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Pursuant to a congressional request, GAO reviewed the Department of Energy's (DOE) plans to cut costs by $4.4 billion, focusing on: (1) whether DOE cost savings efforts could impair its ability to clean up former nuclear weapons sites; and (2) DOE fiscal year (FY) 1995 cost-saving experiences. GAO noted that: (1) DOE has requested that program managers reduce budget outlays for fiscal years 1997 through 2000 by a total of $4.4 billion; (2) DOE has identified several initiatives to reduce cleanup costs, including privatizing activities and adding incentives to performance contracts; (3) DOE plans to continue using the budget process to set annual savings goals; (4) DOE FY 1995 savings estimates appear to be reliable; (5) DOE needs to define a consistent baseline for measuring savings and independently verify reported savings; and (6) weaknesses in the sites' reporting processes could affect the credibility of future savings reports.

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