmen

ISSUE No./TITLE: LABOR-4: Pr

Improvement

Meas

DEPARTMENT4PROGRAM:' Office o,

rAdministr

PAGE REFERENCE [REPORT

THREE-YEAR SAVINGS ($

ecret

anagem

FUNCTION/CATEGORY: Personnel

PROBLEM CLASSIFICATION r Stru

21 ( (s) (Ifi

t. BACKGROUND:

l ilis r 5 Olk

I Th:FpurpOse_of the Dep r V4*- Labor is

and develop the-welfare of wage. rsof the U

imprOve their working conditions;;;-

opportunitiei for proti.table ,emplalf '',i-Ina

. ;AT mission the Department otLabor administers' ove

. labor.raws: Its'Operations are carried out by:6,

the Bureau of LabOr Statistics, and Departmenttlik

. has about-18,000 fUll time employees: 6,004 in Ws

12,000 in the field. FOr FY .1982 it. obligated ab

The Office of the.InspeCtor General ha'sexpressed, ncer

an approach to the identification, .control and:Communication of

productivity improvements at Department of Labor..

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE: f

#The DOL agency's management information systems dd riot

produce the informatiorr needed to evaluate the .perfOrmanceof

individual employees, nor do the management information systems

produce the unit cost of a major activity, other than travel

:expenses% Only 43 percent ,of the supervisors have individual

,employee production reports. Only 57 percent of the supervisors'

indicated that most ,of their employee'Swork.-is measured. Of

these, less than half 'feel these are afair and

equitable basi; for evaluating indiVidU41 performance. The DOL

lacks a program for improved productivity' managemett. There 4

no uniform approach to measurement. there is no od-ganizational

[CONT'DONNEXT.PArE]

116

289
%or

mechanism to prbvide liasion among agencies, to encourage

management support, or to assist in offefing technical advice

about tare implementation and evaluation of such a systeM.

Consequently', management controls are not being effectively

brought down to an.ihdividA

-ieMplOyee level-and existing output

measures arejiot'usefulfOr erformince appraisal. WitWout

productivity improvement and thereby result in cost savings.

a

11

117'

.o
. PPSSCC ISSUE SUMMARY: INFORMATION

TASK FORCE REPORT: Department of Labor

ISSUE _No./TITLE: LABOR 9: Reducing Unauthorized

Telephone Usage..

DEPARTMENT/PROGRAM: Department of Laor

PAGE REFERENCE [REPORT (R)/APPENDIX (A)):- )72' (R)

, .f THREE-YEAR SAVINGS ($ millions): $3.3 t411

FUNCTION/CATEGORY: Support Services

PROBLEM CLASSIFICATION: Identification

BACKGROUND:

The General Services Administration Office Of

Automated Data and TelecOmmuRications Se vices is

responsible for the provision of the to ephone:systems,

local and bong distance services including The Federal

Telecommunications System (FITS) NetWork, and management

reports on:telephone usage. The FTS was.created for

conducting official gOvernment business at'reduced cost.

'INFORMATION GAP 'PROBLEM/CAUSE/CONSEOUENCE:

Department of Labor estimates Of unauthorized

calling levels range from 10 to 40 percent'.'

The long distance reports available on FATS, provide the I date, calling telephone number, the' called telephoce number, \ time of day and dura0.on"of the call. However, they do not

report calls made before .8:00 a.m. and after 5:00 p.m. since

the reports Were only being'uted to monitor .usage trends and,

not to control costs. It is our understanding. that DOL.

employees are aware that, their calls are not being recorded'

before or after this time frame, which may contribute to

abuse before or after those hours. Consequently, the

reports are not representive of all calls placed over the

FTS network. Therefore, while long distance reports can be

used for trending purposes, the current information does not'

lend itself to use for cost containment purposes.

118

291
/ TASK FORCE RPORT:'. (30) Land/Facilities/Personal Property

'/PP6SCC ISSUE.SUMMARY:- -;INFORMATION GAP

* ISSUE Uo./TITLE: .LAND 2: Federal/ Vehicle Fleet 'Management

-DEP7MENT/PROGRAM:' Government-wide: mostly GSA, DOD, USPS, etc.

PAGE REFERENCE [REPORT JR)/APPENDIX (A)): 14 (Al

THUE-YEAR: SAVINGS ($ millions): $146.1 .(S) (i: Info all)

$ 15.8' (R)

FUNCTION/CATEGORY: Support Services

,PROBLEM CLASSIFICATION: ,Quality

0

BACKGROUND:

The Federal vehicle fleet consists Of 436,000:venicles,..

Mostly automobilds and light trucks, dispersed throughout the

.r.S.1',and an :additional 35,000 located in foreign coantries. The

41eet:is managed throbgh'individually operated motor pools. The

two largest fleets are operated by the Department of, Defense and

the U. is. Postal Service, .with 138,000 and 118,000 vehicles,

respectively. In addition, the Gengrai Services Administration

(esA) controls 90,000 vehicles, ,d1Vided into 101 motor pools, for

the'assignment and use of.other agencies. The annual cost cf

Owni'ng and operating the,Federalfleet was $731 million in FY

1981. Both the size and the cost have .seen growing steadily.:

INFORMATION GAP, PROBLEM /CAUSE /CONSEQUENCE:

Therg,jS\no common or central information system which

tracks the cost of acquisitiOn,,utilization and maintenance and

related costs. Each motor fleet agenCy-operates under its Awn

Acounting and cost system. Although all departments and agencies report tolGSA'annually on the fleet size, type of vehicle,

mileage driven; cost of operation and fuel consumed,,the resultinginformation is of dubious value due to inaccuracies and

inconsistencies. Further,',the costs for capital and other mangy,

agement expense are not collected.

The lack t data or centralized authority is the result of

the'lack pf legal authority to assume managerial responsibility.

'There'is no,motivationor identifying or solving the problems.

As a' result, fl0e Management differs in quality from agency.

td agency and is oete dSplicative, This results in unn _ass

expenditures for tacilitkies, vehicles, and equipment. Ina

information stymies anallis of the Federal fleet, in cen

*ThiS issue wa also covered in the Privatization Task Force

Report' in jss "PRIVATE 7: Federal Vehicle Fleet Management."

'1.19

. 4 292
( FUNCTION/CATEGORY: Program

-PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Low Income Standards & Benefits

ISSUE No./TITLE: LISAB- 4: -Improved Income Verification Through

. . Computer Matching, . : DEPARTMENT/PROGRAM: AFDC, Food-IStareps, SSI, Medicaid, Section 8

Housing

PAGE REFERENCE .REPORT (R)/APPENDIX (A)]: 46 (R)

THREE-YEAR SAVINGS. IS millions): $2,257.8 (S) (I: tnfo all)

PROBLEM CLASSIFICATION: Analysis

BACKGROUND:

The Social'Security Adm-inistration, Departments.of Health

and Human ServiCes Agriculture, and Labor, Internal Revenue

Service'and Office of Personnel Management all maintain income

records or adM,iniscerone or more needs-based programs. The

Office of Management and Budget is responsible for overseeion

these agencies in the administration of these programs. Federal

regulations require that programs Verify recipient income in

some, but-not all, of the programs,Apnd the'procedures are not

strictly specified., These programs Cost the Government $48,780

million in 'Fl 1982.

. . . INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

Present data sources are neither centralized nor. consistent

dn.avallability. Managers acre often required to verify applicants' income through Manual means, having no access to an auto-.

mated system. When data is complete, it is often 20 months old. . thi 'bleM- is due, .in some instances, to the fact that

Federal legislationinhibits the implementation. of automated

verification systems and in particular the use of tax return

data. In Other ca4e44 lack of affirmative legislation causes

states and Federal agencies to restrict or prohibit the use- of

relevant, available- data.

As a result, 6.3 percent of the total Federal and staro:

benefit payments for these five programs result in overpayments.

.USing 1,82 data, this amounts to $4.1 billion in expected overpayments.-

4

120 gs 3
PPSSC ISSUE-SUMMARY: INFORMATION GAP 1 TASK FORCE REPORT: Low income Staiodards & Benefits

ISSUE No/TITLE: LISAB-5: Federal Incentiv'e Program ,for Automation of State Welfare Data' . DEPARTMENT/PROGRAM: USDA (Food Stamps), HHS (AFDC), HCFA

(Medicaid)

PAGE REFERENCE LREPORT (R) /APPENDIX (A)l:. 56 (R)

THREE -YEAR SAVINGS (S (S) I:, Info

FUNCTION /CATEGORY: Identification

PROBLEM' CLASSIFICATION: Quality

BACKGROUND:

The administratian of AFDC, Medicaid, and.Food Stamps

requires theassembly and Maintena-nce of information'on.applicants and recipients'. The staff determines eligibility and enti-'

tlementsbaSed:on t .data. These three programs cost $36,962

million to adminis er and made payments to 44.3 million

individuals in 'F '82. , , -INFOR 0 PROBLEM/CAUSE/CONSEQUENCE:

There is no centralized data base to determine eligibility

for public assistance for these programs. Income and asset

informatiOn is not uniformly defined, and there'are separately -

formatted appliCaion forms .for each program. Recoraleping is

not well-organized. Verification of information, needsdearMiLltion,-notiO0 and check-processing, reporting reauiremeWs,lOW6 references to benefits from other programs, are often

performed manually.

While'Federal ihaentives exist for 3.i..,ates to automate welfare data in the form of higher matching sates for start-up costs

and operating costs of automation efforts, each agency has its

level of reimbursement authorized by se arate legislation.

Previous proposals to standardize, cent ',A6 lize, and integrate the

programs have met heavy objection from COngress and special

interest groups. . , As a result of the current method of operatiori, there are

duplicate and erroneous payments made ta benefidiaries, alnd

,. extensive staff time is being spent'on separate programs that

regwire examination of the same'or similar data and interview

procedures.

121

294
. . PPSSCC ISSUE SUMMARY: INFORMATION GAF -

/

TASK .FORCE REPORT: Low Income Standards & BeXeffts

ISSUE No. /TITLE: LISAB Supplemental.Security. Income Program

DEPARTMENT/PROGRAM:. SSA f

, .PAGE REFERENCE (REPORT (R)/APPENDIX.(A)]: 71 (R)

THREE -YEAR SAYINGS CS millions): $797.,7 (S) Info plus)

FUNCTION/CATEGORY! Progcam

PROBLEM CLASSIFICkTIOU:. Quality

BACI(GROUND:

Under the SSI prOgram,-eac h e ligible aged or disabled person

(old age,- blind, permanently and tOtallY disabled) living.in hig/

her.fOwn household i provided a monthly cash payment 'that is sufficient, when added to countable income, to bring tdtal monthly

income up to °a specified level. The Federal monthly payment

&Mount is determined by deducting countable income, after exclusions from the applicable-guarinteed levels` (e.g.! Social. Security or other earned income). The cost of'the progEam-in F '82

Was $9.8 billion.

