United States General Accounting Office

GAO Testimony

Before the Subcommittee on Benefits, Committee on

Veterans’ Affairs, House of Representatives

For Release on Delivery

Expected at 8:30 a.m.

Wednesday, May 7, 1997

VETERANS’ EMPLOYMENT

AND TRAINING SERVICE

Focusing on Program Results to

Improve Agency Performance

Statement of Carlotta C. Joyner, Director

Education and Employment Issues

Health, Education, and Human Services Division

GAO/T-HEHS-97-129

Veterans’ Employment and Training Service:

Focusing on Program Results to Improve

Agency Performance

Mr. Chairman and Members of the Subcommittee:

We are pleased to be here today to discuss the Veterans’ Employment and

Training Service (VETS) and its initiatives in response to the Government

Performance and Results Act of 1993 (GPRA).

Unemployment and underemployment have traditionally been serious

problems for veterans. The Congress has made it clear that alleviating

these problems is a national responsibility. Although the Department of

Veterans Affairs is responsible for most of the nation’s services for

veterans, the Department of Labor administers programs and other

activities designed to help veterans find jobs and training opportunities.

The Wagner-Peyser Act of 1933, which created a national system of public

employment offices, specifies that veterans receive priority service and led

to the establishment of a veterans’ bureau within the Department of Labor,

which eventually became VETS.

My comments today will focus on four areas: the value of GPRA in

improving agency performance, the employment and training performance

measures currently used in VETS, VETS’ response to GPRA, and our

assessment of VETS’ response. The information we present is derived from

our ongoing work for this Subcommittee regarding the veterans’

representatives employed by the states under grants from VETS, our review

of the agency’s draft strategic plan for fiscal years 1997 through 2002, and

discussions with agency officials about VETS’ actions in response to GPRA.

In summary, GPRA is a powerful tool that brings discipline to program

management by requiring agencies to clarify their missions, establish goals

and a strategy for reaching them, measure performance, and report on

their accomplishments. Our work at VETS has shown that its current

performance measures focus more on process than on results. VETS has

now developed a draft strategic plan and performance measures,

consistent with GPRA, and has submitted it to the Office of Management

and Budget (OMB) for review. We believe the proposed performance

measures for employment and training services are an improvement over

VETS’ current approach because of their increased focus on results. But the

plan, so far, is a draft and has not received final approval by Labor or been

incorporated into an overall departmental strategic plan. In addition,

development of a strategic plan and improved performance measures does

not guarantee improved performance. Continued senior management

commitment and effective implementation are necessary to achieve the

improved agency performance that is envisioned by GPRA.

Page 1 GAO/T-HEHS-97-129
Veterans’ Employment and Training Service:

Focusing on Program Results to Improve

Agency Performance

Background The mission of the Veterans’ Employment and Training Service is to help

veterans, reservists, and National Guard members in securing employment

and protecting their employment rights and benefits. Services provided are

to be consistent with the changing needs of employers and the eligible

veteran population, with priority given to disabled veterans and other

veterans with significant disadvantages in the labor market. The key

elements of VETS’ mission include enforcement of veterans’ preference and

reemployment rights, employment and training assistance, public

information services, interagency liaison, and training for those assisting

veterans.

VETS carries out its responsibilities through a nationwide network that

includes representation in each of Labor’s 10 regions and staff in each

state. The VETS staff at the state level monitor the operation of VETS’ two

primary programs providing employment and training assistance to

veterans: the Disabled Veterans Outreach Program (DVOP) and the Local

Veterans Employment Representative (LVER). DVOP and LVER staff, whose

positions are federally funded, are part of states’ employment service

systems and provide direct employment services to eligible veterans. The

total fiscal year 1997 appropriation for VETS was about $182 million,

including $82 million for DVOP specialists and $75 million for LVER staff.1

LVERs were first authorized under the original GI Bill, the Servicemen’s

Readjustment Act of 1944; DVOP specialists were established by executive

order in 1977 and later authorized by the Veterans’ Rehabilitation and

Education Amendments of 1980. The duties of DVOP and LVER staff for

serving veterans, as specified by law, include

• outreach to locate veterans,

• job development for veterans,

• networking in the community for employment and training programs,

• providing labor exchange services to veterans,

• making referrals to support services, and

• case management.

These programs are required by law to provide employment and training

opportunities specifically for veterans, with priority given to the needs of

disabled veterans and veterans of the Vietnam era. Each state is expected

to give priority to veterans over nonveterans for services in their state

1

VETS provides formula staffing grants to the states for LVER and DVOP staff. Its fiscal year 1997

appropriation is planned to fund 1,397 LVER positions and 1,598 DVOP specialists. The appropriation

also included about $23 million for administrative costs and $2 million for the National Veterans’

Training Institute, which trains service providers’ staffs and managers.

Page 2 GAO/T-HEHS-97-129
Veterans’ Employment and Training Service:

Focusing on Program Results to Improve

Agency Performance

employment service system. In the simplest terms, this means that the

local employment office is to offer or provide all services to veterans

before offering or providing those services to nonveterans.

