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642CG entitled 'Improving Performance, Transparency, and Accountability 
Through Use of Key National Indicators' which was released on March 19, 

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United States Government Accountability Office: 

Improving Performance, Transparency, and Accountability: 

Through Use Of Key National Indicators: 

The Honorable David M. Walker: 
Comptroller General of the United States: 

OECD Workshop on Indicators for Developing, Monitoring, and Analyzing 
Agri-Environmental Policies: 

The Case for Change: 

The U.S. federal government is on a "burning platform," and the status 
quo way of doing business is unacceptable for a variety of reasons, 

Past fiscal trends and significant long-range challenges: 

Rising public expectations for demonstrable results and enhanced 

Selected trends and challenges having no boundaries: 

Additional resource demands due to Iraq, Afghanistan, incremental 
homeland security needs, and recent natural disasters in the United   

Numerous government performance/accountability and high risk 

Outdated federal organizational structures, policies, and practices: 

Current U.S. Fiscal Policy Is Unsustainable: 

The "Status Quo" is Not an Option: 

* We face large and growing structural deficits largely due to known 
demographic trends and rising health care costs. 

* GAO's simulations show that balancing the budget in 2040 could 
require actions as large as: 

- Cutting total federal spending by 60 percent or: 

- Raising federal taxes to 2 times today's level: 

Faster Economic Growth Can Help, but It Cannot Solve the Problem: 

* Closing the current long-term fiscal gap based on reasonable 
assumptions would require real average annual economic growth in the 
double digit range every year for the next 75 years. 

* During the 1990s, the economy grew at an average 3.2 percent per 

* As a result, we cannot simply grow our way out of this problem. Tough 
choices will be required. 

The Way Forward: A Three-Pronged Approach: 

1. Improve Financial Reporting, Public Education, and Performance 

2. Strengthen Budget and Legislative Processes and Controls: 

3. Engage in Fundamental Reexamination & Transformation for the 21St 
Century (i.e., entitlement programs, other spending, and tax policy): 

Solutions Require Active Involvement from both the Executive and 
Legislative Branches: 

Improving Performance Metrics & Reexamining Existing Programs: 

Develop key national indicators to measure progress toward national 
outcomes, assess conditions and trends, and help communicate complex 
issues. Some other countries have key national indicator systems, but 
not the United States: 

Expand scrutiny of all proposed new programs, policies, or activities: 

Reengineer internal agency structures and processes, including more 
emphasis on long-term planning, integrating federal activities, and 
partnering with others both domestically and internationally: 

The Need For Key National Indicators in the U.S. 

Federal spending exceeds $2.7 trillion annually: 

Federal revenues reduced by more than $800 billion in tax preferences: 

Agencies produce reams of regulations: 

Most federal government policies and programs were created years ago: 

What: A portfolio of economic, social, and environmental outcome-based 
measures that could be used to help assess the nation's and other 
governmental jurisdictions' position and progress: 

Who: Many countries and several states, regions, and localities have 
already undertaken related initiatives (e.g., Australia; New Zealand; 
Canaa; United Kin Kingdom; Ore on; Silicon Valley (California); 
Jacksonville (Florida; Boston on; 

Why: Development of such a portfolio of indicators could have a number 
of possible benefits, including: 

* Serving as a framework for related strategic planning efforts: 

* Enhancing performance and accountability reporting: 

* Informing public policy decisions, including much needed baseline 
reviews of existing government policies, programs, functions, and 

* Facilitating public education and debate as well as an informed 

Way Forward: Key players working through a consortium within a 
nonprofit organization receiving technical assistance from the National 
Academies domestically and OECD and others providing assistance 
internationally on related efforts: 

Key National Indicators: Where the United States Ranks: 

The United States may be the only superpower, but compared to most 
other OECD countries on selected key economic, social, and 
environmental indicators, on average, the U.S. ranks: 

16 0ut Of 28: 

OECD Categories for Key Indicators (2006 OECD Factbook): 

* Population/Migration; 
* Energy; 
* Environment; 
* Quality of Life. 
* Macroeconomic Trends; 
* Labor Market; 
* Education; 
* Economic Globalization;  
* Prices; 
* Science & Tech; 
* Public Finance. 

Source: 2006 OECD Factbook. 

[End of table] 

The Key National Indicators Initiative: 

GAO's work has pointed to the need for a governmentwide strategic plan, 
supported by key national indicators to assess performance, position, 
and progress: 

GAO has also called for a governmentwide performance report linked to 
key indicators to articulate the government's accomplishments: 

The Key National Indicators Initiative has begun efforts to develop a 
national indicator system that could: 

Inform strategic planning: 

Enhance performance and accountability reporting: 

Inform congressional oversight and decision making: 

Facilitate oversight, and stimulate greater citizen engagement: 

The Benefits of Key National Indicators: 

With access to solid facts and results-based information, we increase 
our chances of: 

Developing well-framed questions: 

Conducting appropriate analyses: 

Making good decisions: 

Arriving at effective solutions: 

Creating transparency and accountability for results: 

Bottom line: By adopting key national indicators, we'll be able to 
generate quality information that can help individuals, institutions, 
and nations accelerate progress and make better choices when it comes 
to their futures: 

Criteria for Key National Indicators: 

Achieving success in developing key national indicator systems will 
require the combined efforts of many parties overtime: 

Any key national system's design should incorporate indicators that 

Reasonably comprehensive; 

[End of table] 

Key National Indicators: Supreme Audit Institutions Are Well Positioned 
to Help: 

Accountability Organization Maturity Model: 

Facilitating Foresight: 
Increasing Insight: 
Enhancing Economy Efficiency, Ethics, Equity, and Effectiveness: 
Assuring Accountability: 
Combating Corruption: 

Source: GAO. 

