Report Offers Ways to Improve Federal Budget Process
It is no secret that creating the federal budget each fiscal year is a cumbersome and challenging process. Just look at the ongoing situation, where Congress has yet to agree on funding for FY 2024 and government shutdown deadlines loom on March 1 and March 8.
A new report, Opportunities for Management When Budgeting, has suggestions on how to improve the federal budget process at three levels: the President’s recommendations, congressional consideration and appropriations, and budget execution.
The report is from the IBM Center for the Business of Government in collaboration with the Shared Services Leadership Coalition (SSLC). It was compiled using insights from experts and stakeholders in government budgeting, technology, and management.
“Partly because of weaknesses in how budgets are developed first in the executive and then in the congressional stage of the process, critical gaps have developed in the deployment of technology, and the government has responded sluggishly to opportunities offered by commercial innovation,” stated the report.
It looked at challenges in each area and then offered solutions in three phases: “modest first steps,” “bolder moves,” and “transformative actions.”
The goal was to explore ways of increasing the impact of government management initiatives and gain traction for management initiatives in the budget process.
“The budget process offers many levers to support innovation and change and promote greater government capacity and agility,” stated the report.
When Developing the President’s Budget
When it comes to developing the President’s budget, the report singled out various problems including lack of investments to modernize technology and the workforce, lack of a central plan from the Office of Management and Budget (OMB) to address tech issues, and agencies not using the budget process to improve management.
For “first steps” to improvement, the report recommended strengthening the linkage between agency management routines and agency budget development, conducting management reviews of select cross-agency and government initiatives for inclusion in the President’s budget, and using the IT budget review process to prioritize IT investments.
“Bolder moves” include developing and presenting in the budget a prioritized and fully priced multiyear plan to address the government’s capital needs and including estimates of administrative capacity improvements in requests to increase funding for established or new programs.
A “transformative action” is to conduct in-depth spending reviews for selected policy objectives to inform options for more productive resource use.
Congressional Improvements
For congressional consideration of the budget and appropriations, the report identified challenges such as the outsize influence congress has in considering appropriations, the detailed direction that agencies must follow on spending money, and appropriators living in a “one-time world” without thinking longer-term.
As for solutions, “first steps” include extending the planning horizon for appropriations to two years or longer.
“Bolder moves” include adopting funding mechanisms that permit agencies to retain and reinvest administrative savings and use these savings to accelerate government modernization and create a scorecard for management improvements in budget-related legislation.
A “transformative action” is to reorganize the appropriations process around major policy objectives and reduce restrictions on executive flexibility in appropriations.
Budget Execution
The report blamed a “culture of compliance in the federal bureaucracy” for hampering the efficient execution of federal budgets. Instead, the report argues that an environment where staff members are empowered, the top priority is end-use customer satisfaction, and risk is identified and addressed early, would go a long way in more effectively implementing budgets.
“First steps” include expanding staffing and resources for shared services coordinating offices, developing governmentwide standards and best practices for successful use of shared services centers and franchise funds, and finding new ways to engage employees at operating levels.
“Bolder steps” include using a centralized capital planning process and central revolving capital fund to plan and execute large, cross-agency investments in improved management capacity.
A “transformative step” would centralize responsibility for leading transformative changes across the government in how programs are supported, including through shared services, to address enterprise-wide management challenges.