INFORMATION GAP PROBLEM:/CAUSE/CONSE0 CE::

To achieve its goal, SSA relies to a great degree on the

recipient population or a representative payee reporting in a

timely fashion information regarding any change in circumstances

which may affect either the amount of payment.or the continuation

of eligibility for payments.

This program's eligibility criteria bnd precise benefit formula,calculates an exact benefit for each recipient based on

individual circumswces, creating a .remendous administrativt

burden, and, great *eliance on recipients to report accurate data

on time.

- As a result, thpre are overpayments, requirements-to repay,

.or loss of payments to recipients. The annual. redetermination

process'has notteen effective in. reducing its error rates.

Nearly half of the excess payments should have been determined

butwere not.

1'22

295

4--
PPSSCC ISSUE SLMMARY: INFORMATION GAP

_TASK FORCE REPORT:, tow Income Standards & Benefits

. - ISSUE No./TITLE: .LISAB 9: Medicaid Quality, Control

DEPARTMENT/PROGRAM: Medicaid Quality Contrdl

PAGE REFERENCi (REPORT (R)/APPENDIX (A)):- 99 (R)

THREE-YEAR SAYINGS ($ NQ

FUNCTION /CATEGORY: Program

PROBLEM CLASSIFICATION: Analysis(

.BACKGROUND:

Medicaid is a joint114 lunded Federal and state program to

pay for medical care for the poor. The Federal, Government mandates a basic set of_benefits, while states. may covert an addi-.

tional, optional set of Services for which Federal matching funds

, are available.' Medicaid Quality Control is a state-operated

management system designed to reduce or eliminate eiliwoncous payments. Progress is.theasured and validated by HCFA.

INFORMATION GAP PROBLEM /CAUSE /CONSEQUENCE:

r There is a'total time lapse of six months between the

monthly sampling of cases for case,eligibility identification and

the determination of the dollar amount of services; erroneously

provided.

This proCedure is thought to provide time.to submit claims

for services rendered during the sample month and fbr the states

to process their claims.

As a result, this unnecessarily delays the-flow of informa-7

tion to aid in the error. identification process and therefore

delays corrective action. The error rate in FY '81 was 4 per -b

cent, which cost $1.3 billion.

6t

123

296
r

PPSSCC,ISSUE SUMMARY: INFORMATION GAP

I ,'ASK FORCE REPORT: department of the Nayy

ISSUE No./TITLE: NAVY 8: .'Supply/Inventory Management

DEPARTMENT/PRdGRAM: Navy

:t

PAGE.REFERENCE DEPORT (R)/APPENDIX (A)]: 107

'THREE-YEAR SAVINGS ($ millions): $200.0 (S)

FUNCTION/CATEGORY: Materiel

PROBLEM CLASSIFIOATION: ADP

BACKGROUND:

The Navy has two inventory control points for ship parts and

aviation supplies.which'employ 5,400 civilians and 160 military,

staff. Together thy handle over $2 billion in annual purchases

nearly 200,000 procurement actions per year. Stowed in many

of the more than 3 supply rooms on a carrier are.over 80,000

Live items of ship and aviation parts, with a value exceeding

$125 million. These items as well as other suppliies (totaling

approximately 300,000 line items) are managed by the ship's

4 Supply' Department personnel-. There are six Navy supply centers

containing mare. than 2 million line items with a value of over $5

billion in warehouse facilities. The work'force at therUpply

Centers numbers approximately 9,000. .t INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

The Naval supply -system is operating with inaccurate

inventory tecords, unreliable management information, and

atiquated, fragile, punched card and batch prccessing'automated

equipment, which its costly to operate and does not permit user

interaction.

A managerial problem stems from the practice of assigning

inexperienced offices to supply centers as'well as the lack of a

cohesive' program. To achieve management efficiency the Navy has

inadequate accountability and inventory,controls.

I As a result the current priocedures are error pr e,'

encourage costly omissions and-do not enable the sophisticated

analysis heeded,fortoday's high-failure/high-risk

decision-making. Inventory losses are excessive ($13 million in

FY 1980 and $330'million in FY 1981).

124 297
,PPSSCC ISSU SUMMARY: INFORMATION. GAP

TASK 'FORCE REPORT: Department of the Navy

assut No./TITLE: NAVY 13: Aircraft Powerplant Maintenance

Management

DEPARTMENT /PROGRAM: Navy: Maintenance Management, Planning and

Scheduling

PAGE REFERENCE [REPORT (R)/APPENDIX (A)): 149

THREE-YEAR SAVINGS ($ millions): NQ

FUNCTION/CATEGORY: Personnel

PROBLEM CLASSIFICATION:. Quality

BACKGROUND:

The maintenance of the Naval'Aircraft Powerplant at the

depot level was found by theL PPSS Task Force not to conform with

the state-of-the-art for similar activities' in' the air trapsport

industry, and the maintenance management practices and prokesses

were found not to be as effective as the industry's practice.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

Program managers do not have dailyshop performance data,

i.e., manhours by engin/work center, material usage, .etc.' The

present system of provichng this essential information on a

weekly basis is inadequate to promote efficiency and improve cost

control. Identifying deficiencies and assessing accountability

becomes pratically impossible. In the accessory maintenance

management area, approxibately 50 percent of all components

received have no documentation-identifying reasons for removal or

time since last overhaul. The Navys data. ,collection system is a

minimum of 90 days behind in posting commponent removal

statistics: The lack of adequate component removal information

dictates that the.affeoted components be automatically

overhauled. The cost of'overhauf-versus isolated repair

requirements is obiviously an unnecessary expenditure.. Further,

an engine monitoring system, which is a necessary source of

information to manage engine removals and to support increases in

scheduled maintenance tasks, was not in use.

The problems are largely att ibuted to the organization

-where militarS, management is super mposed otter the civilian

organization but exercises limited control or direction over

processes. Program managers often do not have theauthority to

125

298
. initiate appropfiate action.'. There is -a notable Lack of

effective input, of all-responsible. departments in the woek ' , planning- process. There are no -checks and balances exer'c'ised

over- decisions- -made by estimators and eiraivaifors and cokt and JNturn 7aroundltime results Sre 'not-a consideration.

. Warebulilt;,the work forces are not functioning together to ..

reach' efficienty. .goals, cost savings; or impro'Ved world methods. ,- th_generalsprAdtiCes and;processes are ineffective and -.

inefficient: ,(7 -!..,

1 IL:RI ; '

.,, .

4

ry 126:

299

I
PPSSCC ISSUE SUMMARY: INFORMATION GAP.

TASK FORCE REpORT:'.Dtpartmeht of the Navy

ISSU'E.No./TITLE% NAVY 13: =Aircraft Powerplant Maintenance

Management

DEPARTMENT/PROGRAM: Navy/Aircraft Powerpland §upply 8uppoxt.

PAGE REFERENCE [REPORT (R )` /APPENDIX (it):

(THREE -YEAR-SAVINGS (4 millions): (S)

FUNCTION/CATEGORY:' Facilities

PROBLEM CLASSIFICATION: ADP

BACKGROUND:

The maintenance of the. Naval Aircraft Powerplentat-the

depolp.1 .level, was found by the PPSS-Task'Force not to conform. with

the.state-rof-the-art for sioAlaractivities in the air transport'

indUstry, and themaintenahce management precticesanprocesses"

were found not, to be effective as the indUsth's. .

149

4

INFORMATION GAP PROBLEM /CAUSE /CONSEQUENCE:

The inventory control system for components' does not

routinely review excess_and obsOlete material. 9uality'deficient

_co"Mponents which are fOuhd not-to meet receiving inspection

'standards and installation rectuireMents are set aside without a

fesponsive record tracking systeM: The component /material

qudttioh'is'stored and remains in a "black hole" for

..approximately 120 days. FuttAer, di'position instructions from

the-Aviation Sdpply -Office., repair vendors; and Navy Supply

Centers are received on anerratic,basis.

-These OrobleMsstemm from the organilational difficulties

and .management structure' which limits communications, and

cooperation.

As the result or the lack o"finventory controls, -parts and

materials are carried in excess of planned usage, thus utilizing

purchasedollars.end storage Space.that, coule be more

berOeficially used .for other important procurement.

.
5,4 PPSSCC ISSUE SUMMARY: INFORMATION GAP

, TASK FORCE REPORT: Department of the Navy,

-ISSUE No./TITLE: NAVY 15: Cash Deposits

DEPARTMENT/PROGR(AM: Navy Finance Centers

PAGE REFERENCE [REPORT (R) /APPENDIX (A)]: 159

THREE-YEAR SAVIisiGS.('$ millions): $10.0 IS) (I: INFO ALL)

FUNCTION/CATEGORY: Financial

PROBLEM CLASSIFICATION: ADP

BACKGROUND:

CaSh is received- and depos.ited by Navy Finance Centers. The

amount of mohey received month :y appears to be substantial.

Estimates range from approximately $400 million to over %500

million per month.

.INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:.

dz.:4 The Navy does not have the adequate accounting systems and

practices necessary to assure fully accurate information on the

Source and.affount of all monies received.. Navy .funds are often.

not deposited on the day received. Typically they are" held until

the required accounting can be;completed. In come cases this

takes several days to accomplish.

Receiving and holding. checks until the accounting can be

completed results in the risk of a loss of the check prior to

deposit and a cost to the Government in the form of additional

borrowing.

128'

301
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPOR*I: Personnel Management

ISSUE No./TITLE: PER 14:. Duplication of Supervi-sory

Training

DEPARTMENT /PROGRAM: OPM

PAGE REFERENCETREPORT (R)/APPENDIX (A)]: 170 (R)

.THREE -YEAR SAVINGS ($ millions): $66.2

FUNCTION/CATEGORY: Personnel

PROBLEM CLASSIFICATION: ,Identification

BACKGROUND:

4

The law.does not specifically authorize OPM to prescribe the

types and methods of intra-agency training or to regulate the

details of intra-agency training program's. It does,. however,

authorize the issuance of regulations containing the standards

and principles under which intra-agency training programs are to

operate. As a result, agencies are duplicating efforts in the

design, development, and delivery of generic supervisory and

management leVeltraining programs. Many of.these programs are

very similiar in course content and training approaches both

among agencies and between agencies and OPM.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

No one in The-Federal Government knows much in total is

being spent on. training. The_reason is that training costs are

not adequately recorded and little systematic budget collection

is undertaken. Each agency.makes its own decision whether or not

to collect training- costs data. Without this di.ta, evaluation

and improvement in the area of training is all but impossible.

r 129

302:
PPS.SCC ISSUE.SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Pergonnel Management.

