The House of Representatives in acting upon the 1958 budget for the Department, appropriated for the Office of the Secretary a total of $2,060,000, which is a reduction of $237,000 from the estimate. This allowance, after providing for the existing authorized staff and for mandatory increases, allows a staff increase of 10 positions out of the 35 that I mentioned as originally requested. Primarily, the increase will be used to provide minimum additional services such as file, messenger, and library services where we mentioned we would like 15 people. Five people would be allotted to serve the operating agencies of the Department in central services. Two people are to work in the field of aging. One person would be placed in program analysis, one in personnel administration and one would be assigned to the Director of the Administration. That is how we were thinking of using the 10 positions which have been permitted under the House increase. Restoration of the reduction is not being requested, which is consistent with the overall policy that we mentioned the first day we came before you. Ours is a policy of selected appeals from House action. We readily admit that this may preclude us from doing exactly the kind of coordinating and administering of the Department's program which we believe most appropriate, but we recognize it does permit some limited strengthening of the Office of the Secretary. Appeals for restoration have been restricted to the most urgent areas of program impairment. I certainly thank you for the opportunity to make this statement. Senator HILL. We are delighted to have had you. Secretary Richardson, would you like to add anything? Mr. RICHARDSON. No; thank you. I think we have had ample opportunity to make a complete statement. Senator HILL. Senator Thye, do you have any questions? Senator THYE. No; I think it has been well explained. Senator HILL. I want to say I am sorry we kept you so late. We very much appreciate your being here. Mr. PERKINS. We appreciate the attention you have given to our many activities. Thank you, too. OFFICE OF FIELD ADMINISTRATION SALARIES AND EXPENSES STATEMENT OF MR. CHESTER B. LUND, DIRECTOR, OFFICE OF FIELD ADMINISTRATION, AND MR. JAMES F. KELLY, DEPARTMENT BUDGET OFFICER APPROPRIATION ESTIMATE Salaries and expenses, Office of Field Administration: For expenses necessary for the Office of Field Administration, [$1,985,000] $2,355,000, together with not to exceed [$500,000] $708,000 to be transferred from the Federal old-age and survivors insurance trust fund. The House allowed an increase of $241,600, which is $60,100 less than requested. This increase includes $101,385 for mandatory items and $140,215 for 20 new clerical positions for increased workload payrolling, voucher examination, recuitment, records management, plus increases in miscellaneous objects. The House disallowed an increase of $60,100 for 5 administrative assistants with secretaries that were requested to relieve executive assistants in 5 of the largest regions of business-management supervision. The executive assistants are having to spend an increasingly great amount of their time assisting the regional director because of his heavy workload in program coordination resulting from the large amount of new legislation affecting the programs and to represent the regional director on a number of intradepartment committees. This reduction will not assure the thorough supervision of these business management activities. Activity II. Grant-in-aid audit A $158,500 increase is provided in the House allowance, a reduction of $2,000. The increase in ludes $67,670 for mandatory items and $90,830 for 6 new positions for the audit of State surplus property agencies and 7 new positions for auditing new and expanded programs. The reduction of $2,000 involves a minor adjustment in miscellaneous expenses. Activity III. State merit systems The House allowed an increase of $46,900, a reduction of $900. The increase includes $9,445 for mandatory items and $37,455 for 5 new positions, travel and related expenses. This will permit this activity to provide for the increased workload resulting from expanded program activities and the numerous requests of the States for technical assistance. Senator HILL. All right, we will take the "Office of Field Administration, salaries and expenses. Mr. Lund. Mr. LUND. Mr. Chairman and Senator Thye. I would like to make a brief summary statement on the situation in the Office of Field Administration as the full statement has been presented to you. Senator HILL. We will insert the full statement at this point. (The statement referred to follows:) STATEMENT BY DIRECTOR, OFFICE OF FIELD ADMINISTRATION ON "SALARIES AND EXPENSES, OFFICE OF FIELD ADMINISTRATION" Mr. Chairman and members of the committee, this opportunity to present the 1958 budget requirements for the Office of Field Administration is appreciated. I should like to highlight and summarize the budget requirements and direct your attention to the problems with which we are faced. With me are members of my staff who can then go into the estimate in whatever detail the committee wishes. SUMMARY OF THE ESTIMATE The 1958 budget estimate requests a total of $3,063,000, represented by a direct appropriation of $2,355,000 and $708,000 to be transferred from the OASI trust fund. This is a total increase of $510,000. This budget provides for 478 positions, an increased staff of 48 required to meet increased workload due primarily to the expansion of old programs and the enactment of new legislation. The bill as reported by the House allowed $3 million, a