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SOCIAL SECURITY ADMINISTRATION

STATEMENT OF GWENDOLYN S. KING, COMMISSIONER

ACCOMPANIED BY:
DENNIS P. WILLIAMS, DEPUTY ASSISTANT SECRETARY, BUDGET,

DEPARTMENT OF HEALTH AND HUMAN SERVICES
JOHN R. DYER, DEPUTY COMMISSIONER FOR FINANCE, ASSESS-

MENT, AND MANAGEMENT
LOUIS D. ENOFF, DEPUTY COMMISSIONER FOR PROGRAMS

BUDGET REQUEST Senator HARKIN. Our next witness is Gwendolyn King, Commissioner of the Social Security Administration.

Mrs. King, welcome again to the subcommittee.

In fiscal year 1992, the Social Security Administration will pay out $307 billion in benefits to 42 million Americans. Not only will 36 million elderly Americans receive payments, but 6 million disabled and blind Americans also receive the vital assistance they need.

The Social Security Administration reaches into almost every city, town, and village in America-1,300 field offices and a staff of 64,530. The budget request for administrative costs is $4.5 billion, an increase of $374.6 million over last year. A supplemental $232 million is also being requested to handle the surge of claims under the Zebley case.

Despite the additional resources being requested, it appears that services to the public are in danger of deteriorating. Telephone busy signals rates remain high, the backlog of disability cases continues to grow.

This, again, is an issue that Secretary Sullivan has acknowledged, but one for which the administration has not found the needed funds to remedy.

Commissioner King, again, we welcome you back to the subcommittee. In the interest of time, please summarize your budget request so that we can get to the questions more quickly. Of course, your entire prepared statement will be made a part of the record and please proceed as you so desire.

OPENING REMARKS

Mrs. KING. Thank you, Mr. Chairman, and I appreciate very much your giving me this opportunity. We have submitted a longer statement for the record.

I would like to take a few moments to discuss our $4.5 billion request for SSA's fiscal year 1992 administrative expenses, as well as certain critical funding needs we have for the current_fiscal year, most notably, the $232 million supplemental for Zebley, which you mentioned in your opening remarks.

I want to tell you what these requests mean in terms of this agency's ability to serve the millions of people whose lives are directly and strongly affected by Social Security.

Our fiscal year 1992 budget request is a conservative one, Mr. Chairman. One that reflects this Nation's need and this administration's desire for fiscal restraint.

We are requesting a 9-percent increase for fiscal year 1992. That appears to be a substantial raise under the new budget rules. But it is bare bones given the magnitude of our built-in mandatory cost increases and the amount of work to be done.

Administrative expenses will continue to make up less than 2 percent of the overall cost of the programs we manage, and 80 percent of the increase we are requesting will be devoted to mandatory increases in payroll and other costs, such as rent and utility charges for hundreds of offices throughout the country.

In addition to those unavoidable, built-in increases, this request is driven by the substantial increase in SSA's workloads, an increase requiring additional FTE's, increased funding for State disability determination services, and further investments in systems modernization.

In addition to the expected increases in the Nation's over 65 population, we are seeing dramatic jumps in the number of people applying for disability and supplemental security income benefits.

BUDGETARY OBJECTIVES

The $4.532 billion the administration is requesting will accomplish the following objectives. First, we will be able to increase employment to 63,730 FTE's, an increase of about 750 FTE's from the amount currently funded for 1991. This will partially compensate for an anticipated workload growth, and in general, help to maintain present levels of service.

Recognizing that this is a budget aimed at achieving both service quality and fiscal responsibility, we may see some areas, particularly disability, where increases in the number of cases pending and increases in processing times will result.

Second, we will provide a funding increase of nearly 9 percent to our partners in the State disability determination services whose workloads will continue to increase significantly.

And third, this budget will enable us to restore limited funding to critical areas that have been severely cut in recent years. It is simply not acceptable for the Social Security Administration to have offices in disrepair, offices devoid of necessary supplies, or offices with equipment that does not work properly.