ISSUE-No./TITLE: PER 18: Workforce Planning

DEPARTMENT/PROGRAM: OPM::andOMB

PAGE REFERENCE CREPORT.'(R)1APPENDIX (A)1: g'19,4 (R)

THREE-YEAR SAVINGS (5 millions): NQ

FUNCTION/CATEGORY: Personnel

PROBLEM CLASSIFICATION: Identification

BACKGROUND:

The'Federal.workforce (Executive agencies except the

Postal Service) consists of more than 2 million eMploYees'

receiving direct compensation of over $66 billitm ag Of 1983.

The U.S. Office of Personnel Management ,(OPM) is an independent

agency overseeing the execution and administration of laws,

rules, and regulations governing the Civil Service. rOPM has a

staff of about- 5,000 and an operating budget of $157' million.

1 INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

Information regarding agency workforce needs is limited .in

its credibility.. Present emphasis is on personnel ceil1ings

(headcount) cantrol rather than human resource planning and its

relation to budget dollar control.'.

TSe'limited capability bf the agencies to prOvide reliable

information on their workforce needs to the Administration and

Congress is the result of the absence of a uniforM workforce

planning system.. ThoUgh OPM'and the, Office of Management and

Budget recognize the problem, no real organized initiatives have.

encouraged the agencies to better plan their workforce needs.

As a result, sound decision making on human resource programs and policies is'limited. With the cost of salary, and

fringe benefits for Federal employees at $90 billion in 1981,'a

functional workforce planning program should 'result in cost

- reductions resulting from_ better use 'of human resources.

0

kb 130

4
r. 411

PPSSCC ISSUE SUMMARY: IN ORMATIOU GAP

TASK FORCE REPORT:. Personnel Management

ISSUE No./TITLE: Issue for Further:Study 2: Compenbation and

Benefit Costs for the Civilian Workforce of the

Executive Branch

DEPARTMENT/PROGRAM: -Government-wide

t PAGE REFERtNCE [REPORT (R)/APPENDIX (A)]: 224 (R)

THREE YEAR SAVINGS (S pillions): NQ

Fr UNCTION /CATEGORY: Personnel,

PROBLECLASSIFICATIoN: Quality

BACKGi7e9U,ND:

lin'FY 1982,*Aitotal Federal civilian employment (excluding t_ i-.77::,,ty,..the'Postal ServiCk),ls approximately 2.1 million with .*'' salary . i

,

. - 's costs-of $63.67N.11A'o ',. ,In FY 1981, agencies recognized total

ComPensation'cot 114;31 to 127.8Z percent' of gross Tayroil4 al.-..7 tkOughvtpaymenes:f omr*41,1 Government sources. were 165.28 percent

'. ',..,:

, 't,. , *-, TIONQAP ROBLEM/CAUSE/CONSEQUENCE:

4 \ ; Z : ''' 0

l', 1Agenci' _use inaccurate information as the basis for detet-

, . a *i.A.1,ng omnel costs. Costs are generally understated, due to

!' \ ,- the lack of .1. 0-e iof. a comprehensive and standard definition for

-

. . ,.. 0. yee be!* is ,

-r40Q10A2,,the information provided to deciion-makers has

d4sempact on budget matters, the direction of man=

tIon,,the analysis of increasing costs', c:icisions

7:- -tig out, and cost comparisons to the private

131 , 304
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Privatization

ISSUE No%/TriLE: PRIVATE 5: Commissary Operations

DEPARTMENT/PROGRAM: DOD , PAGE REFERENCE (REPORT (WAPPENDIX (A)): 129 (R)

THREE-YEAR SAVINGS' ($ millions): $2,064.0 (S), $3834, (R)

FUNCTION/CATEGORY: Financial

. PROBLEM CLASSIFICAIQN: Quality

BACKGROUND:

DoD operates a. world-wide commissary SystOM which has -358

,stores, 24,772 employees, and annual sales of more than $4.2

INFORMATION GAP PROBLEM /CAUSE /CONSEQUENCE:

Actual operating costs of the commissary system are

difficult to compute because a nu r .of indirect costs are

not charged;to the system. These reported or "hidden" costs

are generally paid' from funds appr riated for the operation of

the base or support organization at which-the commissary store is

located. These hidden costs include maintenance of personnel

files, procurement services., contract negotiation, computer

operations, garbage collection, autovon

telephones, and motor Extols.

132.

3;05
PPSSCC ISSUE SUMMARY: OFORMATON GAP:

TASK FORCE REPORT: Privatization

ISSUE Nb./TITLE: PRIVATE 7: Federal, Vehice Fleet Management

DEPARTMENT/PROGRAM: .Governmentl-Wide I PAGE REFERENCE [REPORT (5)/APPENDIX (A)J: 164 (R)

THREE-YEAR SAVINGS ($ millions): $399.8 (S)

FUNCTION/CATEGORY: Support Services

PROBLEM CLASSIFICATION: 'Quality

BACKGROUND: 4

The Federal Government operatesapproximately....436,000 motor

vehicles at a cost in e(cess of $1 billion annually.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:'

OVerall cost and utilization data are ,not centrally

available to permit accurate evaluation of total fleet or -lt'ions

and costs.

For exampl- vehicle years of operations statistics indicate

tha,_ it 1000 ve,1.les are available for operation only ten month's

of the year, then ten-twelfths of 1000 or 833.3 vehicle years of

operation are reported.

The number of vehicle years will be equal to or les's than

the number of vehicles in the fleet. -Thus, any comparison of

miles per vehicle year will overstate total fleet utilization.

This misleading statistical comparison results in higher

,appropriations than n for maintenance and acquisition costs.

133,

306
PPSSCC ISSUE SUMM4FY: INFORMATION GAP:

TASK FORCE REPORT: Produrement

ISSUE No./TITLE: PROG 8t Cost. Estimating and Scheduling

DEPARTMENT/PROGRAM: OOD

PAGE REFERENCE [REPORT (R) /APPENDIX (A)]: 57 (R)

THREE-YEAR SAVINGS ($ millions): $2,940.0 (S)

FUNCTION /CATEGORY:` Financial

PROBLEM CLASSIFICATION: Quality.

( BACKGROUND:

Cost estimates and schedules for major weapons system are of

dubious accuracy. The March 1982 DoD Selected Acquisition Report

cost summary on 42 major weapons-systems acquisition programs

showed an average cost overrun'of about 150.7 percen' fro, thf

Milestone II (Pro-gram Go-Ahead) estim -es for the programs.

INFORMATION GAP PROBLEM /CAUSE /CONSEQUENCE:

The consequences of inaccurate estimates are program

instability and reprogramming, as well as loss of credibility

with the Congress, media, and public.,

Our source of inaccurate estimates is the contingency, or

.management reserve, which is not st&own as a line item in

estimates. Program estimates typically contain management

reserve which DOD feels is necessary to allow for estimating

error and for risks to the program and technica'l changes which

are undefined but experience has shown will take place.

This reserve is buried in various parts of the estimate and

not identified on a line item for fear that it will be considered

"fat" and eliminated during the budgeting process.

This practice leads to misleading estimates and hampers

efforts at cost control.

O

134

307
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Procurement

ISSUE No. /TITLE: 'PROC 10: Economic Order Quantity System

DEPARTMENT/PROGRAM: DOD, GSA/ESS 1 PAGE REFERENCE [REPORT (R)/APPENDIX (A)]:

THREE-YEAR SAVINGS ($ million): $4,540.0 (S)

FUNCTION /CATEGORY: Materiel

PROBLEM CLASSIFICATION: ADP

:CKGROUND:

The value of the repairable and consumable inventories in

the Government is approximately 40 billion.

INFORMATION,GAP PROBLEM/CAUSE/CONSEQUENCE:

Purchasing costs and inventory carrying costs are not

adjusted regularly to correct and current levels.\

The accuracy, of demand forecasting is poor due to,a lack of

reliable data and the inability of computer systems to handle

modern forecasting methods.

These,problems result in excessive'inventory levels and,

therefore,`' higher costs to the Government,
PPSSCC ISSUE SUMMARY:. INFORMATION GAP

, TASK FORCE EPORT: Procurement

ISSUE No./TITLE: PROC 12: Physical Inventohr Taking

DEPATMENT/iROGRAM: DOD,

PAGE REFERENCE [REPORT 00)APPENDIX (A)): 82-83 (R)

THREE-YEAR SAYINGS' ($ millions): .,NQ

FUNCTION/QATEGORt: Material

PROBLEM C.ASSIFICATION: Quality

BACKGROUND:

. .4 I Each Military likimp and the Defense Logistics Agency are

.responsible for takibg periodic" physical inventories of the $40

billion worth of goods in tt%e DOD supply system.

'?

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

DOD does not utilize'therpreferred'private sector syse of

inventories, called "Wall to(Wall." Thus, the quantity cour may

be:inadvertantly misstated during th4,inventory process.

136

309
P?SiCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Procurement

. ISSUE No./TITLE: PROC19: C sideration of Contract Performance

In Making Procurement Awards

DEPARTMENT /PROGRAM: Government-Wide

PAGE REFERENCE [REPORT (R)/APPENDIXAA1]: 120 (R)

THREE-YEAR SAVINGS ($

FUNCTION/CATEGORY: Materiel

PROBLEM CLASSIFICATION: Identifibation

$97.0 (S)

BACKGROUND:

Repeat business with utsatisfactory, vendbrs is termed a

significant problem by procurement and contract management

personnel.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:.

611, The probl of repeat business over time is compounded by a.

failure to use Government-Wide (or even agency-wide) performande !!1_61' data. Contractor's with poor performa'nce records in one agency -

sometimes even vendors that have been suspended - may be

awarded contract's." by,. other agencies. N

Basically, there is a lack of adequate storage and

accessAbility to vendor experience data'.

