GPRA is intended to shift the focus of government decision-making, management, and accountability from activities and processes to the results and outcomes achieved by federal programs. New and valuable information on the plans, goals, and strategies of federal agencies has been provided since federal agencies began implementing GPRA. Under GPRA, annual performance plans are to clearly inform the Congress and the public of (1) the annual performance goals for agencies’ major programs and activities, (2) the measures that will be used to gauge performance, (3) the strategies and resources required to achieve the performance goals, and (4) the procedures that will be used to verify and validate performance information. These annual plans, issued soon after transmittal of the president’s budget, provide a direct linkage between an agency’s longer-term goals and mission and day-to-day activities. Annual performance reports are to subsequently report on the degree to which performance goals were met. The issuance of the agencies’ performance reports, due by March 31, represents a new and potentially more substantive phase in the implementation of GPRA—the opportunity to assess federal agencies’ actual performance for the prior fiscal year and to consider what steps are needed to improve performance and reduce costs in the future. OPM’s mission is to support the federal government’s ability to have the best workforce possible to do the best job possible. OPM is to accomplish this mission by leading federal agencies in shaping human resources management systems to effectively recruit, develop, manage, and retain a high-quality and diverse workforce; protecting national values embodied in law, including merit principles and veterans’ preference; serving federal agencies, employees, retirees, their families, and the public through technical assistance, employment information, pay administration, and benefits delivery; and safeguarding employee benefit trust funds. The results of OPM’s efforts largely take place at federal agencies outside of the direct control of OPM. This section discusses our analysis of OPM’s performance in achieving its selected key outcomes and the strategies it has in place, particularly strategic human capital management and information technology, for accomplishing these outcomes. In discussing these outcomes, we have also provided information drawn from our prior work on the extent to which the agency provided assurance that the performance information it is reporting is credible. We cannot assess progress made by OPM in contributing to the outcome that the federal government has an appropriately constituted workforce with the proper skills to carry out its missions. OPM has several goals that relate to this outcome, but none that focus squarely on the degree to which the federal workforce has the right skill mix. Specifically, OPM’s fiscal year 2000 performance report includes goals that “federal human resources management policies and programs are merit-based, mission- focused, and cost effective” and “a model for workforce planning . . . is in place” for use by agencies. OPM’s performance report states that both of these goals were met. OPM states that the first goal was met because it produced a few studies that contributed to human resource policy or program proposals. The second goal was met, according to the OPM fiscal year 2000 performance report, because OPM has provided the workforce planning model to several agencies. This model, and other important steps OPM has taken to support better workforce planning—including developing research tools and launching a website to facilitate information sharing about workforce planning issues—could prove helpful to agencies in addressing their individual strategic human capital challenges. As a next step, OPM needs to measure, for example, how the studies and workforce planning model actually contributed to improved strategic human capital management at the agencies. Specifically, as an intermediate outcome, OPM could measure the number of agencies that were able to identify skill shortages and solutions as a result of using workforce planning. Previously, we have reported that OPM should take a more proactive role in agency workforce planning efforts, and our April 2001 report on expected trends in federal employee retirements further highlights the need for improved workforce planning. Other information indicates that this outcome is not commonly being achieved. Our high-risk series gave many examples of agencies not having the appropriate workforce to carry out its mission. For example, the Department of Energy did not have employees with adequate contract management skills to oversee the clean up of hazardous waste sites, and nursing shortages at Veterans Affairs facilities could put veterans at risk. OPM’s fiscal year 2002 plan contains several strategies that, for the most part, appear to be reasonable. For example, OPM plans to obtain input from agencies on how workforce policies need to be changed and to explore policies on dual compensation and phased retirement to bolster retention of federal employees. Determining whether these strategies are successful will require OPM to develop indicators of whether federal agencies and departments have appropriately skilled workforces and how these strategies are being used to build workforce skills. As is the case with the first outcome, OPM’s performance report does not contain sufficient outcome measures to fully assess the extent to which federal employees are held accountable for their performance. OPM’s performance report contains several goals related to this outcome. For example, OPM is to develop performance-oriented approaches to employee compensation and to provide assistance in developing performance management systems. OPM measures goal achievement by such indicators as the number of workshops offered, the number of performance studies available on the OPM Website, and whether performance management