103D CONGRESS 2d Session SENATE REPORT 103-221 SOCIAL SECURITY ADMINISTRATION INDEPENDENCE ACT OF 1993 JANUARY 25, 1994.-Ordered to be printed Mr. MOYNIHAN, from the Committee on Finance, REPORT [To accompany S. 1560] The Committee on Finance, to which was referred the bill (S. 1560) a bill to establish the Social Security Administration as an independent agency, and for other purposes, having considered the same, reports favorably thereon without amendment and recommends that the bill do pass. I. PURPOSE AND SCOPE The Committee bill would alter the organizational status of the Social Security Administration, removing it from its current status as a component within the Department of Health and Human Services and establishing it as an independent agency within the executive branch. The agency would be responsible for administering the Social Security Old-Age, Survivors, and Disability Insurance programs and the Supplemental Security Income program. The bill provides for the governance and the necessary functions and authorities of the agency. Present Law II. EXPLANATION OF PROVISIONS Responsibility for administration of the Old-Age, Survivors, and Disability Insurance (OASDI) programs and the Supplemental Security Income (SSI) program is vested in the Secretary of Health and Human Services. The programs are administered by the Social Security Administration, a component of the Department of Health and Human Services. SSA is headed by a Commissioner appointed by the President and directly responsible to the Secretary. Reasons for change The January 1983 Report of the National Commission on Social Security stated that a majority of the members believed, as a broad general principle, that "it would be logical to have the Social Security Administration be a separate independent agency." The Commission recommended that a study be conducted of the feasibility of converting SSA to an independent agency within the executive branch. Following the National Commission Report, in the Social Security Amendments of 1983 the Congress commissioned a study of how to make SSA independent. The study was conducted by a three-member panel headed by Elmer Staats, former Comptroller General of the General Accounting Office. The panel concluded that an independent Social Security Administration should be headed by a single administrator appointed by the President with the advice and consent of the Senate, and that a permanent, bipartisan Social Security Advisory Board should be established to permit independent review and encourage broadly based policy analysis. The panel recommended that the independent agency be responsible for administering the Social Security Old Age, Survivors, and Disability Insurance programs and the Supplemental Security Income program. In 1989, the General Accounting Office was asked to help the Congress in its determination of the appropriate management structure for an independent Social Security agency. At issue was whether the agency should be governed by a board or a single administrator. In its September, 1989 report, the GAO concluded that "a single administrator would be the best management structure for SSA." In arriving at this conclusion, the GAO reviewed the management experience of different agencies and studies undertaken by other organizations. The reasons the GAO report gave for arriving at this conclusion were stated as follows: Though a single administrator would not be a panacea, the evidence we found suggests that such an administrator would be more effective in managing SSA than a board *** Our work-and the work of others that we have reviewed-suggests *** that, in practice, the board form of organization has not proven effective in providing stable leadership, in insulating decisions from political pressures, and in assuring that diverse viewpoints are considered in the decision-making process *** We recognize that a board could give the Congress and the executive branch a valuable source of informed opinion about major Social Security policy issues. We believe that this can be achieved without sacrificing management effectiveness if the board is created as a Social Security policy advisory board *** The board, however, should have no role in the management of SSA. Similarly, in a 1984 report to the Congressional Panel on Social Security (the Staats Panel), the National Academy of Public Administration concluded that: 1. In management terms, the most important point is that it is almost universally agreed that single administrators are far more effective and accountable than multi-person boards or commissions, bipartisan or otherwise. 2. Again in management terms, a board is not a necessity and is not desirable. Even if a board's role is carefully defined and its membership carefully selected, history strongly suggests that it is almost impossible to keep such a board from interjecting itself into the management of the organization which it stewards. While such interjections are occasionally useful, the likelihood is that they would end up confusing and debilitating the authority of the agency head, creating conflict for the staff, and becoming another layer of management which adds little and detracts much. Furthermore, the composition of such boards becomes an issue in itself, and all too often breeds preoccupation with diversionary issues of balance, representativeness, or political fairness, rather than the ability of such boards to contribute to the success of the program. As a result of these studies, as well as testimony on the subject of an independent agency before the Committee, the Committee strongly believes that creating an independent Social Security agency, on the model recommended by the Staats Panel and the GAO, would improve administration of the Social Security program and increase public confidence in the Social Security system. Independence based on this model would help to assure strong, effective leadership for the Social Security program. It would provide strong incentives for development of the program and operational policies of the agency in a bipartisan manner, and would better enable SSA to be guided by its traditional objective of providing the highest quality service to the public. Independence as recommended by the Committee would increase the ability to obtain and retain the most experienced and capable leadership for the agency, and to enhance the agency's stature within the executive branch. Summary of principal provisions The Committee bill establishes the Social Security Administration as an independent agency by amending the Social Security Act and related statutes in the following manner: Section 101.