137

310
PPSSCC ISSUE SUMMARY: INFORMATION\GAP

TASKORCE REPORT : -. Real Property Management

"ISSUE No./TITLE: PROP 1: Improved Management Focus and

TeChni4ue,

DEPARTMENT/PROGRAV :Government-wide/GSA and DOD Management

PAGE REFERENCE [REPORT (R)- /APPENDIX -(A)]: 9 (R)

THREE-YEAR SAVIN ($ (S) Info all)

FUNCTION/CATEGORY: Facilities

PROBLEM CLASSIFICATION: Identification

BACKGROUND:

In 1980, it was reported that the Federal Government owned

744 million acres valued at $104 billion, of which $42 billion

was in buildings, $52 in structures, and $10 billion in

land. The Task Force concerned itself only with buildings and

military bases. The General Services Administration's (GSA)

Public Building Service (PBS) is responsible for acquiring,'

operating and maintaining real properties and gdneral officefacilities for most of the-departments and agencies of the U.S.

Government, while, DOD manages Government military bases.

1

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

There.is a lack of internally generated, reliable management

information on space assignments, intensity of space utilization,'

vacancy-rates, and rental rates for GSA-controlled space. There . is a lack of cooperation between tenant agencies and GSA/PBS.

Appropriate computer systeMs to maintain the above information'

effectively are also lacking.

This is due to the'absence of an overall mission in managing

the real property of the Federal Government. Without a clear and

concise goal, policy execution, delineation of responsibilities,

and performance monitoring cannot be carried out efficiently.

As a result, GSA cannot effectively manage Government -owned

buildings since it has no way of establishing how much space is

available for occupancy.

138

311
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT:' Real Property Management

ISSUE No./TITLE: PROP 2: Meeting Office-Space Utilization Goals

DiARTMENT/PROGRAM: Government-wide, Managed by GSA

PAGE REFERENCE [REPORT (R) /APPENDIX (k)]: 22 (R)

THREB.-YEAR SAVINGS ($ millions): $234.4 (S) (I: Info all)

FUNGTION /CATEGORY: Facilities

PROBLEM CLASSIFICATION: Identification

-BACKGROUND:

Federal agencies and departments occupying space in buildings managed by the General Services Administration (GSA) pay

user charges based on comparable commeicial rates. These

payments provide a fund for financing GSA's'acquisition and

operation of Government-owned and leased buildings: The systeM

of .assessing space-charges against each Federsij 'agency is about

-,10 years old. Federal space*utilization has 'cpt improved significantly* in the last five years.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

Until recently, the Office of Management and Budget (OMB)

required each Federal agency to include full dhta on personnel

space utilization in its budget presentations, but this submission is now voluntary. GSA is supposed to perform periodic

space utilization surveys and inspections, but recent reports by

the General Accounting Office and the Office of the Inspector

General indicate that these surveys are not taking place on any

regular basis. In addition, the information available to GSA on

space-utilization is said to contain numerous inaccuracies.

This is due to the fact that OMB has made voluntary the full

submission, of space utilization data and that agencies do not set

specific targets regarding allotment of office space per employee

by location.

As a result, incentives for improving space utilization have

decreased as have planning capabilities. Where space surveys are

being performed, they are not being used to their fullest possible potential.

139

312.
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Real Property Management /'

ISSUE No./TITLE: PROP 6: Making In-House Maintenance More

Productive-

.- c, DEPARTMENT/pROGR6: Go entrwide (mostly DOD & .GSA)

PAGE WERENCE ['REPORT (R) /APPENDIX (i): 58 (R)

,THREE-YEAR SAVINGS ($ millions): ,$1,125.4 (S) (III: Info

04

FUNCTION/CATEGORY:-

PROBLEM CLASSIFICATION: ;.cp4§,

d

;

. 4? 4 BACKGROUND:

.plus)

. The 'real 'prqpe"kr4.ifq. nice blidget fo? the :Federal Government in f..y458/343,At4A4AAn. Governmentwide.productivity in

carrying out -in- ,house aintence is .onty 40-:45 percent. Any -

thing less OVever, is below the now" range by

private sector `standards; tpriyate sector usually achieves°

60-65 percent productiyitythls area. There is ,generally poor

planning, estimating `and scleuling.and lack of incentives.

INFORMATION GAP PRMAMititOtONSEQUENCE:

'4;101 InfOrmation on,HperfaNtail,de is lacking. Performance indices

are not ca,lcu.late.AB brought to the attention of 'managers.

Thoughan Engi-neered Performance Standard (EPS) system is now in

place,, it is too complex dna:is not, in practice, ,applied to

dbproVing: maintenance produCtivty'._ Simplification of the use of

the informationnow%coltCted, and heightened awareness of the

.would improve the situat,ion.

There is a lack of motiviOn and incentives for-managers to

improve pc5dUctivity, si41ceneither rewards nor penalties are

associated with theirciOS.: , As a' r'e'sult, OrodUctivity 'could be better monitored and

improved, :tArOuh,a better syst,em for Collecting, reporting, and

utilizini-te data sampled, A

n1

. 41,:,W.,,,.t ,

o"+, 2V:A 114

140

313

1
P116 ISSUE sOmi4ARyi: INF

. eal:Property Manag'eMent'

ieduc:ing EneriitsCoSts An

rC 1 DEPARTMENT/PROGRAM: GSA,and DOD

PAGE REFERENCE [ROOM (-R) /APPENDIX (Al]: 63 (R)

THREE-YEAR SAVINGS .($ millions): 5385.1 CS) (I: Info all)

q0VernMen.

FUNCTION/CATEGORY.: Facilities

' A FROBLEM CLAiSt'ICATION: Identificatibn

BACKGROUND:.

ouring,Ff'1983;:tne Generail.SerViCes AdministratiOn (GSA) . expects to pay out aPptdiAmately5300 million'Wutility and fuel

$225 million te in direct payments from its

owmpudgetsyand-therest:will be- in reimbursements by tenants.

Forty percent. of GSA'utilitye-xpenditures-are in.the National

CePital-, Region (NCR)'.'.In FY 1982, electric bills were 65 per.

cent,.and.steambills for space heat were 29 percent of all

energy costs.. The total utility budget for the:Arm, Ni'vy, and

r. Air Force fo FY .1983 is S2.56 Million.

INFORMATION GAP'PROBL4M/CAUSE/CONSEQUENCE:

In thefive-plaritc,syStem thet provides steam for GSA 's

fuel-inatit and operatinillkatiscics are not maintained for indi2idual:unittand date is-npt.available for thaNpurpose of making

conomec analyses of the system:on.a continuous basis Quent"ty ;.

and quality of fuel 'inputs, reliability statistics, steam o put

,data,-and steam delivery to each building are not collecte

, GSA. has nW Enetgy Mahagement Control System.(_EMCS), whicti , - the-private sector:uses widely.. Such Anelectronic data . . processing systeM menage's the.energy resources for a building .o.t

a ,complex._-: An EMCS Would. monitor colledt andl,rodess data such

es tempetetures, equipment. states, .and the rateof energy con-

.sumption and.wOdld display it at a central location. From this

so infomation?, evaluation 'of current operatiCns as'yell,'es'alter-

'natives can be-rconStdered,-to determine optimum 40eration-.:

. Much of these GSAI-.releed-problems are,due:bo the,; fact that

its current, management views its tole -strictly ds,:being-reSponsi

ble for "keeping the heat on" in-the NCR-4. ,,

f,!

.(C- ONTINUEU.ON NEXTPAGE)

rt
PPSSCC-ISSUE SUMMARY: INFORMATION GAP (CONT'D)

As result, cost control is not a high priority. Exceis

pacity exists and utilization is not optimized. Economic analy es and planning for Federal utilities and personnel to operate

em thus become difficult, if not _impossible, tasks.

1,9

u '

142

315:

4

y.
PPSSCC. ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Real Property Management

ISSUE No./TITLE: PROP 4: Revision-Of,GSA'sPor).1Pies and ProceduresRegarding Leash and AOgbisition

DEPARTMENT/PROGRAM: GSA

PAGE REFERENCE [REPORT (R)/APPENDIX (A)J: 83 (k)

THREE-YEAR SAVINGS ($ millions): $144.5-(S)-(1II: Info plui-)

FUNCTION/CATEGORY: Financial

: PRipaEM.CLASSIFICATION: StructureBACKGROUND:

The General Services Administration (GSA) has extensive

authority to obtain office space by lease. As of September 30,

1982, GSA leases included approximately; million square,feeti

housing approximately 400,000 Federal employees. Associated

costs for FY 1983 were $770 million, and this figure is expected

to reach $1 bill -ion by FY 1985.

INFORMATION OAP PROBLEM/CAUSE/CONSEQUENCE:

0.

GSA's-pubiib-a-CiOn-Of-summary InTormat on on leasing is slow,

and as much:as half of what it reports abdmt space occupancy by

various agencies may be inaccurate. The data published by GSA

andpresented to Congiess does not agree with GSA's Public Building Service Mdhagement plans and is therefore" highly unreliable.

This is due to the fact that GSA's performance in leasing

space to satisfy GOvernment agencies! needs is bound closely by

its own regulation's, and also by Congressional and Exeoutive

requirements, which produce delays and higher costs in many ways.

The high turnover rate among GSA's realty specialists is thought

to hamper collection of timely and accurateinformation.

As a result of such information inadequacies, GSA is unable

to effectively manage its leases-andLacquisitions:
1.

PPSSCC ISSUE SUMMARY: INFORMATION

TASK ,FORCE REPORT: Research and Development

ISSUE No./TITLE:. R&D 6: Research Program Reporting

-DEPARTMENT/PROGRAM: GOvernment-wide

PAGE REFERENCE [REPORT (R)/APPENDIX (A)]: 109 (R)

,THREE-YEAR SAVINGS (5 millions): $225.5 (S)

4 FUNCTION/CATEGORY: Support Services

'PROBLEM CLASSIFICATION:' Identification

BACKGROUND:

It is estimated that in FY 1983 the Federal Government will

spend $43.0 billion on R&D projects conducted by the, Federal

GOVernment, industrial firms,-univerbities and colleges and

nonprofit institutions (excluding $1.3 billion expenditures on

R&D-facilities). Numerous areas of R&D involve more than one

agency or multiple subdivisions of a single agency. For example,

there; ace 22 independent agencies and Executive agency

.subdivisions involved in chemistry-related research at a funding

-1,ev-04-ct--$531-8-Mill-ialm-for FY 19.62,

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

Currently, there is no central data base capable of

providing ready access to all unclassified, new, ongoing,

and completed Federally funded R &D._ The.National Technical

Information Service (NTIS). data base currently dohs not contain

records of ongoing Federally funded R&D and only limited records

of such Projects are expected to be available through commercial

vendors in the foreseeable future. In addition, the NTIS.data

'babe of completed R&D projectt-is not comprehensive. A GAO

survey of Federal agencies revealed that only 64 percent of the

respondent agencies sbbmitted,,completed R&D prOject,reports to

the NTIS data base.