guidance is issued in a timely manner. Other information indicates that much more needs to be done to improve performance management at federal agencies. For example, in our October 2000 report, we noted that surveys we had administered to managers showed that only 26 percent in 1997 and 31 percent in 2000 reported that employees in their agencies had received positive recognition to a great or very great extent for helping agencies accomplish their strategic goals. Also, the Merit Systems Protection Board (MSPB) and we have previously reported that holding employees accountable for their job performance continues to be perceived as a challenge because employees perceive the process as cumbersome. OPM’s plan identifies a variety of strategies for achieving goals that relate to the outcome of evaluating, rewarding, and otherwise holding federal employees accountable for their performance. The strategies call for providing guidance and information to agencies, including information on best practices, as well as working with internal and external stakeholders to identify needed changes in compensation and performance policies and programs. Although the strategies appear reasonable, how they will help to achieve the outcome of holding employees accountable for performance is not always clear. For example, a strategy OPM cited to help achieve its goal of identifying options for performance-oriented approaches to compensation was to maintain comprehensive research on best practices in private and public sector compensation systems and tools that the federal government can use. But OPM offers no explanation of how the use of such systems and tools will aid the federal government in holding employees accountable for their performance. OPM has made mixed progress on the outcome that federal agencies adhere to merit system principles. On the one hand, OPM’s fiscal year 2000 performance report states that OPM’s periodic reviews of agencies have identified no systemic merit principle weaknesses. On the other hand, the results of OPM’s government-wide survey of federal employees conducted in fiscal years 1999 and 2000 indicate that a sizable percentage of employees think that certain merit principles are not being followed. The fiscal year 2000 performance report includes goals related to the overall adherence to merit principles by agencies, including agencies with delegated examining authority. OPM uses a variety of measures to determine if this outcome is being achieved, including (1) the results of merit system reviews of federal agencies, (2) agencies’ satisfaction with the reviews, and (3) the views of federal employees regarding adherence to merit principles. OPM’s report states that the reviews indicated that agencies, including those with delegated examining authority, were adhering to merit principles. According to the performance report, the problems found in OPM’s reviews were not systemic. Once problems were identified in the review, OPM worked with the agency to resolve the problems. In its reviews, OPM also identified best practices and shared them with other agencies. The views of federal employees on adherence to the nine merit system principles, as provided in an OPM survey, indicated that there was no significant change from the fiscal year 1999 survey. OPM’s goal was to increase by two percentage points the percentage of federal employees who believed each of the merit principles were being adhered to by their agencies. There are a variety of factors that influence employees’ responses to this question, including governmentwide economic, cultural, and social conditions. For this reason, OPM expects substantive change in the perceptions of these principles to take place over several years. This year’s survey indicates that a relatively large portion of federal employees believed that employees maintain a high standard of integrity and concern for the public and that employees are protected from improper political influence. But on the other hand less than half believe that employees are protected against reprisal for the lawful disclosure of information or are provided equal pay for equal work and rewarded for excellent performance; and only a little more than half think that employees are managed efficiently and effectively. Similar results were reported in the merit system principles survey conducted by MSPB in 2000. OPM’s fiscal year 2002 performance plan identifies a variety of strategies that are consistent with its current efforts. The current strategies should help OPM achieve its goals as well as contribute to the outcome of ensuring that agencies adhere to the merit system principles. For example, to help ensure that personnel practices are carried out in accordance with these principles, OPM’s strategies include conducting nationwide agency merit system oversight reviews, auditing agencies with delegated examining authority and reviewing reports filed by these agencies to identify any training needs, and reviewing all agency selections for initial career Senior Executive Service appointments for compliance with merit system principles. OPM does not include coordination with MSPB as a strategy for achieving performance goals within its Office of Merit Systems Oversight and Effectiveness—the program office that is responsible for leading the federal government’s efforts in overseeing the merit system. MSPB’s mission, in part, is to ensure that agencies make employment decisions in accordance with the merit system principles. In support of its mission, MSPB hears and decides cases involving abuses of the merit system. It also administers the merit principles survey to gather data on the “health” of the federal civil service. OPM’s strategy should also consider MSPB’s decisions and merit principles survey in helping to achieve this outcome. However, even though both agencies administer programs and conduct similar activities that share a common purpose, OPM’s strategic plan for fiscal years 2000 through 