-Establishment of Social Security Administration as a separate, independent agency Section 101 would establish the Social Security Administration as an independent agency in the executive branch of the Government, with responsibility for the administration of the Old-Age, Survivors, and Disability Insurance (OASDI) programs, and for the SSI program. Under current law, the Social Security Administration is a subordinate component of the Department of Health and Human Serv ices, and is responsible for administering OASDI programs, SSI, and part B of the Black Lung program. During recent years there has developed the widespread perception that the quality of the service provided by the Social Security Administration has declined, and that its commitment to high-quality public service has diminished. At the same time, SSA has undergone great change, which in part accounts for the difficulties the agency has experienced in achieving its mission. This change has included several major reorganizations and a substantial reduction in its workforce. In earlier times, SSA was frequently cited as a model for providing the public with accurate, prompt and courteous service. Because so many people depend on Social Security for their essential needs, it is vital that SSA again achieve the level of excellence that was once its standard. To achieve this goal, the Committee bill establishes SSA as an independent agency. Section 102.-Commissioner of Social Security and other offi cers Section 102 establishes the office of Commissioner of Social Security, appointed by the President with the advice and consent of the Senate. The Commissioner would be appointed for a 4-year term coinciding with the term of the President (or until the appointment of a successor), and would be compensated at the rate for level I of the Executive Schedule (equivalent to Cabinet officer pay). The Commissioner would be responsible for the exercise of all powers and the discharge of all duties of SSA, have authority and control over all personnel and activities of the Agency, and serve as a member of the 5-member Board of Trustees (the Secretary of Labor would no longer be a member of the Board of Trustees). The duties of the Commissioner would include prescribing rules and regulations; establishing, altering, consolidating, or discontinuing organizational units and components of the agency (except those prescribed by law); and assigning duties and delegating, or authorizing successive re-delegations of, authority to act and to render decisions, to such officers and employees as the Commissioner may find necessary. The Commissioner and the Secretary of Health and Human Services would be directed to consult with one another on an on-going basis to assure: (1) the coordination of the Social Security, SSI, Medicare and Medicaid programs and (2) that adequate information concerning Medicare and Medicaid benefits will be available to the public. Under the bill, the Commissioner would be responsible for the day-to-day administration of the Agency and would also be the chief policy maker of the Agency. This form of governance would provide SSA with a favorable organizational environment in which to develop goals and objectives and to address and resolve major problems and issues promptly. It is also the form recommended by the Staats Panel, the GAO, and National Academy of Public Administration. Equally important, however, is the selection and retention of an experienced and capable administrator. Over the past twenty years, SSA has been plagued by a lack of stability and continuity in its executive leadership. During this time, seven individuals have held the position of Commissioner of Social Security on a permanent basis, and five more have been acting. By establishing a fixed term of office for the Commissioner, and by providing that the Commissioner will be compensated at a level equivalent to a cabinet officer, the Committee bill enhances the likelihood that SSA will attract and retain first-rate leadership. The Committee expects that increased continuity of leadership will in turn lead to the development of far sighted policies and administrative practices and the establishment of coherent long-term administrative plans and initiatives. A Deputy Commissioner would be appointed by the President, with the advice and consent of the Senate, for a 4-year term coinciding with the term of the Commissioner or until appointment of a qualified successor. The Deputy Commissioner would perform such duties and exercise such powers as are assigned by the Commissioner, and serve as acting Commissioner during the absence or disability of the Commissioner (or vacancy of office) unless the President designates some other official to serve as acting Commissioner. In addition, the Deputy Commissioner would serve as the Secretary of the Board of Trustees of the Old Age, Survivors, and Disability Insurance Trust Funds. The Deputy Commissioner would be compensated at the rate provided for in level II of the Executive Schedule. In its testimony before the Finance Committee on September 14, 1993, the General Accounting Office offered a "cautionary note about filling SSA's top management positions with political appointees," and the Committee shares that concern. As the GAO has advised in the past, it is vitally important that the agency's top management include career civil service employees who can provide operational continuity and an institutional memory. It is the view of the committee that career employees and others who are qualified by virtue of their experience in Government and knowledge of social insurance programs, should be considered in filling SSA's top management positions. The bill does not require the establishment of any other positions in the Administration. The Committee believes that it is preferable to give the Commissioner the authority to determine the most efficient administrative organization for an independent SSA. However, it is the Committee's view that an essential element in any administrative organization for SSA is the position of Chief Actuary. While such a position is not mandated legislatively, it is expected that SSA will continue to have a Chief Actuary, and that the Chief Actuary would remain available to consult with the Chairman of the Senate Finance Committee and the Chairman of the House Ways and Means Committee. The Committee wishes to emphasize the very important role of the Office of the Actuary in assessing the financial condition of the Social Security trust funds and in developing estimates of the financial effects of potential legislative and administrative changes in the Social Security program. The Office of the Actuary has a unique role within the agency in that it serves both the Administration and the Congress. While the Committee expects that the Chief Actuary will report to the Commissioner, this office often must work with the committees of jurisdiction in the development of legislation. |