FEDERAL UNEMPLOYMENT BENEFITS AND ALLOWANCES For the next area, Federal unemployment benefits and allowances, a total of $2,730.5 million is being requested. Of this amount $410 million is requested as a direct appropriation to the Federal unemployment benefits and allowances account, $20.5 million will come from reimbursements from the U.S. Postal Service, $200 million will be carried over into fiscal year 1976 from fiscal year 1975, and $2.1 billion will be derived from a nonrepayable advance made from funds appropriated in 1975 to the advances to the unemployment trust fund and other funds account. It is estimated that these funds will provide more than 5 million weeks of benefits to former Federal and Postal Service employees, 0.3 million weeks of allowances under trade adjustment assistance and 34.4 million weeks of compensation for individuals covered under special unemployment assistance. ADVANCES TO THE UNEMPLOYMENT TRUST FUNDS AND OTHER FUNDS The next topic is advances to the unemployment trust fund and other funds. No funds are being requested for this account as those from fiscal year 1975 will, in our judgment, be sufficient to last through 1976. In 1975, $750 million has been appropriated, and approximately $347 million transferred from other accounts. In addition, a $5 billion request is now awaiting congressional action. Of this total availability of $6.1 billion, it is estimated the $1.9 billion will be used in 1975, to provide loans to States for the payment of extended and regular State unemployment insurance benefits. This will have a balance of $4.2 billion available for use in 1976 for similar purposes including payments under the Federal unemployment benefits appropriation. GRANTS TO STATES FOR UNEMPLOYMENT INSURANCE AND EMPLOYMENT SERVICES For the grants to States for unemployment insurance and employment services appropriation in 1976 our request is $1,069 million. An anticipated carryover from the 1975 urgent supplemental will make the total availability $1,149.6 million. During 1976 the State employment security agencies are expected to pay $17.4 billion in unemployment benefits to over 14 million beneficiaries under Federal and State lar and extended benefit programs. These unemployment programs include individuals covered by State unemployment insurance laws, former Federal personnel workers adversely affected by foreign trade agreements, and qualified workers not otherwise eligible under any Federal or State unemployment compensation program. MANPOWER ADMINISTRATION, PROGRAM ADMINISTRATION regu For the Manpower Administration, Program Administration account our fiscal year 1976 request is $96.3 million and 3,162 positions. This represents a net increase of $600,000 but a decrease of 270 positions. This appropriation handles the administration, as you know, of all manpower programs, 88 percent of the Department's 1976 funding. In fiscal year 1976, this appropriation will no longer reimburse the Department of Health, Education, and Welfare for performing CETA related functions. This transfer of responsibility reduces the program administration appropriation by 100 positions and $1.4 million. Another major program change in this appropriation is the reduction of an additional 100 positions and $1.3 million commensurate with the decentralization of responsibility for administering CETA programs to State and local governments (prime sponsors). The remaining decrease of 70 positions is due to the phase-out of emergency manpower programs set up on a temporary basis in fiscal year 1975. We now turn to other programs in the Department. SPECIAL BENEFITS The special benefits appropriation request is $201 million, plus $214.9 million in reimbursements from other agencies, making a total availability of $415.9 million. This request of $201 million is an increase of $36 million over 1975 due to an increase in the total number of claimants receiving disability benefits, rises in the cost of medical care for eligible beneficiaries, and raises in the level of Federal salaries upon which the amount of disability compensation received is based. OCCUPATIONAL SAFETY AND HEALTH ADMINISTRATION The Occupational Safety and Health Administration request of $116 million, an increase of $13.7 million, reflects our continued concern for the occupational safety and health of the Nation's workers. This increase is primarily related to additional funds for grant programs administered by the States and for providing full-year funding for additional Federal inspectors provided on a part year basis in 1975. The mission of the Occupational Safety and Health Administration is to reduce the number and severity of job-related injuries, illnesses, and fatalities-not merely to issue more standards or make more inspections. Our goal is a comprehensive program which combines the enforcement of standards with training, consultation, research, and the resources and technology of the private sector for maximum effectiveness in reducing injury and illness rates. I would like to quote a statement by a former Secretary of Labor regarding occupational safety and health: Modern industry has done much to improve working conditions, but much still remains to be done to provide for greater protection of the men and women who toil in the factories, mines, and stores * * *. Increased safety efforts are not only right from the humane viewpoint, but they are sound from a business standpoint. These words were written by the first woman cabinet officer, Labor Secretary Frances Perkins, whom I knew, for the annual report of the Secretary of Labor for the fiscal year ended June 30, 1933. Clearly, much does still remain to be done. We must show that occupational safety and health does make good economic sense. LABOR-MANAGEMENT SERVICES ADMINISTRATION The next agency is Labor-Management Services Administration. The Labor-Management Services Administration request for $42 mil lion is an increase of $4.9 million over the 1975 estimate. Most of this is attributable to full-year funding of the employee benefit security activity for which only part-year resources were