2005 states that coordination with MSPB is limited to adjudicatory issues. We could not fully assess the progress OPM is making to reduce fraud and error in the Federal Employees Health Benefits Program. The OPM OIG has identified health care fraud in the Federal Employees Health Benefits Program as one of the most serious management challenges facing OPM. The fiscal year 2000 performance report contains an OIG goal to have fraud against OPM programs detected and prevented. This goal has several measures, including the number of convictions for health benefit program fraud (51 in fiscal year 2000) and the number of health benefit providers who are debarred and not allowed to participate in the Federal Employees Health Benefits Program (2,706 in fiscal year 2000). Although these are measures for the OIG, there were no goals or strategies related to the detection and prevention of fraud at the programmatic level for the Federal Employees Health Benefits Program in the Office of Retirement and Insurance Service (RIS), whose mission, in part, is to provide accurate and cost-efficient benefit services. For example, there were no goals or strategies to decrease the number of errors or fraud cases to a minimum. In addition, there were no baseline indicators of the dollar amount of fraud or errors found in the health benefits program or quantitative targets against which to measure progress. OPM believes that measures identified by the OIG are consistent with RIS’ expectations and says that RIS has worked in unison with the OIG to minimize fraud and abuse in the Federal Employees Health Benefits Program. While we recognize this, we believe that OPM needs to develop goals and measures within RIS for detecting and preventing fraud and errors in the health benefits program. The fiscal year 2002 performance plan contains a strategy to have the employee benefit trust funds be models of excellence and integrity in financial stewardship. The OIG includes strategies related to reducing fraud and errors, such as pursuing debarment of untrustworthy health care providers and conducting aggressive investigations where fraud and abuse are suspected, which seem reasonable. The RIS had no goals or performance indicators related to fraud and errors in the health benefits program, but included strategies such as (1) working with carriers participating in health benefits to ensure that audits are performed and (2) conducting financial statement audits to reduce the incidence of payment errors, which in part will help detect fraud and errors in the health benefits program. Although these strategies generally will help detect and reduce fraud and errors, it is unclear how this will be accomplished and how they plan to measure progress because there were no baseline indicators for the dollar amount of fraud or errors found in the health benefits program, or performance indicators against which to measure progress. In addition, performance indicators for the OIG measured progress in processing cases (debarments, indictments, and convictions) once the fraud is discovered but did not address measures for preventing it. The fiscal year 2000 performance report describes mixed progress in the provision of timely and accurate retirement and insurance services. OPM’s retirement and insurance program continues to receive high satisfaction ratings from its customers, but timeliness of retirement claims processing has declined. The fiscal year 2000 performance report outlines several outcome-oriented goals that include increasing customer satisfaction with services and reducing processing times. Customer satisfaction with OPM’s retirement and insurance programs remained high during fiscal year 2000. For example, more than 90 percent of new retirees said they were very or generally satisfied with how their claims were handled. Claims processing times, however, did not meet target levels, particularly the time to process Federal Employees Retirement System (FERS) claims. Specifically, Civil Service Retirement System (CSRS) claims processing time increased to 44 days from 32 days in fiscal year 1999 and FERS processing time increased to more than 6 months from 3 months in fiscal year 1999. The goal for CSRS processing time is 25 days and for FERS processing time is 60 days. OPM recognizes that it needs to address lagging times in retirement claims processing, and the fiscal year 2002 performance plan contains strategies that could improve claims processing timeliness. The plan states that the current processing is based on “aging technology, paper-based business processes, and a heavy reliance on human resources.” One of the strategies cited in OPM’s plan for reducing claims processing times is to add more resources to the processing of FERS claims. OPM’s measure of its success in achieving this goal is to gradually reduce processing times for these claims from a fiscal year 2000 level of 6 months to 5 months in fiscal year 2001 and 3 months in fiscal year 2002. The number of FERS claims is expected to increase by nearly 40 percent between fiscal year 2000 and fiscal year 2002. The number of employees seeking retirement services is expected to dramatically increase beyond 2002. To address long-term needs, OPM is implementing a Retirement Systems Modernization project that is expected to significantly reengineer and automate retirement claims processing. OPM is implementing the modernization of the retirement systems in phases and expects to realize significant business benefits each year. OPM says it has already seen improvements. For example, OPM says it implemented a prototype FERS Benefit Calculator that has helped to reduce processing times and the balance of aged cases. However, the modernized retirement systems will not be fully operational until 2009. Reducing claims processing times with an increasing workload will be a significant challenge for OPM. OPM has made some improvements to its fiscal year 2000 performance report and fiscal year 2002 performance