It is impossible to fully understand the purpose of the Government Performance and Results Act without understanding the environment within which the law was drafted, debated, and enacted with strong bipartisan support. That declaration signaled the end of a 30-year period in which the federal government expanded its activities to address a broad range of problems. During that period, the federal government regularly spent more than it received in revenue. The declining discretionary portion of the budget has caused Congress to require federal agencies to focus more on improving their performance and demonstrating that they are supporting effective programs that are important to the American people. The Director of the Office of Management and Budget has stated, This is an era of fiscal limits.
Resources are scarce.
Not every priority can be met, nor all needs satisfied. Every program must count. Within the discretionary spending cap, choices about which programs receive funding increases, remain level funded, or shrink, should increasingly be governed by performance. Many government programs could receive less funding each year than was appropriated during the preceding year. Even for the few agencies, like the U.S. Department of Education, that are expected to receive increases, the need to demonstrate program effectiveness is a condition of continued funding.