It is currently not possible for an agency to recover

information formally and comprehensively from programs of other

agencies until Publications are made. , Some agencies, ,such as

DOD, .do not make R&D project information publicly available for

reasons of nattional security. In otherst4 publication usually

takes a year or more.' -.

11 144'

317
INFORMATION GAP (R&D 6 CONT'D).

10. Some agencies, such as DOD's Defense Technical Information

Center and the Environmental Protection Agency's Office of Toxic

Integration, maintain their own R&D project information data

bases. However, these ate only agencyl-specific systems without.

interface to other Agency and NTIS data bases. 7 Federal Government 'research managers are concerned that

there_is no central source of information from which knowledge

ained durin reviousl conducted, Federalt funded ro rams is.4

available. As a result, new projects-are often starteq in

various agencies without the benefit of experience gained in

similar studies conducted elsewhere.

145

318
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Depasplent of State

ISSUE No. /TITLE: STATE 3: Office of.Foreign Buildings

DEPARTMENT/PROGRAM: Office of Foreign Buildings (FBO)

PAGE REFERENCE [REPORT (R)/APPENDIX (A)]: 33 (71-

THREE-YEAR SAVINGS ($ NQ

FUNCTION/CATEGORY: Identification

PROBLEM CLASSIFICATION: ADP

BACKGROUND:.

FBO is reiponsible for the acquisition, maintenance, and

disposal of real prbperty holdings, and leases in excess of ten

years, fOr U.S. diplomatic and consular posts throughout the

world.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

FBO does not have a comprehensive'real property management

information system. FBO's inventory of property holdings is not

complete, and there is no accurate inventory of furniture and

furnishings at U.S. diplomatic and consular posts.

The absence of a'cOmplete information data base limits

management's capacity to make informed, critical decisions

relating to:

o lease versus purchase alternatives;

o preparation of an efficient maintenance

program; I . 44

o timely identification of cost overruns;

o costing savings due to construction

redesign;

o monitoring achievement of construction

milestones;

o "red. - .flagging" potential construction

delay; and

o justification of budget'appeopritions.

146

319
PPSSCC ISSUE SUMMARY:, INFORMATION GAP

TASK FORCE REPORT: Department of State

ISSUE No./TITLE: STATE,: Office of Foreign Buildings

DEPARiTMENT/PROGRAM: Office of Foreign Buildings (FBO)

PAGE REFERENCE [REPORT (R)/APPENDIX (A)]: 33 (R)

THREE YE-AR SAVINGS ($ mil ions): NQ

FUNCTION/CATEGORY: Materiel

PROBLEM CLASSIFICATION: Quality

.BACKGROUND:

FB0 is responsible for the acquisition, maintenance, and

disposal of real property holdings, and leases in excess of ten

years, for U.S. diplomatic and consular posts throughout the

world.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

The present financial management system does not ptovide the

necessary financial information to identify all costs associated

with the operations of individual buildings.

FBO is unable to compile the aggregate information for all

buildings as well. Thus; FBO bases its budgetary decisions upon

incomplete facts.

147

of

320
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK 'FORCE REPORT: Department of State

ISSUE No./TITLE:. STATE 4: Purchase of- Foreign Currencies

DEPARTMENT/PROGRAM: Department -wide

PAGE REFERENCE [REPORT (R)/APPENDIX (A)]: 41 (R)

THREE-YEAR SAVINGS (S millions): $17.1 (S)

FUNCTION/CATEGORY: Identification

PROBLEM CLASSIFICATION: Quality

BACKGROUND:

The United States buys foreign currencies for payment of

operating expenses in other countries, including salaries of

foreign nationals, contractual services, rent; supplies, and

travel. DOS foreign currency disbursements totaled approximately

$488 million in FY 1982.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

No 'system exists for forecasting and reporting foreign

currency expenditures. There is no systetof gathering data on

foreign currency expenditures and matching them with the budgeted

information to determine the effects of foreign currency

fluctuations.

Thus, DOS will experiente huge budget fluctuations and

continue to suffer foreign currency losses.

148

321
PPSSCC ISSUE SUMMARY: INFQRMATION GAP

TASK FORCE REPORT: Department of State

ISSUE No./TITLE: STATE 4: Purchase of Foreign Currencies

DEPARTMENT/PROGRAM: Department-wide

PAGE REFERENCE [REPORT (R)/APPENDIX (A)1: 41 (R)

THREE-YEAR SAVINGS ($ millions): $17.1 (S)

FUNCTION/CATEGORY: Identification

PROBLEM CLASSIFICATION: -Quality

BACKGROUND:

The'United States buys foreign Currencies for payment of

operating 4xpenses in other countries, including salaries of

foreign nationals, contractualserv'ices, -rents, supplies, and

travel. DOS foieign currency disbursements totaled approximately

$488 million

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

No studies on foreign currency hedging exist. The GAO

studies that hay been published to date are directed at

government proc dures for buying foreign currencies and have not

addressed the s bject of hedging. 410' i DOS cannot accurately forecast its foreign currency

obligations and purchases. This leads to mismanagement and

unplanned budgetary fluctuations.

149

3-2g
ppstqc ISSIJESUMMAiiii INFORMATION GAP

TASKSF9RCE REPORT:. Department of'State

ISSUE No./TITLE: /STATE 5: Bureau for Refugee Programs (BRP)

DEPARTMENT/PROGRAM: Refugee Transportation Loan Program

PAGE REFERENCE [REPORT (R)/APPENDIX-(A)]: 50 E0

THREE YEAR SAVINGS,(5 millions):,: 48.7 (S) ,- 55.9-A-CA)

FUNCTION /CATEGORY: Identification

PROBLEM CLASSIFICATION: Quality

BACKGROUND:

BRP's FY 1983 budget is approximately $419 millibn. The FY

1983 budget contains an allocation of $67 million to replenish a

transportation loan fund administered by the International , Committee for Migration. (ICM).

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

BRP cannot recover much of the monies it contributes to ICM

because of the absence'of refugee-tracking systems._ In fact,

actual cost data on total refugee costs to the U.S. Government

are not available.

Indeed, the actual transportation loan,collectiolorate is

,8.81 percent based on the total outstanding balance, as of June

30, 1982. An outstanding receivables balance of $165 million

existed at that time.

150 323
IPPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK=FORCE REPORT: Department of Transportat.ien.

ISSUEINo./TITLE: TRANS 3.: Grant Management arid Control in-the

Urban Mass Transportaion Administration (UMTA)

DEPARTMENT/PROGRAM: UMTAPAGE REFERENCE [REPORT (R)/APRENDIX (A)T: 69-72 (R)

THREE-YEAR SAVINGS ($Pmillions): NQ

FUNCTION/CATEGORY: Financial

PROBLLEM CLASSIFICATION: ADP

BACKGROUND:

r Weaknesses in accounting and control systems make it

impossible for the UMTA to close its books, collect on delinquent

accounts or remit accurate payment.

we, INFORMATION 'GAP PROBLEM/CAUSE/CONSEQUENCE:

The UMTA spent $10 million on a computer, yet has beeri

unable to close its books since 1979. This agency has a FY 1983

operating authority of $3.4 billion and controls $25 billion in

t151

324
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Department of/kransportation

ISSUE No./TITLE: TRANS 3: Grant Management and Control in the

Urban Mass Transportation Administration (UMTA)

DEPARTMENT/PROGRAM: UMTA 4-

_ PAGE REFERENCE E REPORT (R)/APPENDIX (A)]: 69 (A)

THREE-YEAR SAVINGS (5 millions): $163.5 (S) (I: Info all)

FUNCTION/CATEGORY: Program

PROBLEM CLASSIFICATION: ADP

BACKGROUND:

UMIIA provides financial assistance to municipalities and

transit authorities throughout the U.S., chiefly through grants.

UNTA is essentially a grant- making agency that, in conjunction

with the grants, manages the funding and implementation df mass

transit projects. In FY 1982, 1,833 grants were issued, at a

total dollar volume of $3.4 billion.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

compIote-ttid-tteereftt-TeiformatItrty-ltm-7

processing and monitoring grant applications, for accounting for

apportionments, obligatiois and disbursements, and for developing

budgetary and other reports to the Congress.

Such information is not generally available because the

automated system that contains this data is not reliable as it

does not display, update or utilize existing information. Consequemtly, the regions have implemented a manual recording system ad do not input data into the computerized management information system.

As a result, neither system is accurate, consistent, reliable, or timely. This inadequacy, of information is a primary

cause of. UMTA's violation of the Anti-Deficiency Statute, which

results in grant overpayments and payments for ineligible

expenses, and in funds lapsing unnecessarily, as well as in funds

not being Aeobligated ar reappoitioned.

152

325
PPSSCC ISSUE SUMMARY: INFORMAlgON-GAF.

ge, 4 V TASK FORCE REPORT: Department of Transportation

ISSUE No./TITLE: TRANS 5: Automa ed.:Data Processing Operators

DEPARTMENT/PROGRAM: Department of Transportation

PAGE'REFERENCE [REPORT (R)- /APPENDIX (A)]: 94(R)

THREE-YEAR SAYINGS ($Apilliors): $46.4 (S)

FUNCTION/CATEGORY: Materiel

PROBLEM CLASSIFICATION:

BACKGROUND:

Identification

In 1983 it will cost DOT $160 million to operate its ADP

services connected with administrative systems. DOT has 170 data

processing installation locations, 400 central processing units,

and over 6000 pieces of equipment.

INFORMATION:

DOT does not have an effective monitor for gauging

compliance to agency objectives for -ADP projects, nor 4oei ft

have current tools for applied systems analysis and design or

de pertivent-wrdedatas tend ards,-

This lack of information,hampers the development of an

organized ADP system acquisition program.

326
PPSSCC ISSUE SUMMARY: INFORMATION

TAQiaRCE'REPORTI Department of thec'Treasury

ISSUE -1404/TITLE: TREAS 1: Collection of Delinquent -Taxes

DEPARTMENT /PROGRAM: Internal Revenue Service/Collection Division

PAGE REFERENCE [REPORT (R)/APPENDIX el0): 4 (R)

'THREE -YEAR SAYINGS ($ millions): $76.1 (S) (III: Info plus)

FUNCTION/CAtIGORY: Persqtknel

*./ t

.= M CLASSIFICATION: ADP.

