Postal Service:

Final Report on Compliance With the 1988 Budget Reduction Mandate

GGD-89-25: Published: Oct 31, 1988. Publicly Released: Oct 31, 1988.

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Pursuant to a legislative requirement, GAO determined whether the Postal Service (USPS) complied with Omnibus Budget Reconciliation Act of 1987 requirements to: (1) reduce its operating costs by $160 million in fiscal year (FY) 1988 and $270 million in FY 1989; and (2) make corresponding payments to the Federal Employees Health Benefits Program.

GAO found that USPS: (1) adopted 10 cost-savings initiatives that reduced its operating budget allocations by $173 million; (2) carried out related cost reduction initiatives that produced more than $188 million in documented savings; (3) generally complied with the act even though its overall costs exceeded budgeted levels; (4) implemented cost-savings initiatives covering about $98 million of its initial $173.8 million goal and produced savings that significantly exceeded planned savings in field personnel, travel, training, supplies, and transportation; and (5) did not borrow to pay the $160 million to the program in 1988. GAO could not determine the actual amounts USPS saved from initiatives, since the savings depended on reductions in operational work hours, and USPS shifted an unknown number of hours to other duties and functions.

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