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1 Federal Mandatory Spending for Means-Tested Programs, 2008 to 2028 1 (June 2018)

handle is hein.congrec/fmsmtp0001 and id is 1 raw text is: JUNE 2018 Federal Mandatory Spending for Means-Tested Programs, 2008 to 2028 In its adjusted April 2018 baseline, the Congressional Budget Office projected that if current laws generally remained unchanged, total mandatory spending would amount to $2.8 trillion in 2018 and grow to $4.9 trillion in 2028.1 The average annual rate of growth over the coming decade would be 5.8 percent, compared with an average rate of 4.6 percent recorded over the past 10 years. Means-tested programs (which provide cash payments or other forms of assistance to people with relatively low income or few assets) currently account for a little more than a quarter of all mandatory spending. The largest means-tested mandatory programs are Medicaid, the earned income and child tax credits (which are refundable), the Supplemental Nutrition Assistance Program (SNAP), and the Supplemental Security Income program. The largest non-means-tested programs are Social Security, most of Medicare, and the federal civilian and military retirement programs. Mandatory spending on means-tested programs is projected to grow more slowly than spending for non- means-tested programs. CBO projects that under current 1. CBO's April 2018 baseline is described in Congressional Budget Office, The Budget and Economic Outlook: 2018 to 2028 (April 2018), www.cbo.gov/publication/53651. Since then, CBO has made a number of relatively small adjustments to its projections, which are described in Congressional Budget Office, An Analysis of the President' 2019 Budget (May 2018), p. 11, www.cbo.gov/publication/53884. Mandatory spending is governed by statutory criteria and is not normally controlled by the annual appropriation process. law, outlays for means-tested mandatory programs would grow over the next decade at an average annual rate of 4.4 percent, whereas spending for non-means-tested mandatory programs would grow at an average annual rate of 6.3 percent (see Table 1 on page 4).2 Those growth rates are boosted by shifts in the timing of certain payments. Because October 1, 2017 (the first day of fiscal year 2018), fell on a weekend, an estimated $40 billion in mandatory payments that were due on that day were instead made at the end of September 2017. As a result, mandatory outlays in 2018 were reduced by the amount of those payments. Similarly, mandatory outlays in 2028 will be boosted by the shift of an estimated $83 billion in payments from fiscal year 2029 to 2028 because October 1, 2028, also falls on a weekend. If not for those shifts, mandatory outlays for means-tested programs over the next decade would grow at an average rate of 4.2 percent, compared with 5.9 percent for non-means-tested programs. 2. The tables in this report exclude means-tested discretionary programs (such as the Section 8 housing assistance programs and the Low Income Home Energy Assistance Program), which are controlled by annual appropriation acts. However, each table shows discretionary spending for the Federal Pell Grant Program as a memorandum item because that program has discretionary and mandatory components and the amount of the mandatory component depends in part on the amount of discretionary funding. Spending for the student loan program is generally not considered to be means-tested, although that program has means- tested components. Note: Unless otherwise specified, all years referred to in this report are federal fiscal years, which run from October 1 to September 30 and are designated by the calendar year in which they end. Numbers may not sum to totals because of rounding.

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