The Budget Enforcement Act of 1990: The Path to No Fault Budgeting

The Budget Enforcement Act of 1990, included in the controversial and comprehensive budget legislation passed by Congress in October, makes a number of significant changes in federal budgeting. It shifts the focus of the budget process from deficit reduction to spending control, provides five-year spending totals and mini-sequesters for defense, international and domestic appropriations, and puts entitlements and revenue expenditures on a pay-as-you-go basis. The Gramm-Rudman-Hollings deficit targets have been raised substantially, Social Security surpluses taken out of the deficit calculation and allowance made for further adjustments for inflation, Operation Desert Shield, and other emergency spending, minimizing the prospect for general sequestration. OMB has been given important new estimating authority and the roles of the congressional committees involved in budgeting have been altered.     

Congressional Budget Reform: Impact on the Appropriations Committees

The congressional budget process has undergone several major reforms in the last twenty years: the Congressional Budget and Impoundment Control Act of 1974, the Balanced Budget and Emergency Deficit Control Act of 1985 and 1987 (Gramm-Rudman-Hollings I and II) and the Budget Enforcement Act of 1990 (BEA) that have had a direct impact on the Appropriations Committees and the appropriations process. This article evaluates that impact on the decision-making capacity and power of the Appropriations Committees.     

Scrutiny in English Local Government and the Role of Councillors

Overview and Scrutiny Committees were introduced in England and Wales in the Local Government Act 2000 that ended the role the full council and its committees as the locus of decision‐making for most local authorities. Overview and scrutiny committees composed of councillors not on small decision‐making executives were tasked with holding these to account. The performance of scrutiny committees is variable. Generally they work best where they concentrate on reviews of policy and practice, with recommendations following from well‐researched reports. The paper reviews the difficulties which arise when scrutiny committees endeavour to hold powerful executives to account, and suggests that to strengthen this new legislation is required, in particular to institutionalise scrutiny committees as agencies of the full council, the representative body for the area, comparable to the way in which the select committees at Westminster are the agencies of the Parliament.     

The Fatal Defect in the Federal Accounting System

For many years, the federal accounting system has focused on obligations. Beginning in 1949, several blue-ribbon committees recommended changing the focus to expenses. Focusing on expenses provides more useful information than focusing on obligations for both planning and control purposes. Unfortunately, the House Appropriations Committee continues to make appropriations on an obligation basis. The Federal Accounting Standards Advisory Board (FASAB) has developed a system that focuses on both expenses and obligations that was supposed to be operational in 1997 but in fact will not be operational until 2003 at the earliest. Even then, users will not pay much attention to the expense focus if funds continue to be appropriated on an obligation basis.     

THE GOVERNMENT AND HOSPITAL COMMITTEES OF MANAGEMENT IN VICTORIA

Abstract: A new method has recently been introduced for selecting members of Victorian hospital committees of management: they are to be appointed by the Minister of Health, instead of being nominally elected by "contributors" to the hospitals. The 1977 Health Commission Act, which contains these new appointment provisions, gives the state government additional powers over the hospitals, and the power to appoint committees of management could contribute to this augmented control. The new method of selection, however, is expected to make little difference in practice to the committees. Neither the former Liberal state government, in framing the Health Commission Act, nor recent official inquiries have considered seriously the capacity of these committees as they are now constituted to maintain a high degree of hospital autonomy, despite the hospitals' heavy reliance on public funds. By leaving undisturbed these inheritors of the voluntary hospital tradition, the former Liberal government, though it has left its Labor successor with some new powers, has left it also with a potential obstacle to implementing the kinds of reforming measures recommended for the state's health services.     

Spending Preferences of Public Sector Officials: Survey Evidence from Finland

We examine the determinants that shape the spending preferences of public sector officials on several budgetary appropriations. Following Niskanen's budget‐maximizing theory, we test whether these officials prefer larger budgetary appropriations rather than less. We measure their preferences to increase their own bureau's appropriations and compare those against their preferences for other bureaus' appropriations. The empirical evidence is gathered via a mail survey targeting high‐level officials from different ministries in Finland. The analysis of the responses suggests that Niskanen's theory is in part supported.     

