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Were there to be further resource reductions, there would be a direct impact on program outputs.

The effect of the budget reductions is being felt primarily by the Federal Employees' Compensation (FEC) program and the Longshore and Harbor Workers' Compensation Program. The Black Lung program had only a small reduction in FY 82

The percent reduction in the budget did not result in an identical percentage reduction in staffing. By reducing funding for travel, training, ADP, and other support functions, we were able to maximize the staff-years available to process the workload, while minimizing short-term adverse effects. More specific information regarding each program follows:

Performance in FEC has been relatively stable the past several months, with little, if any, deterioration in performance noted. Processing timeframes have been fairly consistent over the past four or five quarters, and the pending case inventory has shown only a slight increase. Similar results have been noted in other output items. That is not to say, however, that the current situation has not created some strains. The reduction in trainingcan affect both staff expertise and morale, and the consequences are likely to show up in later months. Some offices are short of clerical support and claims processors.

One factor to consider in judging FEC's performance thus far is that the program currently has an approved, full-time permanent staffing level that represents a slight increase over FY 1981 Levels and is the highest FTP level ever for the program. Entering FY 1981, FECA had authorized 853 FTP positions plus ceiling for another 200 term appointments (through 9/30/81). This subsequently evolved into 903 FTP full-time equivalents for FY 1982, an increase of nearly six percent for FTP staffing. However, it represents a 14 percent reduction in overall approved staffing levels (853 FTP plus ceiling for 200 terms = 1,053 total). It has been our position that FTP staff are more stable and productive than temporary or term staffing. We believe that, at the very least, 1 FTP position is equivalent to 1.5 temporary/term position. Thus, the increase in FTP staffing does help, to some extent, offset the loss of the 200 term ceiling.

Another factor that has been beneficial in the program's ability to accommodate the reduction has been the moderating workload growth rates. No doubt if the program's workload were increasing at the rate it did in the mid-1970's, the program's situation would be more more adversely affected.

The situation in Longshore is somewhat different. There, deterioration in performance is evident. In the four quarters of FY 1981, Longshore processed 72%, 75%, 71% and 74% respectively of the controverted cases within 60 days. During the first quarter of FY 1981, only 58% of the controverted cases were processed within 60 days. Similarly, 57% of the informal conferences were completed within 45 days, compared to a range of 63 - 69% within 45 days in FY 1981. Other outputs show similar effects, and district office management has made it clear that the strain is becoming very great.

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We do not believe it is a constructive approach to permit FECA or Longshore to continue undergoing 16 percent reductions until they reach the point at which they can no longer handle the workload as a means to find the optimum staffing level for each program. We look at our workload and production experience to determine the level of needed staff. The relationship between incoming workload, production, timeliness, and staffing is analyzed to see what can be accomplished with varying staffing levels. Based on this experience, we conclude that Longshore has already reached and has more likely gone beyond the point at which it can adequately handle its workload with current staff. The situation with FEC is somewhat better. Any further reductions will have undesirable consequences in terms of production and timeliness and we will experience a return to the problems and conditions that characterized the program three or four years ago. These problems begin gradually but eventually grow progressively worse as minor problems create major problems resulting in a "snowballing effect" of deteriorating service. Once systemic problems develop, it takes months or years to resolve them, as FEC found out in the

mid-1970s. This would be a primary argument against reducing the programs' budget any further. Furthermore, because of the severity of the 16% budget cut, ESA has submitted two FY 1982 supplementalbudget requests that would result instead in an approximate 12% budget cut for FY 1982 .





SUBCOMMITTEE PROCEDURE Senator ABDNOR. We will just hesitate for a few minutes. I guess I am moving along too fast. We will wait for just a few seconds.

(A brief recess was taken.)

Senator ABDNOR. We will now hear from the Departmental Management Assistant Secretary for Administration and Management who will discuss departmental management requests.

Mr. Zuck, is that the way you pronounce your name, or Zuck?

Mr. ZUCK. Let me tell you, Mr. Chairman, it is pronounced Zuck in eastern Pennsylvania where I came from.

Senator ABDNOR. Fine. Thank you.

We welcome you to the committee, Mr. Zuck. And since you just got here, I will state, as I have to earlier witnesses, your entire statement will be made part of the record. And if you care just to summarize your statement, we will go from there.

Maybe you would like to introduce your colleagues who are with you.


On my left is Dr. Leonora Cole-Alexander who is the Director of the Women's Bureau of the Department, and on my right is Mr. Thomas McBride who is the Inspector General of the Department of Labor.