Managing for Results The Government Performance and Results Act of 1993 is the centerpiece

of a statutory framework provided by recent legislation to bring needed

discipline to federal agencies’ management activities. Other elements are

the 1990 Chief Financial Officers Act, the 1995 Paperwork Reduction Act,

and the 1996 Clinger-Cohen Act. These laws each responded to a need for

accurate, reliable information for executive branch and congressional

decision-making. In combination, they provide a framework for developing

(1) fully integrated information about an agency’s mission and strategic

priorities, (2) performance data to evaluate the achievement of these

goals, (3) the relationship of information technology investments to the

achievement of performance goals, and (4) accurate and audited financial

information about the costs of achieving the goals.

GPRA is aimed at improving performance. It does so by prompting each

major federal agency to ask some basic questions: What is our mission?

What are our goals and how will we achieve them? How can we measure

our performance? How will we use that information to make

improvements? GPRA forces a shift in the focus of federal agencies away

from such traditional concerns as staffing and activity levels and toward a

single overriding issue—results.

GPRA requires that agencies clearly define their missions; establish

long-term strategic goals, as well as annual goals linked to them; measure

their performance against the goals they have set; and report on how well

they are doing. In addition to ongoing performance monitoring, agencies

are also expected to perform discrete evaluations of their programs and to

use information obtained from these evaluations to improve the programs.

Each agency’s strategic plan—laying out its mission, long-term goals, and

strategies for achieving these goals—must be submitted to OMB and the

Congress by September 30, 1997. To help ensure that these plans reflect

the views, as appropriate, of the Congress and other stakeholders, GPRA

requires that, as agencies develop their strategic plans, they consult with

the Congress and solicit the views of other stakeholders. Next, beginning

with fiscal year 1999, executive agencies are to use their strategic plans to

prepare annual performance plans. These performance plans are to

include annual goals linked to the activities displayed in budget

presentations as well as the indicators the agency will use to measure

Page 3 GAO/T-HEHS-97-129
Veterans’ Employment and Training Service:

Focusing on Program Results to Improve

Agency Performance

performance against the results-oriented goals. Agencies are subsequently

to report each year on the extent to which goals were met, provide an

explanation if these goals were not met, and present the actions needed to

meet any unmet goals.

Over the last few years, we have done a large body of work on

management and operational issues across agencies and levels of

government.2

 For example, we have studied leading public sector

organizations that successfully pursued management reform initiatives

and became more results-oriented. This work has identified principles and

approaches that may be helpful to agencies and the Congress in carrying

out the activities set out by GPRA, such as developing strategic plans

through consultation with stakeholders and selecting performance

measures that are results-oriented and can be used to improve agency

performance.

Current Performance

Measures

In our ongoing work on the activities of DVOP and LVER staff for this

Subcommittee, we have learned that VETS’ performance measures are

focused more on process than on results, and performance is evaluated

only in relative, not absolute, terms. VETS uses 14 performance standards in

five service categories: (1) veterans placed in or obtaining employment,

(2) Vietnam-era veterans and special disabled veterans3

 placed in jobs with

federal contractors, (3) veterans counseled, (4) veterans placed in training,

and (5) veterans who received some reportable service. The first two,

which concern job placement, are results-oriented, but they do not require

information about the quality of the job placement, such as wages and

benefits, or whether the jobs are permanent.

The Assistant Secretary for Veterans’ Employment and Training, in

directing VETS field staff and state partners to provide input regarding the

development, piloting, and evaluation of new performance measurement

systems, characterized VETS’ current system as having been developed

more than a decade ago with little or no change since then. He also noted

2

See, for example, Executive Guide: Effectively Implementing the Government Performance and

Results Act (GAO/GGD-96-118, June 1996), Managing for Results: Using GPRA to Assist Congressional

and Executive Branch Decisionmaking (GAO/T-GGD-97-43, Feb. 12, 1997), Managing for Results:

Enhancing the Usefulness of GPRA Consultations Between the Executive Branch and Congress

(GAO/T-GGD-97-56, Mar. 10, 1997), and Agencies’ Strategic Plans Under GPRA: Key Questions to

Facilitate Congressional Review (GAO/GGD-10.1.16, May 1997).

3

A special disabled veteran is (1) a veteran who is entitled to compensation (or who, but for the receipt

of military retired pay, would be entitled to compensation) under laws administered by the

Department of Veterans Affairs for a disability rated at 30 percent or more or (2) a person who was

discharged or released from active duty because of a service-connected disability.

Page 4 GAO/T-HEHS-97-129
Veterans’ Employment and Training Service:

Focusing on Program Results to Improve

Agency Performance

that these performance standards are activity- and volume-driven and

provide states little incentive to focus services on those veterans who are

marginally job-ready or are most in need of intensive employability

development services. In addition, he did not believe the current

performance measures provided useful information on the impact of

services on veterans served.

