Office of Management and Budget Director Jack Lew told all federal agencies to cut at least five percent off discretionary spending when submitting 2013 budget requests in a memo sent Wednesday.
Lew also told agencies to identify additional discretionary fund reductions that would bring the request to at least 10 percent below its 2011 enacted discretionary appropriations to provide OMB with options when arranging the annual federal budget.
“By providing budgets pegged to these two scenarios, you will provide the President with the information to make the tough choices necessary to meet the hard spending targets in place and the needs of the Nation,” Lew wrote.
The cuts are aimed to help in the Obama Administration’s plan for $4 trillion in deficit reductions that would put the government on a path toward financial stability, Lew said. He continued that the cuts should help agency heads re-prioritize their needs and cut areas of wasting while investing in critical areas to job creation and economic growth.
“I know this will be a difficult year,” Lew wrote, “but it will also offer an opportunity to make the hard decisions to invest where we can get the most done and pare back in other areas.
Lew said that the 2013 budget and management plans should address the following mechanisms for efficiency increases:
- If relevant, identify priority investments related to economic growth which the Department proposes to expand or protect, stating the strongest possible case for the positive economic impact.
- Identify and include in the budget submission cost-saving efforts that will improve operational efficiency and improve the rate of return to taxpayers, including more program integration, reorganizations within and between agency components, and realignment of resources (such as information technology, facilities, and staff) to improve service delivery to the public.
- To drive long-term productivity increases, your 2013 budget and management plans should explain how your agency will acquire, analyze, evaluate, and use data to improve policy and operational decisions, and how you will reallocate and strengthen your analytic and evaluation capacity to set outcome-focused priorities, identify the most effective and cost-effective practices and programs, and speed their adoption.
- Finally, agency submissions should take into consideration areas of duplication or overlap identified by the Government Accountability Office, as well as others.