The Coilectla Division of the IRS is responsible for collecting delinquent taxes and securing delinquent tax returns. As

of June, 1982, the IRS estimated that its accounts receivable.

(A/R) backlog.ordelinquent taxes had grown to a record level of

INFORMATION PROBLEM/CAUSE/CONSEQUENCE:'

Information cincerhing the effectiveness of various

delinquency notices and account classification (i.e. according to

age,_ collectibility, and other characteristics) is not available.

Management generally lacks systems and controls that inventory

the AIR, monitors records, monitors collection activity, measures

employee efficiency,..2r produces management reports. Currently

the functiohlfs ovet'bWdened by paper.

The problems relate to understaffing, and inefficient

'deployment of professional staff to other duties.

-,103 a result, IRS's limited collection resources 'are not

being effectively deployed and the collection of delinquent taxes

is not expedited, resulting in loss of revenues and increased

costs to the Governmant.

.154.

327
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Departmene of the Treasury

ISUE.A0../TITLETREAS Cost/Senefit of ZRS Personnel

AdditionSI

DEPARTMENT/PROGRAM: Internal Revenue Service (IRS) Commissioner

PAGE REFERENCE [REPORT (R) f APPENOIX (A)1: 21-(R)

THREE-YEAR SAVINGS ($ millions): NQ

FUNCTION/CATEGORY: Personnel

PROBLEM dLASSIFICATION: ADP

BACKGROUND:

9 Personnel policies relative to the IRS staff additions. are

the responsibility of the IRS Commissionet. Recent trends reveal

"overall workload related' to tax' administration is on the rise. . Yet,: total employment, in IRS has, remained virtually unchanged.

The effect. of this trend has been a general decrease in enforcemeni presence- In response to' these trends, .IRS began a program

known as.theRevenue Initiative Proposal,. which proposes' adding

personnel to its revenue-generating functions.:d

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

CLitrent methodologies -to determine the nature,and:amount of

IRS,personnel additions provides data than are inaccurateIpr

Bost /benefit There are. inaccuracies, inconsistencies,

and no system -wide compirehensive rmethodology. to:evaluate per -

sonnel additions. As a result, management is .unable.Ed :judiciously,. evaluate alternative Manpower procurement programS.

155, . 328
PPSSCC'ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT:' Department'bf th4. Treasury

,ISSUE No. /TITLE: Further Study

DEPAHTMENT/PROGRAM: Burea0,....of the Mint , PAGE. REFERENCE [REPORT (R)/APPENDIX (A)]: 185 (R)

THREE YEAR SAVINGS ($ millions): NQ

.FUNCTION, /CATEGORY: Facilities

PROBLEM CALSSIFICATION:: ADP

BACKGROUND:

,Bi4reau bt.,the Mint cost accounting systems are manual and

.aie oriented more ,toward tracking precious, metals than

identifying accurate manufacturing costs. The functions of

the Mint.aTe,funded by-six,differeht procedures vhich require

extenslvet separate accounting systems. This hampers long=range

planning..

INFORMATION GAP.PROBLEM/CAUSE/CONSEQUENCE:

. The lack of accurate manufscturing.cbsts makes it impossible

to determine Whi-ch.,manufacturing facility, should be responsible'

for the production of various coins. , Tte, Mint should develdp an

automated cost accounting system immediately.

156

32/
-r

PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: User Charges

ISSUE No./TITLE: USER 1: User Charges Program Management .

:DEPARTMENTtPROGRAM: GOvernment,-wide

PAGE REFERENCE.TREPORT 4i:0/APPENDIX (A)1:, (R)

THREE-YEAR.SX4/NGS NQ

FUNCTION/CATEGORY: Financi,a1

PROBLEM CLASSIFICATION:- Structure

BACKGROUND:

The receipts from ttie conduct of market-oriented activity

that are business-type transactions are called user charges. The

POSStask Force considered user chargei as any charge collected

from recipients of 'Government goods, services, or other benefits

which are not shared by the public and which provide a specific

benefit to an identifiable recipient. In FY 1966, there were

more than 1,500 user char4e programs in the Federal: Government.

While no exac.t count can be found, there.are about the same number today. The revenues from those programs are significant --,

approximately- $40 billion in FY 1981. The responsibility for

user charge policy and implementation at the central Government

level rests with OM?.

INFORMATION GAP PROBLEM /CAUSE /CONSEQUENCE:

There is no published Government-wide report, survey, or

accounting.of user charges programs. The original annual reporting on user charge activities from the agencies to OMB was subse-

'quently:changed to:five-year reports, and-ultimately dropped completely in 1974. The accounting systemsused within the agencies

are to meet management- creeds-:- there is-an-Inability to

give credit or recognitier for the collection.of receipts, lack

of clarity as to appropriate accounting methods, difficulty in

determining the amount of'funds availablefor program operation,

difficulty iri determining accountability for program performance,

and inability to allocate between user charge business-type . activities and general public purpose programs.

The existing budgetary accounting system acts as a disin -.

centive for the efficient collection of user charge receipts.

Budgetawy restrictions provide few incentives for effective user

charge program-management-wlthIn-t,pe_ageh_c_les.

As a result, "the Government does not set prices or manage ,

receipts, so as to maximize productivity, cost recovery, and program efficiency for the benefit of the users and the general taxpayers. 157
, . PPSSCC ISSUE SUMMARY:, INFORMATION GAPTASK FORCE REPORT: User Charges

ISSUE No./TITLE: USER 4:, National Park Service

DEPARTMENT/PROGRAM: Recreation

PAGE REFERENCE [REPORT (R/APPENDIX (A)): 62 (R)

THREE-YEAR SAVINGS ($ millions) : ,$99.3 (R) (III: Info plus)

FUNCTION/CATEGORY: einancial

PROBLEM CLASSIFICATION:, Identification

BACKGROUND:

The National Park SerVice (NPS) manages 74 million acres in

the United States providing recreational facilities at over 300

parks. Entrance fees are charged at 64 of the parks, and at most

of the parks user fee and special permit fees-are'colleCted. In

1982, the total appropriations for the NPS were $602.2 million,

of which approximately $47-3.7 milliOn was for the operation of

the NPS perk management activi-ties. Ovet$176 million was for

the operation of parks charging feesi TOtal receipts in',FY 1981

were $16.15 million, or 10 percent of the.tOtal 'operating budget.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENC,

The NPS doesnot know with certainty the costs of collection

ot theit fees. Most of the area offices of the NPS estimate

these statistics because there is no separate accounting cOde

dedicated to 'collection costs. The NPS does not maintain statistics on costs of construction of recreation facilities or

other capital expenditures.... Such items as sewers, roads, visitors centers and other projects which require multi-year planning

and design work are accounted for under a Separate' construction

account. -Firra-11-y-F-. theexpensdsl-of operation-and ma-intenance--at

ten iegional offices of the NPS and Of the National Office are

not included in any dos; categories in the accounting structure.

for recreation management. There is considerable Congressional

. pressure to keep fees atothe parks low, as well as from fishing

and hunting groups: Thdre is little.ir,--,tive to closely track

costs involved with par administration %,.len the level of fees is

dictated..

As a result, NPS lacks thd information for devising a

rational system of user fees. 'Consequently, the general taxpayer

Fmr_a_majnropnrrinn_of the pxpeAdlinres,insLolve.d in

providing-recreatinnal facilities in the NPS.

158 331
,PPSSCC ISSUE SUMMARY: INFORMATION. GAP.

TASK FORCE REPORT: User Charges

4 ISSUE No./TITLE: USER 8: 'Qepartment of Agricultute Forest

Service Firewood Program

'DEPARTMENT/PROGRAM: Forest. SerVice (FS) Firewood Program

PAGE REFERENCE (REPORT (R)/APPENDIX (A)): 103 (R)

THREE-YEAR SAVINGS ($ millions): $63.6 (R)

EUNCTION/CATEGORY: F,inancial

`PROBLEM CLASSIFICATION: Structure

BACKGROUND:

Prior to 1974, only tficase persons liVing on'or near forest

banks could obtain'a permit to participate. in the free use firewood program. The energy crisis prompted FS to provide free,use

permits to anyone, regardless of, where they lived, as ling as the

wood they out.wasfor persorlal use. In FY 1981, over 900,000

permits were issued, allowing removal of.some 4.2 million cords

4, of wood. FS estimates that im excess of $5 million per year is

needed to administer the program.

INFORMATION GAP- PROF 1AVICA,6E/CONSEQUENCE:

flanagement systems do not exist that will track the cost of

administering, the firewood program. There is no accountability

for costs as related to revenues or program benefits. Further,.

there is not sufficient information to determine the real, value

of,the wood being 'removed.

This is considered a "small" program and theefore the cost

-to-impiement managementToontTols-ie considered-unwarrented. Fur7

ther, administration and management is fragmented between the

national FS timber management office and operational field

offices.

As a result is no control mechanisr, to establish a.

fee system that A allocate supply to 'demanJ or relieve the

taxpayer of the cost of administering' the program.

-.4 r 159: 3 3
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASr FORCE REPORT: User Charges

ISSUE No./TITLE: USER 17: Freedom of /nformation Requests

DEPARTMENT /PROGRAMv: .covernment-wide

PAGE REFERENCE (REPORT '(R)/APPENDIX (A) ]: 183 (R)

THREE-YEAR SAVINGS (S millions): $231.7 (R) (I: Info all)

FUNCTION/CATEGORY: Financial

PROBLEM CLASSIFICATION: Identification.

BACKGROUND:

The Freedom of InformatiOn Act (FOIA) is a Government-wide

statute allowing the public to request inform'ation from the Government. When a request is made that is considered of general public interest; no charge is made. '.when there is a charge, it

covers only the. 1oW coatof the search time and copying. Agencies do not generally charge other Federal agencies, legislative committees, and subcommittees for requests that total $10 or

less, requests for. which no information is available, requests on which inforWation is withheld, and other types of services.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

No exact figures are available to determine the number of

agencies FOIA requests that have a fee assessed and collected.

Therefore, it is impossible to determine the actual costs-to any

agency to process FOIA -requests per staff-hdur.

