Friday, August 19, 2011

OMB on Fiscal Challenge: Strategic Analysis A Must

Don't use one of these to cut the budget.
If there is some good news out of the Office of Management and Budget fiscal 2013 budget guidance asking agencies to propose cuts, it’s this:

These 5 and 10 percent reductions from the 2011 enacted level should not be achieved by proposing across-the-board reductions.
It’s a point OMB Director Jack Lew reiterated in his blog post commenting on that guidance:

We do not believe in making across-the-board cuts; rather, we believe that we should cut what is wasteful or not essential and invest in what is critical to long-term growth and other priorities
Hopefully agencies will take a “don’t have to tell me twice” mentality toward these cuts and look strategically at where they can cut ineffective or low priority programs so they can “double down” on the programs brining the most value to their missions.

PSC has long said that we recognize that austerity is here and we’ll all feel some pain, but that doesn’t mean arbitrary cuts should take place. While cutting across the board is the easy path, such practice ultimately is an abdication of rigorous analysis that often leaves mission-essential programs underfunded while keeping ineffective programs intact. Strategic analysis is a must and is smart budgeting. It’s great to see that OMB agrees.