reduction of $63,000 which eliminated 10 of the 48 new positions requested. RESPONSIBILITIES This appropriation finances all of the activities of the Office of Field Administration except the handling of surplus property. These responsibilities include the operation of nine regional offices, including the cost of the regional directors and their immediate staffs and the provision of common business management services to operating agency staff located in or administered through the regional offices. These business management services consist of payrolling, voucher examination, accounting, personnel services, and office services such as purchasing, mail, messenger, mimeograph, supply and like activities. Also financed from this appropriation are the departmentwide grant-in-aid audit and merit system programs. CURRENT PROBLEMS The basic problem faced both by the regional offices and at headquarters is that of sustaining the steadily growing workloads resulting from the expansion of established Department programs and the development of new programs and activities. For example: Staff serviced by regional offices has increased from 7,850 in 1955 to an estimated 12,100 in fiscal year 1957. This represents an increase of more than 50 percent in the number of employees serviced by the regional offices. During the same period, the service staffs were increased by only 15 percent. The grant-in-aid audit function and the State merit systems services have also sustained an increase in workload resulting from new and expanded programs. Field administration This activity, in addition to covering the overall functions of the director's office, and the supervisory and coordinating responsibilities of the regional directors, also finances and operates the management services provided to the operating agencies by the regional offices. These offices cannot continue to perform their increasing tasks with their currently limited personnel. The staff requested numbers 299 positions, an increase of 30. Ten of the positions-five administrative assistants with secretaries—are required to relieve the executive assistant to the regional director of supervision of business management activities. In a number of the larger regions especially, the time required for participation in the expanding regular programs and in the new special areas of aging, rural development, migratory labor, civil defense, defense mobilization, and in the many other new fields of activity of the Department, is growing far beyond the capacity of the regional director. Accordingly, in these regions, the executive assistant is forced to be called upon to represent the regional director in many of the above areas and in negotiations with State and local officials, and other Federal agencies. The executive assistants are also required to meet the increasing calls for regional information needed by the Secretary's Office for use in nationwide policy development and operations planning. These rapidly growing additional tasks are removing many of the executive assistants, in large part, from their former thorough supervision of fiscal, personnel, and general services activities. At the same time, with expansion of programs, there are, of course, greatly increasing requirements for these services by the operating agencies. Further, because of the expanded programs of field inspection by Federal control agencies, such as GAO and CSC, it is essential that provision be made for maintaining proper supervision of regional service activities in order to assure compliance with regulations and instructions issued by the control agencies, and by the Department. The supervisory positions requested will assure proper attention to the service needs of the Department's program operations, and the maintenance of sound and efficient administration. Twenty of the positions are requested—5 in the fiscal sections, 6 in the personnel sections and 9 in the general services sections-in order to maintain adequate administrative services without overtime and to bring operations to a state of currency. This additional staff will enable the regional offices to keep abreast of the mounting service demands, and to maintain standards of performance quality and safeguards which have been forced to be, in a degree, neglected because of insufficient personnel. For example: It has been necessary to backlog work on items which can be temporarily deferred, for example, audits of time and leave, maintenance of application files, performance ratings, training of new employees, development of procedural instructions, classification and records management review and other items required for continuing effective operation. It is essential that we have sufficient staff to perform the various service activities adequately for the needs of program operations, and in accordance with established regulations. If the increase now requested is approved, the performance ratios for payrolling and personnel services in the regional offices to the number of persons served in 1958 will be 1 to 269 and 1 to 141 respectively. These ratios are still higher than the guides suggested in 1955 by the Bureau of the Budget of 1 personnel clerk to 110 persons served, and 1 payroll clerk for 250 persons served. Division of Grant-in-Aid Audits An increase of 13 positions is requested. The Division has the responsibility for auditing grants made to State agencies for 33 of the grant-in-aid programs administered by the Department through the Public Health Service, the Social Security Administration, the Office of Vocational Rehabilitation, the Office of |