Office of Management and Budget Director Richard G. Darman paused for a few hours yesterday in the midst of the budget crisis to talk about the government's management problems, which he said "remain enormous."
Speaking as the only witness before the Senate Governmental Affairs Committee, Darman gave an update of OMB efforts to improve the "high risk areas" he outlined last year and to establish accounting standards to be used by individual departments in assessing the decentralized bureaucracy's financial affairs.
In July 1989, Darman asked officials at the 14 Cabinet departments, the Environmental Protection Agency and the National Aeronautics and Space Administration for a "fresh assessment" of internal financial controls.
The request was an effort to avoid the surprises of the scandals that rocked the Department of Housing and Urban Development and an attempt by the Bush administration to distance itself from problems inherited from the Reagan era.
In response to the findings, Darman developed a list of 112 "high risk areas," programs to be monitored to avoid HUD-esque problems.
Yesterday, Darman told the four committee members present that there had been "significant progress" in 44 areas; "active efforts underway to improve progress" in 23 areas; and in 28 areas, "OMB has reservations about the adequacy of agency progress and/or plans."
"It is at least noteworthy that, while public attention and media hoopla center on the budget," Darman said, "there is still quiet, steady work going on to try to straighten out the government's underlying management problems."
He also said OMB had proposed an increase of $70 million in the 1991 budget for inspectors general, who are the internal investigative arm of each agency.
In addition, OMB, the General Accounting Office and the Treasury Department have established "an accounting standards mechanism" to be used by individual agencies.
Late yesterday, sources at OMB said six additional "high risk" areas have been identified. They are: the Commerce Department's Minority Business Development Administration; the Department of Health and Human Services's monitoring of Medicare payments; the Justice Department's oversight of private bankruptcy trustees; the Labor Department's control of federally funded property; the State Department's inadequate controls over visa processing; and problems at the National Labor Relations Board over employer funds for payment of backpay.
At the hearing, Darman also briefed committee members on improvements in some of the risk areas, among them:
Internal Revenue Service: An OMB task force is working with the Treasury Department on a program to improve taxpayer services and collection of back taxes.
Food stamp program: The Agriculture Department has developed new redemption certificates and revised deposit requirements that should make it possible to reconcile food stamp coupon payment data with bank and retailer records.
Medicare secondary payer program: The Department of Health and Human Services is sharing data with the IRS and the Social Security Administration as one short-term way of trying to prevent Medicare from paying for benefits that actually should be paid by other insurance companies.
Computer security: OMB has issued guidelines to assist federal agencies in planning for the security of their computer system. Last month, OMB began meetings with each agency to discuss the issue.