You have discussed at some considerable length what is wrong with S. 3419, but I was hoping we could have some positive suggestions for dealing with the problem of actually organizing to achieve an effective. consumer product safety program.

COMMERCE COMMITTEE ACTION

The Commerce Committee has been very clear in its 17-to-1 vote turning down the administration's proposal. They considered simply a shuffling of boxes not actually solving the problem of realigning the forces of government to take into account the really new demand of the American people that we accord this function a higher priority level inside government than we have heretofore.

Has the administration given any sort of consideration to a means of organizing within HEW to provide the Consumer Safety Agency with the visibility, independence and direct access to the Secretary that the function seems to demand?

ORGANIZATIONAL CHANGES

Mr. CARLUCCI. We have discussed, Mr. Chairman, with Secretary Richardson some organizational changes that he might make.

I feel, quite frankly, it would be more appropriate for Secretary Richardson to speak to the committee rather than to have it come from the Office of Management and Budget at this point.

Senator PERCY. You were present yesterday in the room, and I think that is quite good. I recognize there are certain prerogatives of the Secretary-and I participated in the reorganization of the Office of Management and Budget. We were looking to OMB also, independently, just as you quite independently arrived at decisions on appropriate budget levels and balancing of priorities, to give your expertise to this activity. We are now soliciting and seeking counsel and advice. I think I made it very clear in my opening statements, my bias. I am trying to keep my mind open, but I just do not think this committee is going to sit here and do nothing about this problem when faced on one side with an overwhelming mandate of the Commerce Committee that it just be taken out lock, stock, and barrel and independently set up.

I can simply say that I could not countenance just box shuffling and then presume we are going to pretend to the American people that we have really changed something by doing that. There has got to be substance, there has to be power put in, and we have to decentralize certain of the functions and specifically say who is responsible and not have the kind of problems we have been facing now.

We had a decision made by the Secretary yesterday which I think is very important, but still I would like to get the benefit of the judgment of yourself and Mr. Shultz who carry a tremendous responsibility, for how the executive branch of our Government is actually organized to better its affairs.

ORGANIZATIONAL STRUCTURE

Mr. CARLUCCI. Let me say this, Mr. Chairman, with regards to the organizational structure.

We think that there are ways that can be found to upgrade the Consumer Safety Agency within HEW. We do think, at the same time, however, that it is important that these functions continue to be alined with HSMHA and with the National Institutes of Health functions under some kind of common leadership.

Within that kind of framework, we do think some organizational improvements can be achieved, and we certainly would be willing to make some specific proposals to the committee in writing if the committee would like, but I would like to be able to consult with Secretary Richardson at greater length before I do that.

If I may comment on something you said, which we think is very important, and that is: We do not want to simply move boxes around and pretend by moving boxes we have increased effectiveness, if indeed, we have not.

I would like, if I may, the indulgence of the committee for just 1 more minute to point out some of the things that the administration has done by way of increasing the authority and resources of FDA within HEW.

In the first instance, we did help create semiindependent status for FDA by breaking up the old Consumer Protection and Environmental Health Service to create an organizational entity which reported directly to an Assistant Secretary. We have, as you know, changed the top management of the organization, and we have pushed for a more vigorous program and given assurances of continuing support.

FUNDING

As I indicated in my testimony, we have also approved a breakthrough in the budget from $72.3 million in fiscal year 1970 to $192 million in fiscal year 1973.

MANPOWER

In addition, we have dramatically increased the manpower of the FDA in the two most recent fiscal years. We have increased it by 600 in fiscal year 1972, and we have proposed an increase of 1,100 in fiscal year 1973. That increase could be substantially larger if some of the legislation which is presently pending before the Congress in the area of consumer safety is passed.

IMPROVED CAPABILITY OF FDA

So, we think we have greatly improved the capability of the FDA to deal with the problems of consumer safety, but we are willing to consider other organizational changes, and we would be glad to consult with the committee.

Senator PERCY. I do not, in any way, discount what has been done. I tried to make it prefectly clear yesterday that I think there has been no question about the administration's dedication to this, its efforts to back it up and support it, and the eminently qualified, tough

minded people who have been put in charge. The question is: Is it enough, or can we now, through organizational procedure, strengthen it sufficiently for the next 20 years so that we will not just be trying to catch up with what we should have been doing 5 or 6 years ago?

In principle, does it make good sense to you to separate out the regulatory functions from health research and services?

Regulation itself is such a full-time job and deserving of high priority. The possibility of giving equal status to health care and needs through one Assistant Secretary and the regulation of all foods, drugs, and consumer products to another one would not seem to be overloading our hierarchy but rather giving it division of responsibility which would be thoroughly clearcut from the standpoint of good organi

zation.

Mr. CARLUCCI. I think this depends very much, Mr. Chairman, on the nature of the program. You used the analogy of EPA, and I tend to think that that analogy is not appropriate for a function such as Consumer Safety.

CONFLICT OF INTEREST

EPA in the area that it regulates would have certain conflicts of interest, so to speak, within a department such as the Department of the Interior, which is charged with responsibility for energy and water developments. However, in the case of Consumer Safety, it seems to us that the regulatory functions have a common purpose and are very much in harmony with the overall goal of improving the physical and mental well-being of our country's citizens.

So, we think the regulatory functions reinforce the other functions, the other health functions that are within HEW, and, accordingly, we see no compelling need to separate the regulatory aspect from the R. & D. aspects and from the service delivery aspects.

