A presidential panel studying ways to streamline the federal government said yesterday that it will not ask President Reagan to dismantle the Veterans Administration despite a preliminary study that recommended "serious consideration" be given to eliminating the agency.
Felix E. Larkin, a member of the President's Private Sector Survey on Cost Control, said one of the panel's 36 task forces recommended "several months ago" that the VA be disbanded and its functions transferred to other agencies. Larkin said yesterday that suggestion was rejected after the panel decided it was "beyond the scope" of its mandate.
Larkin's comments did not satisfy Democratic National Chairman Charles T. Manatt, who called on Reagan to repudiate the presidential panel. "The pattern is all too familiar," said Manatt. "A task force comes up with some zany idea and at first the Reagan administration falls all over itself denying paternity. Unhappily, however, the idea usually blossoms into a full-blown disaster . . . . "
A copy of the task force report was released this week by Rep. Douglas Applegate (D-Ohio), chairman of a House Veterans' Affairs subcommittee. Several Democrats immediately criticized the panel, and the nation's two largest veterans' groups said they were outraged by its suggestion.
"This entire misunderstanding is another example of the unfortunate consequences of leaking preliminary staff studies," said Larkin, who criticized Applegate for releasing the report.