In each of the five service categories, performance is measured in terms of

priority given to veterans compared with nonveterans in the services

provided by the states’ employment service system. The minimum goals

established by VETS state that veterans should be served at a rate

exceeding the service to nonveterans. Veterans and eligible persons

should be served at a rate 15 percent higher than nonveterans; Vietnam-era

veterans should be served at a rate 20 percent higher; disabled veterans

should be served at a rate 25 percent higher; and placement rates for

special disabled veterans should also be 25 percent higher than the rate for

other clients relative to jobs listed by federal contractors.4

 For example, in

one state, the placement rate for nonveterans was 14.65 percent; thus, the

required placement rate for veterans was 16.85 percent, or 15 percent

higher than the nonveteran placement rate. The state-by-state measures

are based on providing a higher level of services to veterans than

nonveterans rather than on establishing any goal for an absolute level of

performance. Thus, a state with poor services to nonveterans would be

held to a low standard for service to veterans.

According to VETS directives, failure to meet one or more of the

quantitative performance standards does not itself constitute failure to

provide priority services to veterans. State VETS directors identify other

factors that may affect the delivery of quality services before making any

noncompliance determinations.

VETS is required to report annually to the Congress on the success of the

states in meeting their performance standards with regard to veterans’

services. Although VETS has up-to-date quarterly data on states’

performance, annual reports for fiscal years 1994, 1995, and 1996 have not

yet been submitted to the Congress. These reports would document the

states’ annual performance against their standards. According to a draft of

the 1994 annual report, VETS determined that all but 14 states met all of

their performance standards during program year 1993 (July 1, 1993,

through June 30, 1994). Of these, 11 states were able to show good cause

for their inability to meet the standards (California, Iowa, Kansas,

4

These rates may vary from state to state because states may negotiate higher rates.

Page 5 GAO/T-HEHS-97-129
Veterans’ Employment and Training Service:

Focusing on Program Results to Improve

Agency Performance

Missouri, Nevada, New Hampshire, New Jersey, New Mexico, Virginia,

West Virginia, and Wisconsin). The remaining states—Ohio, Nebraska, and

the District of Columbia—provided VETS with an acceptable corrective

action plan.

VETS’ Response to

GPRA Includes

Proposed New

Performance

Measures

The current version of the draft plan has been submitted to OMB for review

and is to be finalized on the basis of OMB’s and other stakeholders’

comments. The plan includes mission and vision statements; strategic

goals and objectives; specific performance measures; and discussions of

the relationship between the general goals and annual performance goals.

The draft plan also discusses VETS’ strategy to reach its goals and key

factors likely to affect its ability to do so. The plan also lists relevant

stakeholders, including the Employment and Training Administration

within Labor, congressional committees, veterans service organizations,

and the Interstate Conference of Employment Security Agencies. No

specific reference to the Department of Veterans Affairs as a stakeholder

is included in the draft plan.

The draft plan identifies goals and objectives for each element of its

mission: enforcement, employment and training assistance, public

information services, interagency liaison, and training. But it notes that the

greatest challenge faced by VETS in implementing GPRA is setting forth

appropriate outcome measures for the public employment service

agencies. One reason for this difficulty, the plan notes, is that

technological advances are changing the labor exchange environment as

more employers and job seekers use personal computers, electronic

bulletin boards, and websites to announce job openings and apply for jobs.

Without the opportunity to register job seekers, the public employment

service system loses its ability to measure the numbers of individual job

seekers who benefit from its services. As a result, whereas in the past VETS

relied on a relatively simple measure of “priority”—comparison of the

rates of service achieved for registered veterans with the rates achieved

for registered nonveterans—such measures will no longer completely

reflect the actual services provided if a significant number of users are not

being registered and counted. As a partial response to this challenge, VETS

is proposing to measure results through population sampling and

postservice studies as well as data collected at the employment service

office.

The new set of measures for employment and training services continues

to reflect a mixture of activity measures, such as “received counseling or

Page 6 GAO/T-HEHS-97-129
Veterans’ Employment and Training Service:

Focusing on Program Results to Improve

Agency Performance

vocational guidance,” and results measures, such as “entered

employment.” New measures, however, go beyond measures of immediate

outcome to include the average wage of those who entered employment

and a 2-year follow-up measure.

In addition to comparing the results for veterans with those for

nonveterans, the plan describes measures that apparently will be tracked

for veterans independent of the results for nonveterans. This focus would

allow VETS to emphasize providing services that lead to high levels of

results for veterans in all locations, without setting a lower standard for

the results expected for veterans in states with a less effective

employment service.

Conclusions The draft plan represents an improvement over the current employment

and training performance measures, because the performance measures in

the plan put a greater emphasis on results and will provide information on

absolute levels of performance for veterans as well as a comparison with

nonveterans. But VETS still must collect the necessary performance data

and use that information to focus its efforts on improving the results of its

activities. Strong commitment of the political and senior career leadership

will be essential to ensure that the agency’s strategic planning and

performance measurement efforts will become the basis for its day-to-day

operations.

Mr. Chairman, this concludes my prepared statement. I will be happy to

answer any questions that you or members of the Subcommittee may have.

Contributors For more information on this testimony, please contact Sigurd R. Nilsen at

(202) 512-7003 or Betty S. Clark at (617) 565-7524. Denise D. Hunter also

contributed to this statement.

(205343) Page 7 GAO/T-HEHS-97-129
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