OMB pushes CFOs to lead cost-cutting effort

Budget

OMB pushes CFOs to lead cost-cutting effort

In a memo to agency financial managers, Danny Werfel set a July 31 deadline for three broad initiatives to reduce spending. Agency CFOs also must rank their emp...

Federal News Network Staff

June 30, 2011 2:59 pm

2 min read

By Jason Miller
Executive Editor
Federal News Radio

Agency chief financial officers must decide on three broad initiatives that will save significant amounts of money by July 31.

Danny Werfel, the Office of Management and Budget’s controller, said in a June 28 memo to agency CFOs that the cost-cutting efforts should include disposal of real property, consolidation of technology systems, improving inventory controls, as well as, more narrowly focused areas such as limiting travel or implementing tighter purchase card policies. CFOs must submit their plans to Werfel by the end of next month.

The memo is part of Vice President Joe Biden’s Campaign to Cut Waste initiative, which also includes an executive order from President Obama.

“Execution of the steps outlined in this memorandum is an essential component of the recent executive order, in which the President called for a government that cuts waste and is fully accountable to the American public,” Werfel wrote. “As part of this executive order, the President charged federal CFOs with ramping up efforts to identify, execute, and report on administrative cost savings within the agencies.”

Along with the three initiatives, Werfel wants agency financial managers to rank and implement their employees’ ideas submitted under the 2011 SAVE Awards.

“Within the next two months, OMB will provide each agency with a list of 2011 SAVE Award submissions that relate to programs within your agency,” Werfel said. “This list will maintain the anonymous nature of the SAVE Award process. CFOs should respond to the appropriate OMB Resource Management Office (RMO) by providing a list that ranks these submissions. Submissions should be reviewed and ranked for their ability to reduce costs in a concrete and quantifiable way, as well as the ability to improve the way the government operates by improving quality of output, simplifying processes or increasing the speed of government operations.”

Finally, Werfel asked agencies to establish ways to identify, discuss and promote approaches to eliminate unnecessary costs and inefficient practices.

“These approaches should collectively form a robust clearinghouse of ideas and success stories that you can access and report centrally to the CFO Council,” he said. “In particular, the development of these tactics should draw upon and coordinate with work already being done by agency chief information officers, chief acquisition officers and performance improvement officers to streamline operations and improve performance, as well as existing efforts within the CFO Council on financial management system improvements and performance benchmarking.”

Werfel added the CFO Council, led by the departments of Treasury, Justice, Housing and Urban Development and Health and Human Services, as well as the Environmental Protection Agency and Office of Personnel Management, will establish performance benchmarks to identify efficiencies and areas of costs savings.

“The CFO community, through the CFO Council, should serve as the enabler and coordinator of the government’s common-sense reform initiatives,” he said.

SAVE Award winner presents President with idea