[End of Model] 

The Role of SAls & International Organizations in Developing Indicator 

International organizations, such as DECD and INTOSAI have begun 
actively promoting the development and application of key indicators: 

The U.N., World Bank, INTOSAI, INCOSAI, and OECD have held or are 
planning forums on indicator systems (e.g., Palermo, Italy in November 
2004 and Istanbul, Turkey in n June 2007): 

GAO has played a significant role in fostering the development of 
indicators domestically: 

GAO Reports Related to Key National Indicators: 

On February 27, 2003, GAO, in cooperation with the National Academies, 
hosted a forum and published: Forum on Key National Indicators: 
Assessing the Nation's Position and Progress (GAO-03- 672SP): 

On November 10, 2004, GAO published: Informing Our Nation: Improving 
How to Understand and Assess the USA's Position and Progress (GAO-05- 

On November 17, 2004, GAO published: Environmental Indicators: Better 
Coordination Is Needed to Develop Environmental Indicator Sets That 
Inform Decisions (GAO-05-52): 

GAO Findings Related to Key Environmental Indicators: 

GAO has consistently reported on the: 

Lack of quality information needed to understand the state of the 
nation's environment: 

Extent of compliance by the regulated community , and the need to 
consider the full costs and benefits associated with alternative 
regulatory and management strategies in policymaking: 

Outcome-based information is needed to help inform environmental cost/ 
benefit analysis. Without this kind of information, the nation's 
environmental policy and priorities will continue to be driven by 
anecdote and perception, rather than fact: 

GAO found that federal and nonfederal organizations develop 
environmental indicator sets for several purposes: 

* Assessing conditions and trends: 

* Communicating complex issues: 

* Supporting performance management activities: 

Environmental indicator set developers commonly face several major 

* Employing a sound, balanced process to develop indicators, which can 
require a resource-intensive effort to address the needs of potential 

* Obtaining sufficient data on environmental conditions and their 

* Coordinating and integrating the various related federal and non- 
federal indicator sets to advance knowledge about the nation's 

* Linking management actions and program activities to changes in 
environmental conditions and trends: 

GAO has recommended that USDA use information from indicators to better 
manage its agricultural conservation programs: 

Recently, GAO evaluated the Environmental Quality Incentives Program 
(EQIP) which provides assistance to farmers to take new actions aimed 
at addressing identified conservation problems: 

GAO reported that USDA should: 

* Use outcome-based environmental indicators to drive decision making 
to target funds to the most pressing environmental problems related to 

* Tie programs' long-term outcomes to environmental indicators so that 
USDA can communicate program results: 

21st Century Challenges Report: 

Provides background, framework, and questions to assist in reexamining 
the base: 

Covers entitlements & other mandatory spending, discretionary spending, 
and tax policies and programs: 

Based on GAO's work for the Congress: 

Source: GAO. 

Twelve Reexamination Areas: 

Mission Areas: 

* Defense; 
* International Affairs; 
* Education & Employment; 
* Natural Resources, Energy & Environment; 
* Financial Regulation & Housing; 
* Retirement & Disability; 
* Health Care; 
* Science & Technology; 
* Homeland Security; 
* Transportation; 

Crosscutting Areas: 

* Improving Governance; 
* Reexamining the Tax System: 

Illustrative 21st Century Questions: Natural Resources,, Energy, and 
the Environment: 

Can alternative federal approaches to transportation, land management, 
and water policies be adjusted to better promote sustainable management 
of our nation's land and water resources? 

To what extent are federal energy policies and incentive structures 
adequately preparing the nation to satisfy its energy needs over the 
long term? 

Does the existing federal regulatory approach for controlling air and 
water pollution need to be modernized to generate improved results? 

Is there a way for the federal government to implement environmental 
regulations more efficiently and effectively? 

Next Steps in the U.S.: Suggested Areas for Congressional Oversight: 

Targets for near-term oversight (e.g., ensuring the fair value 
collection of oil royalties produced from federal lands): 

Policies and programs that are in need of fundamental reform and re- 
engineering (e.g., examining the costs, benefits, and risks of key 
environmental issues): 

Governance issues that should be addressed to help ensure an 
economical, efficient, effective, ethical, and equitable federal 
government capable of responding to the various challenges and 
capitalizing on related opportunities in the 21 st century (e.g., 
pursuing the development of key national indicators): 

Suggested Congressional Oversight Related to Environment Indicators: 

Assessing implementation of laws and compliance, as well as 
opportunities for enhancing the cost-effectiveness and efficiency of 
environmental programs: 

Identifying information needed to better assess the state of the 
environment, emerging problems, and social and economic impacts of 
environmental programs: 

Prioritizing activities to fill knowledge gaps and strengthen the 
information needed for assessing existing and emerging environmental 
risks, as well as evaluating the costs and benefits of alternative 
approaches to achieving environmental outcomes: 

Determining whether changes to statutes and regulations could help 
ensure that the nation's environmental, social, and economic goals are 
being achieved in a balanced and sustainable manner: 

Encouraging awareness and education through public hearings: 

Strengthening partnerships to enhance the dissemination of quality 

Focusing attention on the role and contributions of the federal 
statistical system in providing key data and assessing areas where 
improvements are needed: 

Examining the possible role of a public-private partnership to further 
develop and operate a system of key national indicators: 

Key Leadership Attributes Needed for These Challenging and Changing 


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Paul Anderson, Managing Director, Public Affairs 
(202) 512-4800: 

U.S. Government Accountability Office 441 G Street NW, Room 7149 
Washington, D.C. 20548: 


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