Millions Can Be Saved by Improving the Productivity of State and Local Governments Administering Federal Income Maintenance Assistance Programs

AFMD-81-51: Published: Jun 5, 1981. Publicly Released: Jun 5, 1981.

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GAO reviewed three State-administered Federal income maintenance programs whose administrative costs are fully paid or shared by the Federal Government: the Unemployment Insurance (UI), Aid to Families with Dependent Children (AFDC), and Food Stamp programs. The objective of the review was to demonstrate that many opportunities exist for improving productivity in State and local management of Federal income maintenance programs and that these improvements can reduce costs and improve efficiency and enhance program effectiveness. In addition, changes needed in these Federal assistance programs to promote productivity improvement were identified.

GAO identified potential savings of millions of dollars associated with the use of inefficient procedures by State and local governments administering these programs. Federal methods for allocating and distributing funds in the income maintenance assistance programs reviewed neither reward nor encourage productivity improvements. Instead, these systems serve primarily as mechanisms for justifying how limited resources are allocated to the States with little, if any, regard as to how efficiently these resources are used. Neither the Department of Health and Human Services (HHS) nor the Department of Agriculture has implemented approaches to help States determine staff needs or control administrative spending in the AFDC and Food Stamp programs. The Department of Labor has established the Cost Model Management System in an effort to make UI program administration more efficient, control administrative costs, and provide technical assistance to the States. Although conceptually sound, poor management, weak budget controls, and a lack of incentives undermine the system, causing it to fall far short of its goals. Few Federal assistance programs have systems to measure and improve productivity. Moreover, the Federal assistance system generally provides no incentive to States or their employees to improve productivity. The Office of Management and Budget and the Office of Personnel Management are taking the lead in efforts to better coordinate Federal assistance policies and to improve private sector productivity.

Recommendations for Executive Action

  1. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Secretaries of Health and Human Services and Agriculture should use the data generated by those systems to allocate administrative funds to States.

    Agency Affected: Department of Agriculture

  2. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Secretaries of Health and Human Services and Agriculture should use the data generated by those systems to allocate administrative funds to States.

    Agency Affected: Department of Health and Human Services

  3. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Director of the Office of Management and Budget should develop, with the assistance and support of the Office of Personnel Management, an interagency program to explore the potential for establishing incentive systems in Federal assistance programs for State and local governments. Participants in this effort should include representatives from State and local governments and appropriate public interest groups.

    Agency Affected: Executive Office of the President: Office of Management and Budget

  4. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Director of the Office of Personnel Management should place priority on efforts to assist State and local governments develop measurement and incentive programs for individuals and managers to improve their administration of Federal assistance programs.

    Agency Affected: Office of Personnel Management

  5. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Director of the Office of Personnel Management should work with Federal agencies, overseeing assistance programs that are administered by State and local governments, to improve and monitor those agencies' technical assistance efforts in productivity improvement.

    Agency Affected: Office of Personnel Management

  6. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Secretaries of Labor, Health and Human Services, and Agriculture should seek authority from Congress to develop and fund demonstration projects testing approaches for providing States incentives for making productivity improvements in the Unemployment Insurance, Aid to Families with Dependent Children, and Food Stamp programs.

    Agency Affected: Department of Agriculture

  7. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Secretaries of Labor, Health and Human Services, and Agriculture should seek authority from Congress to develop and fund demonstration projects testing approaches for providing States incentives for making productivity improvements in the Unemployment Insurance, Aid to Families with Dependent Children, and Food Stamp programs.

    Agency Affected: Department of Health and Human Services

  8. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Secretaries of Labor, Health and Human Services, and Agriculture should seek authority from Congress to develop and fund demonstration projects testing approaches for providing States incentives for making productivity improvements in the Unemployment Insurance, Aid to Families with Dependent Children, and Food Stamp programs.

    Agency Affected: Department of Labor

  9. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Secretaries of Labor, Health and Human Services, and Agriculture should report to the Office of Management and Budget on successful incentive systems for State and local governments so that effective incentives can be shared and transferred to other assistance programs.

    Agency Affected: Department of Agriculture

  10. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Secretaries of Labor, Health and Human Services, and Agriculture should report to the Office of Management and Budget on successful incentive systems for State and local governments so that effective incentives can be shared and transferred to other assistance programs.

    Agency Affected: Department of Health and Human Services

  11. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Secretaries of Labor, Health and Human Services, and Agriculture should report to the Office of Management and Budget on successful incentive systems for State and local governments so that effective incentives can be shared and transferred to other assistance programs.

    Agency Affected: Department of Labor

  12. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Secretary of Labor should take actions necessary to correct deficiencies in the Cost Model Management System and to refine the system as a productivity improvement program. Corrective actions needed include (1) improving control over both the cost model studies and operational and cost improvement projects and (2) using the system in the budget process.

    Agency Affected: Department of Labor

  13. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Secretaries of Labor, Health and Human Services, and Agriculture should work with States, through technical assistance programs, to eliminate inefficient procedures and identify other opportunities for improving the productivity in administering these programs.

    Agency Affected: Department of Agriculture

  14. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Secretaries of Labor, Health and Human Services, and Agriculture should work with States, through technical assistance programs, to eliminate inefficient procedures and identify other opportunities for improving the productivity in administering these programs.

    Agency Affected: Department of Health and Human Services

  15. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Secretaries of Labor, Health and Human Services, and Agriculture should work with States, through technical assistance programs, to eliminate inefficient procedures and identify other opportunities for improving the productivity in administering these programs.

    Agency Affected: Department of Labor

  16. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Secretaries of Health and Human Services and Agriculture should develop and implement systematic approaches to measure, analyze, and improve the productivity of State and local governments administering the Aid to Families with Dependent Children and Food Stamp programs.

    Agency Affected: Department of Agriculture

  17. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Secretaries of Health and Human Services and Agriculture should develop and implement systematic approaches to measure, analyze, and improve the productivity of State and local governments administering the Aid to Families with Dependent Children and Food Stamp programs.

    Agency Affected: Department of Health and Human Services

  18. Status: Closed

    Comments: GAO has no information on the actions taken in response to this recommendation.

    Recommendation: The Director of the Office of Management and Budget should require, where appropriate through the budget process, that Federal agencies develop systematic approaches to help State and local governments improve their productivity in administering Federal assistance programs and that agencies use the data generated by these systems to justify future budget requests.

    Agency Affected: Executive Office of the President: Office of Management and Budget

 

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