Would a more competitive congressional budgeting environment improve program performance?
By Stuart Kasdin
Many observers have suggested that the key to making government efficient and effective, operating more like a business, is competition. In our paper, “The Relative Influence of Appropriation Subcommittees: Institutional Structure and Program Performance,” we ask whether this assumption might also apply to congressional operations — what are the consequences of a more competitive congressional budgeting environment?
The House and Senate appropriations committees each have 12 subcommittees that are responsible for setting the budgets for specific agencies and programs. The appropriations committee chairs divide the overall annual funding level (known as the 302a allocation) into 12 parts (known as the 302b allocations); these allocations set the annual budget totals for each subcommittee to use in funding the different agencies and programs under their jurisdiction. In a sense, appropriations subcommittee members operate much like a consumer in a market, choosing among different agencies, each of which is seeking resources for their programs.
A more competitive subcommittee environment might directly encourage better program quality by weeding out bad programs. Subcommittees can maintain or even increase spending on effective programs, while reducing spending for or eliminating ineffective programs. A competitive subcommittee environment could also indirectly affect program quality: Because agency program managers anticipate that the appropriations subcommittees care about program performance, they are motivated to deliver effective and efficient programs.
Our analysis focuses on the appropriations subcommittees during a period in the George W. Bush administration, when Congress and the White House were both under Republican control. We use scores from the Program Assessment Rating Tool (PART), a metric designed by the Bush administration to formally evaluate the effectiveness of federal programs, to determine whether some appropriations subcommittees are better able to generate improved performance from the agencies under their jurisdiction.
We consider two characteristics of the subcommittees as influential in affecting program efficiency and effectiveness: The subcommittees’ competitive market environment and their members’ workload.
Our first hypothesis is that when subcommittee financial resources – the 302b allocations – are lower, the competition for resources is increased and through direct and indirect means, program performance is enhanced.
Our second hypothesis is that member workloads matter. A lower workload allows subcommittee members to provide more oversight and develop greater expertise over the programs in their subcommittees’ jurisdiction.
We first evaluate our hypotheses in case study form, comparing two sets of program areas identified by OMB and GAO as having similar goals and potentially common performance measures. Because these programs are also spread across different appropriations subcommittees, we can measure the influence of the appropriations subcommittees on program performance.
The first group of programs, focused on low-income housing assistance, mostly fall within the jurisdiction of the Agriculture, VA-HUD, and Interior appropriations subcommittees. The Agriculture subcommittee had a relatively low workload and low funding levels, and the programs’ performance, as measured by PART, were mostly estimated as ‘moderately effective.’ In contrast, the VA-HUD subcommittee had both high workload and high funding levels; the PART evaluations for programs in this subcommittee were lower, with one program assessed as moderately effective, while four programs were assessed as ‘not performing.’ (Two programs were assessed as having ‘results not demonstrated’ and two were measured as ‘ineffective.’)
Another set of programs identified by OMB as having common goals are the rural water infrastructure programs, which help rural communities locate and improve their water availability. In general, programs in subcommittees with lower workloads and smaller budgets are associated with higher PART scores, while those in subcommittees with higher workloads and higher funding tended to receive lower PART scores.
Our regression analysis confirmed the case study results which showed that subcommittees with smaller budgets and fewer programs to oversee get better program performance results. For the first hypothesis, we found that greater resource availability in a subcommittee was negatively correlated with program effectiveness and efficiency as measured by the PART. However, greater program concentration – the equivalent of a market environment dominated by fewer firms – is not tied to lower program performance. There is no evidence that the distribution of larger programs within a subcommittee affects how appropriators treat the programs under their purview.
We examine the second hypothesis focused on member workload, both in terms of the range of issues in a subcommittee’s jurisdiction, and in the number of programs subcommittee members are responsible for funding. These variables reflect the subcommittee’s information needs and influence the potential for appropriations subcommittee members to control agencies by monitoring and metering program performance. We find that subcommittees with fewer budgetary decisions to make and fewer programs for which subcommittee members are responsible demonstrated greater performance for the programs under its jurisdiction. Lower subcommittee workload is correlated with better performance by the government agencies the subcommittees oversee.
To improve program performance, Congress could break up the largest appropriations subcommittees. For example, the Education-Labor subcommittee, which includes discretionary spending for the Departments of Education, Labor, and most of the Health and Human Services, as well as some smaller independent agencies, has a mean PART score of 33, the lowest of any subcommittee. It also has the most programs (114), is among the subcommittees with the highest budget functions (8), and has a logged value of spending at 18.76, smaller only than that of the Defense subcommittee. Adding a new appropriations subcommittee (or subcommittees) should increase the capacity for oversight and understanding program operations, leading to more effective agency program design and delivery, as well as the potential for more timely appropriations.
Stuart Kasdin was a professor of public management at George Washington University, served at OMB for over 11 years, and currently serves on the Goleta City Council in California.