There is no cost accounting management.systeM,to provide the

agentl/ with a reliable fee recovery system becausethe agency

tends to:handle FOIA requests as an'adjunct to its regular busine8i. Further, -4-equesting information from -Government agencies' is seen as a .Valuable right of individuals, and charges are made as an "afterthought." _However, it has been determined that the

practiceof requesting FOIA material has become part of regular

market'research, and industry is taking. advantage of Government

resourcesto obtain information that is of economic benefit to

them.

As a result, agencies are not recovering the costs for fulfilling SOIA requests and an average of 92 percent of the costs. of the FOIA activity is subsidized by the taxpayer. There are

service companies in the bu.i_nes_s_o_f__filingLEOZA-r-e-q-uest-s-onbehalf,of clients who charge .feeS that are frequently three to four times the cost charged by Government agencies.

160

333
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Veterans Administration

'ISSUE No./TITLE: VA 1: Claims Processing

DEPARTMENT/PROGRAM: Department of Veterans Benefits (DVB)

PAGE REFERENCE [REPORT (R)/APPENDIX (A)): 9 (R)

THREE -YEAR SAVINGS (S millions): $271.7 (S) (.I: Info all)

FUNCTION/CATEGORY: Personnel

PROBLEM- CLASSIFICATION: Quality

BACKGROUND:

The VA''s DVB will disburse $15 billion. in benefits to six

million claimants in FY 1983. The benefit payments include those

for: compensation, pension, educational-assistance, vocational

rehabilitation, survivor, and burial benefits. The claims are

processed through a. network of 58 field stations, staffed by a

total oi14,150'employees, as of FY 1982. Actual processing

takes -.from 25 to 40 days, compared to comparable private sector

processing time of four days.

INFORMATION GAP PROBLEM /CAUSE/CONSEQUENCE :

The DVB has a work measurement system designed to evaluate

performance., destribe-wdrkflaW.,: anaAltorecast faeldPsbaticn staffIneedS. This system generates ',Inaccurate data that masks the'

current level of overstaffing the field stations.

This inadequacy is due to the'faulty methOdology used in

measuring productivity and effectiveness: the DVB-uses a crude,

random time sampling approach,'and addS 15 percent for n

productive time, rather than the private sector allowan f 5.

10 percent. Further, the VA does not us'e the data to evaluate.

personnel staffing levels or project,. future personnel requirements. The current data is used merely to compareperformance

. among field stations and monitor the range of.productivity within

.a 65-92 percent acceptable level.

As a result, productivity in the field tations is low,.

timeliness in the processing of claims has dclined, and the

offices are overstaffed. Management controls necessary to maximize output of existing field station personnel do not exist.

161

334
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT:' Veterans Administration (VA)

ISSUE No./ TITLE: VA2: Error Prevention

DEPARTMENT/PROGRAM: Department, of Veterans Benefit 1DVB)

PAGE REFERENCE (REPORT (R) /APPENDIX (A)): 21 (R).

THREE-YEAR SAVINGS ($ millions): $1,484.5 (S)

FUNCTION/CATEGORY: Program

PROBLEM CLASSIFICATION: Quality

BACKGROUND:

The VA's Department of Veterans Benefit pays out $15 billion annually to six million claimants. There is every indication

that overpayments resulting from currently identified errors are

large -- in excess Of $500 million.

INFORMATION GAP PROBLEM/CNUSE/CONSEQUENCE:

there is 'no.comprehensive infOrmadi n on the error problem.

The VA has no basis for knowing the acc racy of the $15 billion

paid annually.as.beritfits to vetera and their survivors.

'Necessary data to assess the accuracy of the benefit payments does not exist

162 335
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: Veterans Administration

ISSUE No.ATITLE: VA 3: Debt collection

DEPARTMENT/PROGRAM: DepartMent of Veterans Benefits PB)

PAGE REFERENCE (REPORT.(R)/APPENDIX (A)]: 31 (R)

THREE-YEAR SAVINGS ($ millions): $ 53.9 (S) (III: Info plus)

$208.0 (CA)

FUNCTION/CATEGORY: Financial

PROBLEM CLASSIFICATION: ,Quality

BACKGROUND,'

The VA operates systems to pay $15 billion in benefits to

six million veterans_and their survivors, in six program areas.

When overpayments are recognized, an, accounts receivable field is

created. As of September 1982, the VA had account receivable of

$905 million. 'Of that amount, $695 million was in overpaymentS,

and $210 million was from defaults on load guarantees. New

establishments ($460 million) were greater than the collection of.

funds ($348 million).

I-NFORMATION.GAP PROBLEM/CAUSE/CONSEQUENCE

Accurate information regarding the value and status of the

debt owed the VA is not prOduced. For example, tw,o reports covr

ering the same period showed discrepancies in accounts receivable

of 861 accounts and a value of $1.2 million. Even wheon.theliscrepancies were explainedthey could not be confirmed ter atcu-,

racy. The current reports. being generated do not define-the

problems, do not accurately reflect the real situation, and do

not show accomplishments.

This is ,attributed primarily to the accounting.practices

used: the definition-of ,accounts receivable includes all debt of

the VA; an enormous amount of "old debt" is retained on. the

books, a large portion of which will never be collected; and

these is a delay in recognition of the debt.

As a result, confusion exists in reporting and management.

The debt collection problem Lk masked and creates a burden for

the debt collection activity, l'"nd the recovery rate is low.

163

336
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: 'MOSIR.I: Publishing, Printing,

Reproduction & Audiovisual

ISSUE No. /TITLE: PPAV 1: Publications Management

DEPARTMENT /PROGRAM: Govornment-wide

PAGE REFERENCE REPORT (R) APPENDIX (A) : 10 (R

THREE-YEAR SAVINGS ($ millions): $331.0 (s) (III: Info plus)

FUNCTION/CATEGORY: Support Services

PROBLEM CLASSIFICATION: Structure

BACKGROUND: irA

( Every department ovilitgency of, the Federal Government( is,

involved-with the publiinfig of written and printed material for

public distribution or internal use. t*,:-7 of this activity are thought to be $; 716 mil on Apw,re, of 15,000 publications per year, thour7h no'exact number is known.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

Agencies have no centralized inventory of publicatios'

produced or. in circulation. There is no process to review and

approve the issuance of new publications at,a central level. No

standards for quality control exist.

Thik is mostly due to the fact that a "publisher function"

is neither defined nor fulfilled. There is no job destription in

the Government to satisfy the role of a publisher, as used in the

private sector, who would decide to publish, target the audience,

control the quality, and set the,price of. a publication.

As a result, there are many duplicative and unnecessary,

publications being produced, many of poor quality,` at great cost

to the taxpayer. 4.

4

164 3"1
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: MOSIR I: Publishing, Printing,

Reproduction and,Audiovisual

ISSUE"No./TITLE: PPAV 2: User Fees

DEPARTMENT/PROGRAM: Government-wide

PAGE REFERENCE [REPORT (R)/APPENDIX (A)]: 20 (R)

THREE-YEAR SAVINGS ($: millions):

FUNCTION/CATEGORY: Financial

PROBLEM CLASSIFICATION: Structure

BACKGROUND:

$264.8 (R) (I: Info all)

°

Federal Government agencies offer some publications for free

distribution, and others for sale. The Government Printing

Office (GPO), a legislative branch agency, sets the price of all

agency publications it sells, and all revenues go into the GPO

revolying fund. By law, GPOhas the exclusive'right to set . publications charges. This leaves agencies to bear most of the

costs of publications, while the sales revenues go to GPO. The

prices are set on the basis of a formbla (printing costs plus 50

percent) that does not include editing and design work, nor does

it recognize market considerations.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

Agencies have no cost accounting structure that would permit

the accurate tracking of all costs..associated with publishing.

This void is thought to havefresulted begause under the

/OW

current, la Pp reservesthe exclusive right to set:publication

priceSYana' -.14ct sales revenues. Thus, the agencies laCk

--i,ncentive tctestabliah_a-_syetem-for tracking actual costs..

t. . As 'a result, there is no basis on which to. develop a

rational system of user fees. The total unrecovered cost of

agency publication ptip'grams in FY 1,982 was approximately $1.3

billion.

A

165

:38
PPSSCC ISSUE SUMMARY: INFORMATION GAP

TASK FORCE REPORT: MOSIR I: Publishing, Printing,

Reproduction, and Audiovisual

ISSUE No./TITLE: PPAV 4: Mail Management Improvement

DEPARTMENT/PROGRAM: Government-wide

PAGE REFERENCE [REPORT (R)/APPENDIX (A)): 36 (R)

THREE-YEAR SAVINGS (S millions): $549.5 (S) (I: Info all)

, FUNCTION/CATEGORY: Support Services

PROBLEM CLASSIFICATION: Identification

BAfKGROUND

Postage fees for Federal mail were $900 million in FY 1982.

Personnel, space, and other costs of handling Government mail

exceed the postal charges. Private delivery services are also

used, and estimated to exceed $100 million per .year. The General

Services Administration-has estimated that 10 percent of the mail

operations costs are.wastedo due to ineffective mail management.

and uneconomical mailing practices.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

Systems for maintaining Federal postal.accountability,do not

exist. The extent of total Federal postpge'and mail-related

expenditures is not Known. The informa,O)on on mailiAtg procedures

and standards is neither documented nor widely disseminated.

The responsibility and authority for mail management are not

clearly defined. There is no accountability,,monitoring, or

follow-up on this activity against a budget. line item.

. As. .a result, there has been waste of Government- funds

through' various .uneconomic pradtices such as the unnecessary use

.94 higher mail classifications, uneconomical packaging,-and failure to use bulk mail discounts.

339
PPSSC_ ssug SUMMARY: INFORMATION GAP

TASK FORCE REPORT: MOSIR I: Publishing, Printing,

Reproduction and AUdiovisual

ISSUE No./TITLE: PPAV 5: Improvements to Printing Production

NIP DEPARTMENT/PROGRAM: Government-wide

o PAGE REFERENCE (REPORT (R)/APPENDIX (A)]: 41 (R)

THREE-YEAR SAVINGS ($ millions): $158.9 (S) (III: Info plus.)

FUNCTION/CATEGORY:. Facilities

PROBLEM.CLASSIFICATION,: Identification

BACKGROUND:

Executive Branch departments"operate some 235 printing

plants, at a cost of,$191 million in FY 1982. Most plants

produce work originating within the agency, administrative in

/". nature, short-run in quantity, and needed for quick turn-around

or security purposes. These plants are apthorized and reaulated

by the Joint CoMmittee on Printing (JCP), a legislative

authority- . INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

Information on' the utilization of plants, presses, and staff,

versus existing capacities is not known. It is not maintained by

the JCP or any other source. While the JCP regularly collects

information from the plants on, quantity produced and price, the

forms are outdated and do not identify factors that would be

necessary for performance evaluation. Once the data is in, it is

maintained in hard copy. Computer storage was recently implemented, but for only two years of data. Furthermore, it is not

easily accessible'for retrieving the information in a useful

form.

er This situa.tion has _developed because of the bifurca.ted management structure between the JCP, a small Congressional committee,, and the delegation of certain authority to the agencies.