And finally, Mr. Chairman, this budget will enable us to make necessary investments in our computer and telecommunications systems to help us deal with future workload growth and improve public service.

In short, this budget request is designed to enhance both our human and our technological potential-enhancements that must take place if we are going to meet current and future workload demands and provide quality service. And providing that service, Mr. Chairman, hinges to a very great degree on three separate actions.

First and foremost, Mr. Chairman, I cannot urge strongly enough the adoption, without alteration, of the President's request for SSA's fiscal year 1992 administrative budget, $4.482 billion in direct obligational authority with $50 million in a contingency fund.

SSA is a production-driven agency and our production demands are steadily increasing. In order to meet those demands and to continue to serve the American public with efficiency, with courtesy, and with compassion, approval of this appropriation request is absolutely essential.

Second, we do need rapid congressional approval of the full, fiscal year 1991 supplemental appropriation of $232 million to process the anticipated workloads arising from the Supreme Court's Zebley decision.

The Zebley work, involving a probable 200,000 to 300,000 new childhood disability determinations was not covered in our regular fiscal year 1991 appropriation or our fiscal year 1992 request. Providing less than the full amount requested would impair our ability to deal fairly and efficiently with the children affected by the Zebley decision.

And finally, we need additional funds for our fiscal year 1991 “Limitation on administrative expenses" (LAE) account. These funds are made necessary by the workload increases which I spoke of earlier. More specifically, our pending disability claims in the State agencies are up 30 percent over last year. Pending claims, overall, are up over 20 percent. Pending appeals and receipt of new appeals are up, both of them, over 10 percent.

Right now, we have a window of opportunity to attack these caseloads and get them to manageable levels. To do so, however, requires immediate additional funding. Without it, these workloads will grow to an extent that will be much more difficult to get under control and the quality of our service will suffer.

As you know, Congress shifted nearly $100 million in fiscal year 1991 from direct obligational authority into our contingency fund so that this fund now contains $146 million. We have requested that OMB release $125 million from this fund.

The House Appropriations Committee has acknowledged SSA's needs by including a provision in the fiscal year 1991 supplemental bill that would transfer $100 million from the contingency fund and make it available for our operational needs.

PREPARED STATEMENT

These necessary actions, Mr. Chairman, for both this fiscal year and the next, will determine how well Social Security is able to serve the retirees, the families, the children, the people with disabilities, the financially needy and the millions of others who depend on the services we provide.

I would be happy to answer any questions now. [The statement follows:

STATEMENT OF GWENDOLYN S. KING

Fiscal Year 1992 Appropriation Requests

Mr. Chairman and members of the Committee, I am pleased to be here today to

present the fiscal year 1992 appropriation requests of the Social Security

Administration (SSA). These requests total $22.9 billion in budget authority, and reflect

SSA's commitment to fulfill its unique role in assuring the well-being of millions of

Americans. First, I would like to summarize the SSA appropriation requests before the

Committee:

$41.0 million for Payments to Social Security Trust Funds. Through this

account the trust funds are reimbursed for the costs of certain benefits and

administrative expenses chargeable to Federal funds.

$820.3 million for Special Benefits for Disabled Coal Miners. These funds

cover benefit payments and administrative expenses for that portion of the

black lung program administered by SSA.

$17.5 billion for the Supplemental Security Income (SSI) Program. This

request includes SSI benefits and reimbursement to the Social Security trust

funds for the administrative costs of the SSI program.

$4.5 billion for the Limitation on Administrative Expenses (LAE). This request

provides resources for administering the old-age and survivors and disability insurance programs and for performing certain administrative functions for the

Medicare program. It also includes resources to administer the SSI program

and for combined annual wage reporting for Social Security and Internal

Revenue Service purposes. The trust funds subsequently are reimbursed from

the general fund for the administrative costs of the SSI program and for the

nontrust fund share of annual wage reporting. The LAE request includes

about $3.4 billion for regular salaries and expenses, $868 million for State

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