A call for budget reform

This article calls for reform of the U.S. Federal budget from two perspectives, preparation and content. The first aspect of reform proposes to amend the Budget and Accounting Act of 1921 by eliminating the requirement for an executive budget. It proposes replacing the executive budget submission with a budget prepared by a joint executive-legislative council. While the decision-making process for approval of the budget would remain the same, the council-proposed budget would eliminate several time consuming issues of disagreement such as whose economic estimates are used. The second aspect of reform proposes an examination of the contents of the budget. The current budget focuses on agency appropriations and the debt/surplus figure. Many more issues such as unfunded pension liabilities, true costs of credit, value of government-owned assets and the number of appropriations are largely neglected. This aspect of the budget should be examined by a non-partisan group of experts to make recommendations for an improvement in the informational content of the budget. Improved information could help support sound decisionmaking. The article contends that we can preserve the constitutional separation of powers dealing with the budget while we simply improve the methods used to prepare the document itself, and once the document is prepared it would be structured so it can be examined in a meaningful manner by interested citizens in order to ascertain the financial conditions of the country.     

The Bush Administration's Proposal for Credit Reform: Background, Analysis, and Policy Issues

Large recent and forecasted federal outlays to cover losses on deposit insurance and federally-assisted credit have increased concern in the executive and legislative branches about potential future liabilities of the federal government. These potential liabilities include federal credit; consequently, this renewed interest in federal credit reform. Credit reform would have to change the budgetary treatment of federal direct loans and federal guaranteed loans. Currently, the unified budget measures the cost of federal credit on a cash flow basis. Critics (including the Bush Administration) maintain that the appropriate budgetary measure of the costs of federal credit is the present value of the subsidies to credit recipients in the fiscal year that the credit is advanced. The Bush Administration's proposal for credit reform is presented in most detail in the Federal Credit Reform Act of 1989 (the Act), which was proposed but not enacted. The Act would have had federal officials estimate credit subsidies based on the equivalent interest rates in private credit markets. These subsidies would have been used to measure the budgetary cost of federal credit and would have required annual appropriations. Two credit revolving funds would have been established in the Treasury to finance credit flows. Many of these credit reform practices were included in the Omnibus Budget Reconciliation Act of 1990 though.     

Implementing the GPRA: Examining the Prospects for Performance Budgeting in the Federal Government

The Government Performance and Results Act (GPRA) is the latest in a series of attempts to introduce performance-based management and budgeting techniques at the federal level in the United States. In the past, these attempts largely failed due to administrative complexities, lack of investment in managerial, accounting, and information systems, and the absence of institutional incentives to promote gains in economic efficiency. Whereas we find the objectives of the GPRA laudable, we question whether this current incarnation of performance budgeting can succeed in transforming the traditional focus of federal budgeting from annual appropriations and obligations to multiyear outputs and outcomes.     

A Comment on "The Great Unraveling: Federal Budgeting, 1998–2006"

To declare that the federal budgetary process is in utter shambles based principally on an analysis of a six-year interval during a single presidential administration, as Professor Irene Rubin does in the preceding article, is unfair to history and misleading. Drawing on significant budgetary experience as a U.S. Senate staff member, the author of this essay argues that (1) the contributions of emergency appropriations and earmarks to the federal budgetary imbalance are overstated, (2) the goal of perpetual budgetary balance is unsound policy, and (3) budgets—inevitably the result of a political process—are artifacts reflecting societal priorities at a given point in time.     

Before There Was Enron,There Was Orange County: A Study of Local Government Financial‐Oversight Committees

Recent financial scandals in some of America's largest corporations have prompted popular speculation that a similar crisis may occur within the public sector and, therefore, that government and nonprofit organizations should be required to adopt financial oversight practices similar to those that are mandated of publicly‐traded corporations in the Sarbanes‐Oxley Act of 2002. One of those mandated practices—the use of financial‐oversight committees—is already a common practice in public organizations, though little is known about its effectiveness. This study uses a national sample of local governments to examine whether financial‐oversight committees improve financial control and strengthen stakeholder confidence in financial reporting. The findings provide preliminary support for the use of financial‐oversight committees as an effective tool to improve financial accountability in local government.     

The Rise and (Relative) Fall of Earmarks: Congress and Reform, 2006–2010

Congressional earmark reform efforts began in 2006. This paper reviews the literature on earmarks and documents the rise and relative fall in earmark spending using four databases. It identifies and critiques earmark reforms, including congressional rules and initiatives taken by the appropriations committees and congressional party organizations. Rules and committee‐initiated reforms were the most effective, producing significant improvements in transparency and expediting availability of information. The number of earmarks and their dollar value first dropped noticeably in 2007 after an earmark moratorium, then stabilized as reforms were implemented. It is premature to conclude that reforms will alter the policy content of earmarks or their distribution.     

The many faces of EU committee governance

Committees linking national administrations and the EU level play a crucial role at all stages of the EU policy process. The literature tends to portray this group system as a coherent mass, characterised by expert-oriented ‘deliberative supranationalism’, a term developed through studies of comitology (implementation) committees. This article builds on survey data of 218 national officials in 14 member states who have attended EU committee meetings. These groups exhibit important common features: expert knowledge rather than country size plays a pivotal role in the decision making process; across types of committee, participants evoke multiple allegiances and identities. In spite of loyalty to national institutions, there is also a sense of belonging to the committees as such, though with significant variation among types of committee. Council and comitology groups are strongly intergovernmental, while Commission committees seem more multi-faceted. The primary aim here is to give an empirical account, but the main observations are interpreted from an institutional and organisational perspective.     