Lines of responsibility and authority have not been clear.

As a result, numerous inefficiencies have re ultea: plants

continue tp operate.with excess capacity, low .equipment utilization, and low quality equipment'with frequent breakdowns, all

of which- contribute to the excessively high costs of printing --

nearly 30 percent. higher -7 to produce in these plants ass

compared to'.commercial printers..

167

, 340.
PPSSCC ISSUE SUMMARY: INFORMATIONGAP

TASK FORCE REPORT: MOSIR I: Publishing, 'Printing,

Reproduction and Audiovisual

ISSUE No./TITLE:" PPAV 6: Copying.and Duplicating

DEPARTMENT /PROGRAM: Government -wide

PAGE REFERENCE.1CREPORT (R)/APPENDIX. (A)1:, 58 (R)

THREE-YEAR SAVINGS ($ millions): $327.7 (S) (I: Info all,)

FUNCTION/CATEGORY: Support.Services

PROBLEM CLASSIFICATION: Identification

BACKGROUND:

to. The Executive Branch of the Government has ovey' 65,000 copiers and duplicators in use, and is Spe*ding an .eSt/imated $650

million for their acquisition and use. '-Copying(ana duplicating

is thought .to be the fastest:expandig method ofprihting production in the GovernMent.

INFpRIMATION GAP. PROBLEM /CAUSE /CONSEQUENCE:

There is,Currently no information collected or maintained,

-at any.olficial! level, on copying and duplicating.equipmeqt,

volume of production,. or costs.' There is a lack ofIbudgetary

accountability. fbrihis expense.

This situation has developed because-Tcopying is.generally

viewed asa negligible administrative expense. Further, the

recent advances in copying technology have blurred the

distinctions between printing, duplicating, and copying

equipment. Thus, -_the once-well-diefined2universe of central

management over* "printing" equipment, by the Joint Committee on

----Pt-I-Rting,-ha8-bettite-lesS clear:-

As a result,"this'has become the fastest grOwibg a'hd

supervised area of printing production. Copying and duplicating

management pi'actices, particularly'in the acquisition area, are

often uneconomic; Where:-two agenciesAave centralized the management of this area, significant sav4IgS have resulted.
PPS...WC ISSUE SUMMARY: INEORMATION 'GAP

t ItASK FORCE REP,ORT:, -Tra4e1 and Traffic. Management

, (MOSIR II)

ISSUE NO./TITLETTM 11-Federal Travel ProCUriMent

DEPARTMENT/PROGRAM:, Government- wide

PAGE. REFERENCE CREPORTR)/APPENDiX,CA)]: 3 (ll)

THREE- YEAR SAVINGS (S $984.0 (S, (II: Info only)

.-BLINCTION/CkTtGry

:PROBLEM CLASSIFICATI.ONStructure,

-Support Services

;BACKGROUND:,

Virtually;every department and agency in the, Federal

government is involved i n personnel travel' transportation.

In FYA.98Sthe government expetts-tO spend approximately $5.2

billion on employee travel. About.45percent of the Federal

teavel dollar is spent PP transportation, about 39 percent oji

subsistence, and the remainder on miscellaneous items.

Goyernment travelers take Mit0 than 15 million trips each year:

. There' are 6 agenCies:with malbr travel. policy oversight

responsibilities, including tae GSA DCIY: The goverpm nts.s. annual,

exPenditUre:lor travel is far larger than that of t argest

.private sector organization-.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

Current information on.publicllyavoilable travel services

and rates-are not .readily availably to-governmeht travel

Procurement'proIeSSionels. They do, not have information

concerning, routes: 'rates: speCial, local anik excursion

discounts;. local ,hotel or motel`. iscounts: etc.

. .

. The decentralized,strdcture of 'Federal travel 'procuriem'eht

severely restricts, the flow 6f information to the various . agencies.' . , , b

... As 'a result, the gOvernri4nt does not maximize.itsoop-:

pottunitiestO aj- take advantage of travel Opportupities . available at the. lowest cost and optimum valUe in the market

place and b) negotiate special additional volume discount's-

[CONT'D ON.04XT PAGE]

169

312
INFORMATION GAP (TTM 1.tONT'D)

4.#

_ I e.Federal Governlientks travel volume gives it. the leverage to

negotiate the lowest available prices if such information is

centrally'gatheredp-organiwd, and applied in global. contract

negotiations. The present fragmentation of Federal travel

procurement services is thus costly to the government.

4 ° a0
6?)

PPSSCC ISSUE SUMMARY:- INFORMATION GAP

TASK FORCE REPORT: Travel Ond Traffic ManageMent.

(mosrt 11)

ISSUE No./TITLE: TTM 3: Traffic MNagements

DEPARTMENT/PROGRAM: Government -wide

PAGE REFERENCE (REPORT (R)/APPENDIX (A: 37 (R)

THREE-YEARSAVINGS, ($.millions): $529.6. (S)-(I: Info a1144

FUNCTION/CATEGORY: ,Support Service's

PROBLEM CLASSIFICATION: Structure

BACKGROUND:

Traffic management in.--the Federal Government includes the

rating and routing of more than 6 milliOn shipments a year. In

moving these shipments there are 4 to 6 thousand tenders tiled;en

government freight movements and literally millions 9.f rates and

routes from which to choose. Government bills of lading, alone

number over 6,5 million annually. The Federal Government is one

of the :largest movers offreight. fn.thevorld., significantly

larger than the biggest private Sector firms. During:FY 1982, -.

executive agenCies spent $4.6 billion on the:transpOrtationtof

freight. Cdrrent freight procurement and traffic management

procedures are neither uniforM Government' -wide nor:integral* in

operation. Primary responsibility for the transportation'

procUreMent;.and,traffic management resides with 2 executive

a4enciesi the Department;of-'-Detense- and-General Services

INFORMATION.GAP,PROBLEM/CAUSE/CONSEQUENCE::

CUrrent.goveriAbentfreight traffic management systems are

not adequate to gather .Consolidated Government-wide shipping data . in Order'to-take adVantageof the government's significant volume.

and,freqUency of traffic. The ovIerAment dbeS'not gather

accurate and,tiMely information on all shipments by all agencies.

The current system rides not allow for GOvernMent-wide gathering

and consolidation of shipping information. The GoVernment's:

traffic management systeM is not. suffiCiehtly:autoMate4 to

analyze and optimize .transportation movements that reflect

[CONT'D ON NEXT PAGE]
INFORMATION GAP (TTM 3 CONT'D)

. the complex. and changing system of rates and routes.. Information

found,on :the gOvernment:billS,of lading is not used for'triffic

,management. No. attempts have'been.Made toexplOtt this

procurement information for the benefit of traffic. offioers.

This inforMation soUrce.identifies.volumet,' frequencies,.

carriers, service. capabilities and variances:in traffid"

practices. _ `Yrhe Government's system for traffic management is

decentralized. GSA and DOD are not cooperatively or. jointly

pursuing compatible automated solutions to gather, store, or

utilize freight traffic information. Currently, they have no

incentives to combine 'efforti.

4

A. Without centralized coordination, the Government cannot

'optimize the efficieilt flow Of-freight and take. advantage of its

, size to obtain the lowest cost carrier service: In the absence

of this intormation,.the Government's ability .to negotiate

discounts with carriers presently serving the government

hampered. :tonVerselY, the absence of consolidated) inf.orma ],on

regarding total Government freight transportation requirements

inhibits the offer. of lower tenders or contracts by carriers who

cannot be fully advised of available Government volumes.

172

345

4
- PPSSCC ISSUE SUMMARY; .INFORMATiON'GAP

TASK FORCE REPORT: Travel and Traffre Management

(MOSIR II)

ISSUE No./TITLE: TTM 4: TransPoitation Audit

DEPARTMENT/PROGRAM: General Services Administration

'PAGE REFERENCEEPORT (R)/APPENDIX (A)J: 47 (R)

y. THREE-YEAR SAVINGS ($ millions): $165.2 (S) (I: Info all)

FUNCTION/CATEGORY: Support Services

PROBLEM CLASSIFICATION:* Structure

BACKGROUND:

GSA is responsible for post-payment rate audits of freight

bills and for recoveg,ing freight rate overcharges. GSA'sOffite

of Transportation Audits employs approximately 110 rate auditors

in a highly selective post - payment examination of freight bills.

The 'examination occurs about 18'mdths after payment has been

made. The budget assigned to administer and perform thtS audit

function was $6.1 million in FY 1982. Overcharges'on freight

bills are common in both-the government and the private sector.,

However, the govImagrents identification rate is about one fifth

of that of the:, 0,Wi ate sector. GSA's rate overcharge recovery

-.ratio is about 87 Percent of overcharges identified or 0.32 percent of billings.' This is tempered to the private sector's_

experience of 1.75 percent.

INFORMATION GAP PROBLEM/CAUSE/CONSEQUENCE:

GSA does not know the total freight charges represented by

the bills it receives for audit nor the total freight charges on

the bills on which overcharges are identified. GSA records track

the number of bills audited, the number-of bills on which

overcharges are detected, and the amount of Overcharges

identified. The'records.report theactivities of theOffice of

Transportation Audits and compare results with previous' periods.

They do not track peeibrmance in absolute terms nor quantify

overcharges as a percent-of total freight charges.

[CONT'D ON NEXT PAGE]

173

34 6

4i)
INFORMATION GAP (TTM. 4 CONT'D)

This problem arisesipartially because GSA uses manual

procedures to rate audit only a portion'of the freight bills it

receives. Further, GSA has no automated system for, use, in the

storage or application of freight tariff data or freight bill

auditing.

As a result, SA cannot properly evaluate, the performance of

its rate audit activity. The Office of Transportation Audit

evaluates the effectiveness and productivity of its rate audit

activity only by making relative comparisons to its own past'

performance and not to.any objective or private sector standard.

As a result, government recovery of freight rate overcharges is

very low compared with private Sector-experience and the

government is not recoveririg a substantial amount in rate

overcharges.

c

GOVERNKENT PRINTING OFFICE : 1984 0-421.899/4726