Mr. TAYLOR. We commend you for your award and the efforts you have made, and we certainly appreciate the work that you are doing.

Thank you gentlemen, we will now proceed with the General Accounting Office.

Mr. DIMARIO. Thank you, Mr. Chairman.

TUESDAY, JUNE 26, 2001.

GENERAL ACCOUNTING OFFICE

WITNESSES

DAVID M. WALKER, COMPTROLLER GENERAL

GENE L. DODARO, CHIEF OPERATING OFFICER

SALLYANNE HARPER, CHIEF MISSION SUPPORT AND CHIEF FINANCIAL OFFICER

RICHARD L. BROWN, CONTROLLER

OPENING REMARKS

Mr. TAYLOR. We will now take up the budget of the General Accounting Office. The budget request is $430.3 million and 3,275 FTES. The funding includes $2.5 million that will be derived from reimbursable programs. We have the Comptroller General, David M. Walker. Mr. Walker, good to see you, sir.

Mr. WALKER. Good morning, Mr. Chairman.

Mr. TAYLOR. Accompanying Mr. Walker are several members of his staff. We are pleased to have all of you here. I would like to begin by thanking Comptroller General Walker for his traveling into my district a few weeks ago and presenting a very important report, which is what the GAO always does, on the quality of the air in the Great Smokey Mountains. That report has cleared the air, so to speak. In the up coming debate, it will provide the Congress and agencies invaluable service and information in addressing that important issue.

Mr. Walker, would you take the time now to introduce your staff? Mr. WALKER. Thank you, Mr. Chairman. To my left is Gene Dodaro, who is the Chief Operating Officer of the GAO. To my immediate right, Sallyanne Harper, Chief Mission Support Officer, and to her right, Dick Brown who is our Controller.

PREPARED STATEMENT

Mr. TAYLOR. I know you have a prepared statement which has been circulated to members of the committee and will be inserted in the record at this time.

[The prepared statement of the Comptroller General follows:]

Mr. Chairman and Members of the Subcommittee:

As the Comptroller General of the United States, it is a pleasure to appear before you today to present the General Accounting Office's (GAO's) budget request for fiscal year 2002. I am proud to say that we served the Congress and the American people well in fiscal year 2000. Our work resulted in substantial financial savings and significant improvements to government that will benefit all Americans. I am confident that fiscal year 2001 will be just as productive.

At the outset, I want to thank the Committee for its support in helping enact GAO's human capital legislation. This legislation will go a long way toward helping us address many of our human capital requirements and ensuring that GAO remains prepared to meet the Congress' needs in the future. We have issued implementing regulations for the early retirement and scientific and technical staff provisions and plan to issue authorizing regulations later this year to guide any potential future buy-outs and reductions-in-force.

GAO's fiscal year 2002 budget request is critical to our continuing efforts to reorganize and reshape the agency, reengineer our business processes, and train and equip our staff with up-todate technology to help meet Congress' current and future needs. Congressional mandates and requests continue to represent over 90 percent of our work, and our workload and productivity remain at near-record levels. Our budget request represents our needs--not wants--to sustain this level of effort and support to the Congress.

Since becoming the Comptroller General at the beginning of fiscal year 1999, GAO's appropriations have been insufficient to fund mandatory and inflation expenses associated with employee compensation and benefits, and make needed investments in critical areas, such as technology, training, and performance recognition. We have managed our resource shortages by reducing our staffing levels and underfunding critical investments. We cannot, and should not, continue this trend.

The funds we are requesting are essential to helping us remain prepared to meet the complex, controversial, and multidimensional issues and challenges confronting the Congress now and in the future. Our request includes only those funds we need to stabilize at our targeted 3,275 fulltime equivalent staffing level and to incrementally increase investments needed in training, technology, performance recognition, and other key support items to a level consistent with best practices of other comparable government and private sector entities.

Before I begin detailing our fiscal year 2002 budget needs, I would like to highlight some of GAO's accomplishments and achievements in fiscal year 2000 and the major challenges confronting us.

A REVIEW OF GAO'S FISCAL YEAR 2000 ACCOMPLISHMENTS

GAO had a tremendous year in fiscal year 2000. As a result of actions taken on our work by the Congress and federal departments and agencies, taxpayers benefited from over $23 billion in financial savings-a $61 return on every $1 invested in GAO. Our work also resulted in

Among other things, by acting on our recommendations, the government improved public health and safety, strengthened national security, better protected consumers, and improved its financial management and information systems. We also contributed critical information to public debates on Social Security and Medicare reform and called attention to looming problems, such as the security of government computer systems and the knowledge and skills needed in the federal workforce in coming years. Other indicators of our performance, such as the number of testimonies our senior executives provided and recommendations implemented, exceeded that of most recent years. I also am pleased to report that we made significant progress toward addressing many of the organizational, human capital, and information technology challenges that I outlined for you at last year's hearing. We had a very busy and productive year.

Taxpayers Benefit from $23 Billion in Financial Savings

In fiscal year 2000, GAO helped achieve about $23.2 billion in direct financial benefits for the American taxpayer. These benefits are a result of the Congress or federal departments and agencies implementing our recommendations to make government services more efficient, improve the budgeting and spending of tax dollars, and strengthen the management of federal resources. The estimated financial benefits include budget reductions, costs avoided, resources reallocated, and revenue enhancements. These results exceeded our target of $22 billion and were greater than that of the previous three fiscal years, as illustrated in the following graphic.

Some examples of GAO's work that contributed to these financial savings include the following.

Helping to Prevent Fraud and Abuse in Medicare: GAO had long advocated increased funding specifically for activities to prevent fraud and abuse in the Medicare program. In 1996, the Congress passed the Health Insurance Portability and Accountability Act,