plan over previous years. However, a number of weaknesses continue that OPM recognizes. This section describes improvements and remaining weaknesses in OPM’s (1) fiscal year 2000 performance report in comparison with its fiscal year 1999 report, and (2) fiscal year 2002 performance plan in comparison with its fiscal year 2001 plan. OPM’s fiscal year 2000 performance report represents an improvement over the fiscal year 1999 report, but opportunities remain for additional improvements. In our June 2000 report we indicated that OPM’s fiscal year 1999 performance report did not identify the most critical performance measures towards goal achievement. The fiscal year 2000 report clearly identifies the most critical measures of the several measures that are included under most goals. If the critical indicator was met, then OPM considered the goal met. Last year we noted a number of performance report weaknesses, including the use of activity-based indicators instead of outcome-based indicators and the lack of specific target measures for goals. Again for fiscal year 2000, many indicators are activity based or do not contain specific targets. The following are examples of activity-based measures or those without targets: To determine whether delegated examining is conducted in accordance with merit system laws, OPM measured the number of reviews conducted of agency-delegated examining activities. An OPM measure is to ensure that the OPM workforce is well trained for current and future needs; however, there is no target identified to determine when this has been achieved. In measuring customer or employee satisfaction, OPM uses terms such as “high degree” of satisfaction without defining what constitutes a “high degree” of satisfaction. OPM does not identify which positive feedback rate (e.g., 80 percent or 90 percent) is judged to be “high satisfaction” for the particular indicator. A performance management goal is for OPM to formulate performance- oriented approaches to compensation. OPM considered this goal met because it disseminated information on state-of-the-art compensation practices. Even though these measures indicate positive activity, they are not measures of actual goal achievement, and without specific targets it is not possible to determine whether the goal was met. The fiscal year 2000 performance report also contains some measures that were not considered reliable by the OPM OIG. The performance report states that the Inspector General reviewed 116 of the 458 performance measures and found that 59 percent were based on reliable information and 17 percent were based on unreliable information; for 24 percent of the measures, the OIG could not determine their reliability. Further, concerns exist about the reliability of key surveys that are used by OPM as measures for goal achievement throughout the performance report. The low participation rates for the current Human Resources Directors’ Survey and the earlier Human Resources Specialists Survey (which was not conducted in fiscal year 2000) pose a material risk that the respondents may not be representative of the overall survey population. In addition, in the case of the Human Resources Directors’ Survey, the low participation rate caused a margin of error of 9.9 percent, limiting the usefulness of the results. The fiscal year 2002 performance plan continues with several of the strengths of the 2001 plan. The plan is directly linked to the OPM strategic plan and is integrated with the OPM Congressional Budget Justification. The plan also includes a resource summary by major OPM strategic goal, including the dollars and full-time equivalents requested by goal. The fiscal year 2002 plan, like the fiscal year 2000 report, contains a number of OPM activity-based, rather than outcome-based, goals and measures or indicators. The fiscal year 2002 plan continues to rely on the results of some governmentwide surveys and secondary anecdotal information to measure whether target levels established in the previous years’ plans have been met. The 2002 plan discusses steps that OPM will take to address some of the weaknesses with these surveys and anecdotal information. For example, OPM states in its 2002 plan that it discontinued several indicators that were based on unreliable data sources. The reliability and validity of informal feedback has inherent limitations that cannot be made more reliable and statistically valid by the planned enhancement of procedures to collect and track the information. OPM is proceeding with the implementation of a new measurement framework. It plans to conduct more formal evaluations of the outcomes of specific policies and programs, identify agency-level performance measures, use agency-level measures as the primary basis of performance reporting, and tie the measures more closely to the strategic goals. This section discusses the extent to which OPM is internally addressing strategic human capital management and information security. Both OPM’s performance report, as well as its plan, address these challenges within the agency. Regarding OPM’s internal strategic human capital management, we found that the fiscal year 2002 performance plan contains several goals and measures related to OPM’s internal strategic human capital management, and OPM’s fiscal year 2000 performance report describes progress in resolving some of these OPM-level strategic human capital management challenges. For example, both the report and the plan contained goals related to recruiting, retaining, and managing a workforce to meet OPM program needs. Of particular note was the requirement that all employee performance plans be linked to agency strategic goals and the establishment of baseline data to measure the rate of retention among employees who complete career development programs. To further improve its strategic human capital management goals and strategies, OPM needs to link these strategies to specific OPM programs. For example, the OPM performance plan states