Report Summary
In the past, government agencies could expect a virtually automatic increase in their annual budgets, to at least keep pace with infl ation. Today, the mantra for government agencies is “fl at is the new up”. In other words, agencies must plan for fl at year-on-year budgets at best and should have contingencies in place to accommodate spending reductions. The goal is to ensure that agency programmes provide a solid return on investment (ROI). Internally, that means that agencies will have to show regular, measurable progress towards meeting the goals that have been set for them and that they have set for themselves.
Externally, particularly in reporting to Congress, agencies will have to illustrate precisely that progress and how it is being achieved at the lowest cost possible. The cost overruns that were once a frequent feature of government programmes are a thing of the past. As the US federal government settles in for an extended period of fi scal uncertainty, government agencies will need to change the way in which they plan programme budgets. For most of the past decade, Congress’s inability to deliver timely appropriations bills has forced agencies to operate under continuing resolutions, in which funding is held to current or reduced levels.
Political rhetoric points to constrained budgets for the foreseeable future. And the ongoing threat of even more drastic measures, such as across-the-board sequestration funding cuts in which Congress mandates specifi c and non-negotiable reductions in all agency budgets, only adds to the uncertainty. Internally, agencies will have to adjust by limiting comprehensive planning even for multiyear programmes. They will have to step up programme monitoring and evaluation, with monthly— sometimes even weekly—appraisals of projects, as cost overruns will not be covered by future budgets. Likewise, in Congress they will need to meet more exacting expectations as committees tighten up their oversight of agency spending