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115774 1 (1981-06-24)

handle is hein.gao/gaobadytw0001 and id is 1 raw text is: UNITED STATES GENERAL ACCOUNTING OFFICE -JAShiNGTON, D.C. 20548 IS HEARING DATE JUNE 24, 1981 Statement for the Record Wilbur D. Campbell Acting Director Accounting and Financial Management Division General Accounting Office At the Request of the 115774 Subcommittee on Intergovernmental Relations Committee on Governmental Affairs U.S. Senate The Federal Government has a vital stake in State and local productivity improvement for two reasons: the national economy is strengthened by State and local productivity improvement and the effectiveness and efficiency of these governments directly affect the costs of the Federal assistance programs they admin- ister. Over the past twenty years, State and local governments have assumed positions of considerable economic importance. State and local budgets now account for roughly 13 per cent of the gross national product. While one in every six persons in the workforce is employed by government, State and local governments represent 80 percent of all public employment. At a time of increasing public pressure to curb government costs, improving the productivity of State and local governments can help control government spending and help fight inflation. State and local governments play an especially critical role in accomplishing national objectives. Through the Federal assistance system, these governments carry out many federally mandated programs, at times functioning as the administrative arm of the Federal Government and its national domestic polic- ies. It is through this'same assistance system that the Federal Government also has its greatest impact on State and local gov- ernment productivity. Together, the structure of Federal assist- ance programs and the management capacity of State and local gov- ernments administering them tend to determine the efficiency, effectiveness and costs of the programs. Those costs (i.e. Federal grant-in-aid outlays) for fiscal 1980 were in excess of $90 billion.

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