Senator PERCY. What worried me yesterday, as you could see, was the problem of having someone in charge of the Bureau of Product Safety so submerged that he was not even here among the eight witnesses or so that were present from HEW. He is five echelons down in the organization chart. He has got to go through FDA; he has got to go through an Assistant Secretary; he has got to go through an Under Secretary to the Secretary. It just seemed to me that a person with that kind of responsibility should not be so limited in the amount of time he is able to spend with the Secretary.

Just to specifically put the question to you: Would you be able to support having an assistant secretary report directly to the Secretary with as much direct access to the Secretary as the Under Secretary has now?

I realize that creates one additional secretaryship.

ASSISTANT SECRETARY FOR HEALTH

Mr. CARLUCCI. I am not so much concerned about the creation of an additional assistant secretaryship, although, heaven knows, we have enough assistant secretaries in the Federal Government already. But I am more concerned about the interrelationship between the Consumer Safety Administration and the Health Services and the Mental Health Administration and the National Institutes of Health. We think that this interrelationship is very important, that there has to

be cross-fertilization and there has to be adequate communication, and that the Assistant Secretary with overall responsibility for health is the one charged with doing the policy formulation and long-range planning, and seeing that this cross-fertilization occurs.

Senator PERCY. I think this administration has done a great job in correlating things and coordinating them with the concept of policy councils. This is an approach really starting with the National Security Council, but only in that one area have we for years pulled together Intelligence: the Defense Department, State, and so forth, dealing with our national security. This administration then created and implemented a Domestic Council to coordinate everyone in that field. And, more recently, in an area that previously was going helterskelter, the Council on International Economic Policy has been pulled together.

I think this concept has worked and proven its worth.

Would you consider in the area we are discussing, the creation of a Health and Safety Council which could consist of the Secretary, Assistant Secretary for Consumer Safety, Assistant Secretary for Health, directors of HSMHA and NIH, and commissioners of Food, Drug, and Product Safety. That would bring together in one council everyone involved with regulation, policy and implementation. There would then be no doubt but that these men could have access to the Secretary, and on a periodic and regular basis meet together, plan and coordinate things together, and assure coordination and direction.

I am simply taking a page out of your own book, which I think has been a brilliant contribution to pulling together the multivarious activities of government by forming and creating them into one functional unit with responsibility.

Mr. CARLUCCI. Mr. Chairman, I would like not to take a position on the particular titles that you read in the creation of the council; however, I would endorse the concept of a council to pull together the various policymakers.

As you point out, we have been successful in a number of areas with this kind of council, and I think the concept is a good idea.

On the other hand, I would like to reserve our position with regards to the titles that you mentioned.

INTERRELATIONSHIP

Senator PERCY. Specifically, from your own experience with the way the Government actually operates today, isn't there really a greater interrelationship as to EPA and FTC, outside of HEW, than to HSMHA and NIH within HEW?

Mr. CARLUCCI. We do not think so. We think that a common strategy for health in a broader sense, a common strategy promoting the wellbeing of our people as individuals and as members of families, is a basic purpose that we ought to be striving for. And, as you are aware, Mr. Chairman, this is one of the goals of the Department of Human Resources which would have the Administration for Health, the Administration for Income Security, and an Administration for Human Development. We see them as common purposes.

With regard to relationships with EPA, let me point out, following your discussion of councils, that we also had a regional council set up with the domestic agencies Under Secretary Group which I chair on which both HEW and EPA sit.

The original council mechanism, as you know, extends to the regional level, and we have regular, periodic meetings to discuss common strategies and resolve interagency problems.

Both EPA and HEW do sit on this regional council.

So, we think there is a coordinating mechanism in being between EPA and HEW and, indeed, to remove FDA and HEW would deprive FDA of the benefits of this particular regional coordinating mechanism.

Senator PERCY. Who represents HEW on the council?

Mr. CARLUCCI. The Under Secretary, Mr. Veneman, represents HEW on the under secretary group, and at the regional level, the regional director represents Mr. Veneman.

I might point out that Secretary Richardson has underway a very active program for decentralizing decisionmaking authority to the region so that the HEW regional directors can, in effect, make the same kind of decisions they contemplate making.

Senator PERCY. But still, Mr. Veneman, able as he is, is too removed structurally and organizationally from Commissioner Edwards in this particular case.

Mr. CARLUCCI. He is too removed in this particular case, but in the regions-I would have to check on what the regional structure is. I think they are probably less removed from the regional director than they are in the Washington structure.

INDEPENDENCE

Senator PERCY. On page 3 of your statement you say that "independence has not produced greater visibility, public interest, or freedom from pressure."

Could you give us some specific examples of the failure in independence and explain to us why this approach did not work?

Mr. CARLUCCI. Well, I would not like to be in a position of criticizing any of the independent regulatory agencies, but, if I might, Mr. Chairman, I think I could draw on my own personal experience to indicate where I think a closer tie with existing institutions would have made programs more effective.

As you are aware, I am a former Director of the Office of Economic Opportunity. One of the things that we would like to do with our reorganization program is to put the Community Action program in the Department of Community Development.

Community Action, as you are aware, was formed as a catalytic. agency, an agency which was supposed to tie together other programs so that they could better respond to the needs of the poor. At the same time, the Community Action agencies and OEO have found themselves frustrated in trying to get a handle on such programs as highways, Model Cities, HEW health programs, simply because they have been outside the organizational structure and the independent agency-the head of OEO has not had the clout necessary to deal with Cabinet Secretaries. Hence, many Community Action agencies have slipped