that OPM has significantly changed its ratio of employees to supervisors to now exceed the governmentwide average. OPM’s performance plan also states that it wants to further increase this ratio. The plan needs to also discuss what impact this ratio change will have on program outcomes and what additional human capital strategies might be needed to address the reduction in the number of supervisors. OPM also could establish the relationship of impending retirements to OPM succession planning processes to ensure that critical competencies and leadership are available for mission-critical activities. With respect to information security, we found that OPM’s fiscal year 2002 performance plan contains a goal and measures related to information security, and the agency’s fiscal year 2000 performance report explains its progress in resolving its information security challenges. OPM reports that in fiscal year 2000, it met its goal of ensuring that the information security program provided adequate computer security commensurate with the risk and magnitude of harm that could result from loss or compromise of mission-critical information technology systems. However, the results of the independent public accountant’s audit of OPM’s fiscal year 2000 consolidated financial statements show that a reportable condition continues to exist in the electronic data processing general control environment. The audit noted weaknesses in (1) entity-wide security, (2) access control, (3) control over application changes and software development, and (4) service continuity planning. The target date for describing the corrective action taken to resolve these deficiencies is fiscal year 2001. The fiscal year 2002 performance plan includes a goal to enhance information security. The plan states that the absence of critical security problems is the critical indicator for achieving this goal. OPM’s mission, in part, is to provide strategic human capital management leadership and services to federal agencies. OPM’s fiscal year 2000 performance report and fiscal year 2002 performance plan contain many goals that measure the extent of their activities, but there are few goals and measures that assess the actual state of strategic human capital management in the federal government or the specific contributions that OPM’s programs and initiatives make. Even though OPM does not directly control these outcomes in federal agencies, it needs to measure the results to assess how well its leadership and services are working. OPM has recognized this weakness and is working with federal department and agency human resource directors to develop a series of human capital measures. OPM also needs to make other improvements to its report and plan, including strengthening goals and measures to improve their reliability, linking its internal human capital goals to OPM programs, and establishing a program management performance goal to assess fraud and error in the Federal Employees Health Benefits Program. To better assess OPM programs, we recommend that as a part of OPM’s continued strengthening of its efforts to clearly define goals, measure its performance, and provide leadership over strategic human capital management, the Director of OPM develop goals and measures that assess the state of human capital at federal departments and agencies, replace informal feedback measures with indicators that are more reliable, and better link internal strategic human capital management goals to specific OPM programs and outcomes. In addition, we also recommend that the Director of OPM develop goals and measures that assess the prevention and detection of fraud and errors in the Federal Employees Health Benefits Program, perform a risk assessment to identify areas most vulnerable to fraud and errors, and institute internal controls to prevent and detect occurrences. Our evaluation was generally based on the requirements of GPRA, the Reports Consolidation Act of 2000, guidance to agencies from the Office of Management and Budget (OMB) for developing performance plans and reports (OMB Circular A-11, Part 2), previous reports and evaluations by us and others, our knowledge of OPM’s operations and programs, our identification of best practices concerning performance planning and reporting, and our observations on OPM’s other GPRA-related efforts. We also discussed our review with OPM officials and with OPM’s OIG. The agency outcomes that were used as the basis for our review were identified by the Ranking Minority Member, Senate Governmental Affairs Committee as important mission areas for the agency and generally reflect the outcomes for all of OPM’s programs or activities. The major management challenges confronting OPM—including the governmentwide high-risk areas of strategic human capital management and information security that we identified in our January 2001 performance and accountability series and high-risk update—were identified by us and by OPM’s OIG in December 2000. We did not independently verify the information contained in the performance report and plan, although we did draw from other GAO work in assessing the validity, reliability, and timeliness of OPM’s performance data. We conducted our review from April 2001 through June 2001 in accordance with generally accepted government auditing standards. We provided a draft of this report to OPM for its review and comment. OPM’s Acting Director provided written comments, which are reprinted in appendix II. Overall, he agreed with the results our review, including our recommendations, and appreciated our recognizing the strategic challenges OPM faces with regard to human capital management as well as its efforts to improve its measurement framework, including the shift to measuring governmentwide outcomes. OPM also provided specific comments to clarify information we presented on four of the five selected key outcomes. We made several changes to this report in response to these comments. Our responses are given in appendix