This account covers a wide variety of activities, and depending upon the nature of the questions, I have some other supporting witnesses should they need to be called upon.

SUMMARY OF BUDGET REQUEST I will submit the statement for the record and just make a short summary comment

The departmental management request for fiscal year 1983 is for $158.5 million. It represents an increase of $11.1 million over the 1982 comparable level. We are asking for program increases only in the Office of the Inspector General, where we are requesting an additional 52 positions and $2 million in additional program funds.

The remainder of the increase $6.4 million-is for mandatory increases.

I think, Mr. Chairman, with that general summary, I will proceed to answer your questions.


Senator ABDNOR. Very good, Mr. Zuck.

You led right into my first question. We often hear about more bodies being added. The obvious question is, “Why?" You do propose to add 52 more inspectors general to audit what? That is going to increase audits 10 percent. Is that the idea?

Mr. ZUCK. It would increase the total staff to a level of 516.

Senator ABDNOR. Yes, I believe you said you would increase audits by 10 percent over fiscal year 1982. Did I pull that out of your statement?

Mr. McBRIDE. Mr. Chairman, it would increase total staff by 10 percent and the total number of audits by 40 percent. I think more importantly, in addition to increasing the number of audits, it enables us to apply audit oversight to some major programs such as unemployment insurance and workers' compensation where, historically, there has not been a high level of audit attention.

In our view, there is a lot of money that can be saved by increased audit coverage in those areas.

Senator ABDNOR. That would mostly be where it would be concentrated?

Mr. MCBRIDE. That and CETA. CETA has been our stock in trade, if you will, for the audit business in the Department of Labor and has so preoccupied our audit staff that they have given insufficient attention in the past to these other multimillion dollar program areas.


Senator ABDNOR. How much is budgeted for the contractual audit work in fiscal 1983 as compared to fiscal 1982?

Mr. McBRIDE. It will be slightly over $17 million, which represents a very substantial increase. A large part of that is due to the need to provide greater audit coverage of the unemployment insurance program.

You know that UI program benefits approach $17 billion. There has been very little Federal audit effort there. There are error rates, overpayment rates, which we are very concerned about. We think we can have a significant impact in reducing fraud and waste in that program.

Basically, these audit contracts are both for governmental audit groups who would do the audit work and for private certified public accounting firms who do the work on contract for us.

Senator ABDNOR. They will be intensified?
Mr. McBRIDE. That's correct.
Senator ABDNOR. The audit policy.

WOMEN'S BUREAU TRAINING EFFORTS In your training programs, what does the Women's Bureau intend to do to encourage local sponsors of Federal employment training programs to more adequately address the employment of and training needs of women?

Do you have any thoughts on that?

Dr. ALEXANDER. We are already working very closely with local government officials, providing technical assistance to them to assist women in moving into some of the job training opportunities that are available to them.

Senator ABDNOR. With your existing resources, has the Women's Bureau been able to provide technical assistance to CETA prime sponsors to overcome the sex stereotyping in job placement?

Dr. ALEXANDER. To this point, we have been.

Senator ABDNOR. To what extent does the Women's Bureau support employment and training programs for women in skilled, nontraditional jobs?

Dr. ALEXANDER. During fiscal year 1982, we have had an initiative for increasing the number of women in apprenticeship positions. This initiative is operating in all 10 of our Federal regions. We are holding regional training workshops to provide information, materials, and assistance to employers, union officials, and others; and, we have already seen an increase in women moving into apprenticeship jobs.

DEMONSTRATION PROJECTS Senator ABDNOR. Ms. Alexander, how does the Women's Bureau intend to utilize the $1 million of the CETA funds earmarked for demonstration, employment, and training projects?

Dr. ALEXANDER. We will be working with our regional offices in establishing model projects to enable women to enhance employment opportunities. Also, we will work closely on alleviating some of the sex stereotyping that women have encountered in the past.

We will be sponsoring conferences on issues of concern to working women, such as child care and women in management. By addressing the support services needed for women to work, we will help women move into well-paying employment.

Senator ABDNOR. How much are you earmarking in your 1983 budget for that?

Dr. ALEXANDER. Funds have not been earmarked in the 1983 budget at this point, but I am certain the Secretary will be allocating some funds to the Women's Bureau for program initiatives.

IMPACT OF PROGRAM DECREASE Senator ABDNOR. What will the impact of the proposed reduction in Women's Bureau staff from the 79 level down to 70 be? Will that have a great impact?

Dr. ALEXANDER. We will have to curtail some of our activities. For example, we will not be able to continue with the number of publications that we have prepared in the past and disseminated throughout

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