Recovery and Reinvestment Act spending at the state level: Keynesian stimulus or distributive politics?

We examine the US state-level pattern of American Recovery and Reinvestment Act (ARRA) spending. We relate spending to (1) Keynesian determinants of countercyclical policy, (2) congressional power and dominance, and (3) presidential electoral vote importance. We find that the ARRA is, in practice, poorly designed countercyclical stimulus. After controlling for political variables, coefficients on Keynesian variables are often statistically insignificant. When they are statistically significant they are often the “incorrect” sign. On the other hand, statistically significant effects are associated with majority party House of Representative appropriations subcommittee and authorization committee membership. One striking result is that the elasticity of ARRA spending with respect to the pre-ARRA ratio of federal grants and payments to federal taxes paid is estimated to be greater than unity in most specifications. States previously capturing large amounts of federal funds continue to do so under the ARRA stimulus.     

Localism in Practice: Investigating Citizen Participation and Good Governance in Local Government Standards of Conduct

This article examines how, against a background of localism endorsed by the 2010 coalition government in the United Kingdom, a key component of local integrity and governance was fundamentally altered. The Localism Act 2011 abolished the English local integrity framework, which relied on the participation of local citizens in the policy making and implementation of local government standards of conduct. The article utilizes Henrik Bang's concepts of “expert citizen” and “everyday maker” to explore citizen participation in local standards committees. Using a case study approach, the article demonstrates how standards committees shaped processes and practices in the local governance of integrity. The authors argue that standards committees were crucial in promoting local participation and enhancing good governance.     

The Budget Enforcement Act and Its Survival: Congress Hears from Experts

The unpopularity of the Budget Enforcement Act of 1990 grew in light of the recession, recent international events, and continuing record budget deficits. This prompted many Congress members and congressional committees to consider the future of the Budget Enforcement Act of 1990. Two hearings, held in October and November of 1991, exemplify the kinds of choices facing the Congress and the type of advice that Congress has been receiving. This article reviews the testimony given at the hearings by experts with established knowledge of federal budgeting.     

The Strange Budgetary Politics of Agricultural Research Earmarks

This article explores how members of the House and Senate Subcommittees on Agricultural Appropriations use the appropriations process to earmark special grants for agricultural research projects without forming a majority logroll. It also shows how subcommittee members coerce the USDA into administering individual earmarked research grants even though the precise allocation of these grants does not have the force of law. This article makes an important contribution because it analyzes an institutional development within the appropriations process that has not been explored in the existing literature, and it examines the consequences that this development has had on the quality of USDA‐funded agricultural research.     

The Democratic Legitimacy of the European Union Committee System

This article investigates both the operation and the democratic legitimacy of the European Union committee system. This vast but rarely studied system is an important site of European governance, exercising an increasing amount of policy responsibility while also providing the essential arenas necessary for supranational problem solving. Despite their contribution to the success of the “European project,” committees are increasingly coming under attack, notably for their lack of democratic credentials. The article employs original empirical research based on interviews and internal documentary evidence to answer a timely question: does the EU committee system strike an appropriate balance between the values of system effectiveness and democratic legitimacy? Following the application of a set of democratic principles to EU committees, the article finds that a poor balance has been struck between effectiveness and democracy. The article concludes with some operational suggestions for improving this balance in the short‐to‐medium term.     

Legislatures and civil‒military relations in the United States and the United Kingdom

Abstract

Legislatures in separation of powers systems like the US are often portrayed as having far greater capabilities and willingness to change defence policy than are parliaments in Westminster systems. This paper uses principal?agent models and hypotheses on legislative will to review the role of defence committees in the US Congress and Britain’s parliament during each country’s most recent, significant change in civil?military relations. Congressional committees drafted the 1986 Goldwater?Nichols Act over the objections of the president, fundamentally changing US civil?military relations. We would expect the British House of Commons to be at the opposite end of the spectrum, unable and unwilling to act without the prime minister’s blessing. At first glance, this is indeed what happened during Britain’s 2011 Defence Reform effort. Parliament took no concrete, independent action. A closer examination, however, suggests that parliamentary committees helped set the agenda for the 2011 reforms. These results point to the need to carefully assess both legislative capabilities and will when examining the role of legislatures in foreign policy, as well as the indirect means by which parliaments affect security policy.