available in 1975. This activity was created by passage of the Employee Retirement Income Security Act and portions of the administrative responsibilities for this legislation were placed in Labor-Management Services Administration. This act also set up the Pension Benefit Guaranty Corporation, which is not included in the Department's budget, although I serve as Chairman of the Corporation. Separate testimony on the Corporation will be given at a later date. BUREAU OF LABOR STATISTICS We turn next to Bureau of Labor Statistics. The request for the Bureau of Labor Statistics is $61.7 million, an increase of $7 million over 1975. The Bureau of Labor Statistics has always been the major source of data on key economic indicators such as employment, wages, prices, and productivity. The current economic situation underscores the need for even more detailed, reliable, and current information. Since the BLS statistical series are, and will continue to be, so important to planners and policymakers, we have initiated an intensive program to expand and to improve these primary indicators. The several new programs included acceleration of conversions of the BLS statistical series to the new Standard Industrial Classification; improvements in the Employment, Hours, and Earnings series and in the Quarterly Report on Employment and Wages; expansion of the Current Population Survey in order to collect data on job searching activities of the unemployed and on the hourly and weekly earnings of particular groups in the labor force; acceleration of the program to improve the Wholesale Price Index and related industrial price indexes; expansion of coverage of the international price competitiveness program. In line with the decision in fiscal year 1975 to produce two Consumer Price Indexes in 1977, an increase is requested to continue the financing of needed developmental work. The final two proposals are in the wage statistics area. The first would accelerate the development of a comprehensive wage index that will measure changes in employee compensation and compensation trends, and second is in response to requests by the Office of Management and Budget and the Civil Service Commission that BLS expand the coverage and scope of its survey of professional, administrative, technical, and clerical salaries, which is used to adjust the salaries of Federal civilian and military personnel. EMPLOYMENT STANDARDS ADMINISTRATION The budget request for the Employment Standards Administration totals $79.7 million, an increase of $3.6 million. The Department is requesting several changes in this budget for 1976. The 1975 Amendments to the Farm Labor Contractor Registration Act doubled the number of covered crewleaders, requiring an expanded enforcement effort. An increase is also being requested to meet the increased costs of conducting surveys under the Service Contract Act to establish prevailing wages for Federal service contracts. Additional funds are also requested to fully fund positions financed on only a part year basis in 1975 in our effort to strengthen on-going enforcement actions. In addition, the budget reflects a change in the financing mechanism for administrative costs associated with the Longshoremen's and Harbor Workers' Compensation Act. This change places the burden of financing the cost of administering the act on the industry and is consistent with the Federal policy of requiring the recipient of a Federal service to pay a reasonable charge. Carriers and self-insuring employers making benefit payments under the act will be assessed in proportion to the annual level (about 51/2 percent) of benefit payments made. This will result in a savings of $2.3 million in appropriated funds which are reflected in the budget request. It will also permit the Department to expand the service to both the claimants and the industry as envisioned by the 1972 Amendments to the Longshoremen's and Harbor Workers' Compensation Act. DEPARTMENTAL MANAGEMENT The request for departmental management, which includes the Office of the Secretary, the Office of the Solicitor, the Bureau of International Labor Affairs and the President's Committee on Employment of the Handicapped, is for $34.3 million, an increase of $2.5 million over the 1975 level including the pending supplemental related to the Trade Act of 1974. This increase is due almost entirely to mandatory costs principally associated with the Department's new responsibilities under the Trade Act. I would also not that this account supports more than just overhead activities. It also includes all the legal services efforts which aid in the administration of all the Department's programs, the administrative and legal review of decisions made in regard to claimants for benefits under various programs and participation in international activities that impact on the area of labor in this country. SPECIAL FOREIGN CURRENCY The special foreign currency appropriations requests remains constant from 1975 to 1976 with a total of $200,000 requested to hold labor attache conferences. Attached to this statement is a Summary table reflecting the 1975 and 1976 funding levels along with the appropriate percent changes from year to year. TRANSITIONAL BUDGET In closing, I'd like to say a few words about the transitional budget levels. A table showing these levels compared to the 1976 request is attached for your review. We have made an effort to fund just that portion that would be required during the 3-month period between fiscal years 1976 and 1977 so that all programs will begin with full year funding on the new fiscal year basis in 1977. That goal has been achieved in every case except special benefits which is 34.8 percent of the 1976 request. Compensation claims and reimbursements from other agencies make it almost impossible to stay within any type of quarterly proportional funding. In total, the departmental level for the transitional budget is 25.2 percent of the 1976 estimate. Thank you, Mr. Chairman. That is my statement, and my associates and I will be happpy to try to answer your questions. [Additional information follows:] |