GAO: Times call for risk-based budgeting

Federal agencies and congressional appropriators should consider revising their budgets to reflect risk-based spending priorities, the controller general testified at a June 29 hearing.

Demographic trends, rising health care costs, decreasing federal revenues and a growing federal deficit all require the government to do more with less in years to come, Comptroller General David Walker told members of the House Homeland Security Committee’s Management, Integration and Oversight Subcommittee.

Walker defined risk-based budgeting as a “mission-focused, results-oriented, outcome-based budget approach that maximizes value and mitigates risk within current and expected resource levels.”

Congress must appropriate funds where the risk is highest, Walker said, adding that he favors factoring risk into the funding formula for federal homeland security grants to states.

Walker presented the subcommittee with a new Government Accountability Office report that recommends that the Homeland Security Department adopt a more formal and disciplined approach to risk management. It is one in a series of GAO reports citing a need for comprehensive national threat and risk assessments in important sectors, including homeland security.

DHS officials have made progress in applying risk-management practices to some department operations and decisions, the report states. For example, two DHS agencies, the Customs and Border Protection and U.S. Coast Guard, are each acting to mitigate risk and prioritize funding according to risk, the audit report states. The Transportation Security Administration and Immigration and Customs Enforcement have also taken small steps.

DHS’ strategic plan, however, does not provide enough detail on what resources are needed to meet the department’s mission and achieve its goals, GAO auditors found. Nor does the plan address the relationship between annual and long-term goals, they said. The department, however, has not yet finished a comprehensive national threat and risk assessment.

In encouraging federal agencies to move to risk-based budgeting, lawmakers should give organizations flexibility in implementing the process, GAO recommended.

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