II as well as in various sections of this report. As arranged with your office, unless you publicly announce its contents earlier, we plan no further distribution of this report until 30 days after the date of this letter. At that time, we will send copies to appropriate congressional committees; the Acting Director of OPM, and the Director of OMB. Copies will also be made available to others on request. If you or your staff have any questions, please call me at (202) 512-6806. Key contributors to this report were Bill Doherty, Danielle Holloman, Linda Lambert, Mary Martin, Elizabeth Martinez, Ben Ritt, Ed Stephenson, and Scott Zuchorski. Table 1 identifies the major management challenges confronting OPM, which include the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges that we and/or OPM’s OIG have identified. The second column discusses what progress, as discussed in its fiscal year 2000 performance report, OPM has made in resolving its challenges. The third column discusses the extent to which OPM’s fiscal year 2002 performance plan includes performance goals and measures to address the challenges that we and/or OPM’s OIG identified. We found that OPM’s performance report discussed the agency’s progress in resolving all challenges. Of the agency’s seven major management challenges, its performance plan had goals and measures that were directly related to all seven of the challenges. OPM can build upon its efforts by more clearly identifying the specific strategies that it is using to address its challenges. Such information is important to help OPM, the Congress, and other decisionmakers determine whether the best mix of strategies is in place and to help pinpoint improvement opportunities. The following are GAO’s comments on the specific comments contained in the enclosure to OPM’s letter dated June 26, 2001. 1. We revised this report to show that the retirement systems modernization project is being implemented in phases and that it will not be fully operational until 2009. 2. In the draft of this report provided to OPM for comment, we stated that OPM’s goal for fiscal year 2000 was to make the workforce planning model available to agencies for their use and that this goal was met. Although making the model available to agencies is a useful activity, OPM’s performance report and plan do not make clear what the outcome or result was from this activity. For example, neither document provides information on how agencies have used this model to help ensure that they have an appropriately constituted, properly skilled workforce to carry out their missions. OPM comments “there is already real evidence that the model has been of assistance, as all Federal agencies are meeting a deadline of June 29, 2001, to provide the Office of Management and Budget with individual workforce analyses as a first step in meeting the President’s initiative to use human capital planning to streamline Government.” The basis upon which OPM makes this statement is unclear, because although OPM says the workforce planning model has been of assistance to agencies, it does not say how many agencies actually used it in responding to OMB’s directive. 3. We recognize that OPM’s goal for fiscal year 2000 was to complete its research on private and public sector best practices in compensation systems and tools. However, OPM does not describe in its fiscal year 2000 performance report or 2002 performance plan what outcome or result was expected for this activity-based goal in terms of ensuring employee performance accountability. Thus, we continue to believe that OPM needs to have goals, measures, and strategies in place that will show how the use of the compensation systems and tools identified as a result of its research will aid the federal government in holding employees accountable for their performance. 4. We changed the report to recognize OPM’s belief that the measures the OIG identified for detecting fraud and error in the Federal Employees Health Benefits Program are consistent with RIS’ expectations. However, as we have stated in this report, the OIG’s measures relate to detecting fraud after it has occurred rather than preventing it. Accordingly, we continue to believe that OPM needs to develop goals and measures within the program office, RIS, for detecting and preventing fraud and errors in the health benefits program. OPM commented that it will look for ways to develop additional program- wide goals and measures relating to fraud and errors in the federal health benefits program. 5. In addition to the changes described in comment 1, we changed the report to reflect that the retirement systems modernization project has not been delayed. We also cited an example of improvements OPM has seen thus far in implementing the modernized retirement systems.

Summary: This report reviews the Office of Personnel Management's (OPM) fiscal year 2000 performance report and fiscal year 2002 performance plan. OPM's mission, in part, is to provide strategic human capital management leadership and services to federal agencies. OPM's fiscal year 2000 performance report and fiscal year 2002 performance plan contain many goals that measure the extent of their activities, but there are few goals and measures that assess the actual state of strategic human capital management in the federal government or the specific contributions that OPM's programs and initiatives make. Although OPM does not directly control these outcomes in federal agencies, it needs to measure the results to assess how well its leadership services are working. OPM recognizes this weakness and is working with human resource directors at federal agencies to develop a series of human capital measures. In its report and plan, OPM also need to strengthen goals and measures to improve their reliability, link its internal human capital goals to OPM programs, and establishing a program management performance goal to assess fraud and error in the Federal Employees Health Benefits Program.