QUESTIONS have been raised concerning the payment of $97,793 in legal fees by the board of governors of the Postal Service to Joseph Califano, a private attorney who represents the board on a broad range of matters. During the controversy surrounding the Meese nomination, Mr. Califano represented board chairman John McKean, who had made loans to Mr. Meese prior to his appointment. Mr. McKean was not himself a subject of an independent counsel's investigation, and he was not entitled by statute to reimbursement of attorney's fees, as was Mr. Meese. Nevertheless, the board decided that at least a part of the bills he incurred were attributable to matters involving his government appointment and that the board should pay them.

The immediate question to be considered by a congressional oversight committee is whether the board should have been billed for these expenses or whether Mr. McKean should have paid them out of his own pocket. But there is a broader question here, and it applies to all government agencies: under what circumstances, terms and conditions should public agencies, or even such quasi-public ones as the Postal Service, retain private lawyers?

You might have assumed that the 17,000 attorneys employed by the government are capable of handling all its legal affairs. This is not the case. In the past two years, federal agencies have paid more than $50 million to private attorneys at rates up to $285 an hour. Outside lawyers have been retained to do everything from fighting a landlord over an agency's rent to advising on complicated financial transactions. Dozens of agencies, including those with complicated litigation responsibilities -- the SEC, FTC and EEOC -- use no outside lawyers at all, but some -- the banking regulatory agencies, for example -- use them extensively.

Because there is no coherent, government-wide policy on the use of private attorneys, individual agencies can make expensive arrangements with little oversight. A uniform policy and centralized supervision are needed. There should be rules on the hiring of former government employees to serve their old agencies. Hourly fee caps should be considered, as should flat yearly retainers for firms that have long-term arrangements. An independent review board should approve all contracts with private attorneys before they are signed. These safeguards would prevent after-the-fact controversies, such as Mr. McKean's, and would provide an incentive to keep these expenditures at a minimum.