MR. CHAIRMAN AND MEMBERS OF THE COMMITTEE:

I APPRECIATE THIS OPPORTUNITY TO APPEAR BEFORE YOU IN SUPPORT OF THE FISCAL YEAR 1977 BUDGET REQUEST OF THE DEPARTMENT OF STATE.

THE HOUSE APPROPRIATIONS SUBCOMMITTEE RECENTLY RECOMMENDED AN ALLOWANCE FOR 1977 OF $1.042 BILLION OR A REDUCTION OF ABOUT $7 MILLION BELOW THE DEPARTMENT'S BUDGET REQUEST. THE HOUSE APPROPRIATIONS FULL COMMITTEE IS NOT EXPECTED TO REVIEW THE SUBCOMMITTEE'S ACTION UNTIL LATER THIS MONTH. WE HAVE EVALUATED EACH APPROPRIATION REDUCTION BY THE HOUSE SUBCOMMITTEE TO EXAMINE ITS EFFECT ON THE DEPARTMENT'S OPERATIONS AND HAVE DETERMINED NOT TO APPEAL THE HOUSE SUBCOMMITTEE'S RECOMMENDED APPROPRIATION LEVELS, BUT I WOULD LIKE TO COMMENT ON THE HOUSE SUBCOMMITTEE REPORT LANGUAGE BEARING ON THE REDUCTION OF BUDGET AUTHORITY.

BUDGET AMENDMENI

THIS HOUSE ACTION, HOWEVER, DOES NOT INCLUDE A $5.5 MILLION BUDGET AMENDMENT TRANSMITTED TO THE CONGRESS ON APRIL 27. THE HOUSE DEFERRED, WITHOUT PREJUDICE, CONSIDERATION OF THE AMENDMENT BECAUSE OF ITS LATE ARRIVAL. MR. CHAIRMAN, WITH ME ARE MR. LOREN LAWRENCE, ACTING ADMINISTRATOR OF THE BUREAU OF SECURITY AND CONSULAR AFFAIRS, AND MR. SAMUEL LEWIS, ASSISTANT SECRETARY FOR INTERNATIONAL ORGANIZATION AFFAIRS, TO PRESENT TESTIMONY IN SUPPORT OF THE AMENDMENT. THE AMENDMENT WOULD PROVIDE $2 MILLION FOR OUR SALARIES AND EXPENSES APPROPRIATION AND $3.5 MILLION FOR CONTRIBUTIONS TO INTERNATIONAL

ORGANIZATIONS.

UNITED STATES PASSPORT OFFICE

THE SALARIES AND EXPENSES PORTION OF OUR REQUEST IS COMPOSED OF $1 MILLION FOR DEVELOPMENTAL COSTS OF THE Travel DOCUMENT AND ISSUANCE SYSTEM (TDIS) AND $1 MILLION FOR A FILES MINIATURIZATION PROJECT FOR THE UNITED STATES PASSPORT OFFICE. THE TDIS SYSTEM IS DESIGNED TO PROVIDE A MORE EFFICIENT AND CONVENIENT SERVICE TO THE AMERICAN TRAVELLING PUBLIC. THE FILES MINIATURIZATION PROJECT IS TO ESTABLISH A MODERN, EFFICIENT FILES STORAGE AND RETRIEVAL SYSTEM ESSENTIAL FOR EFFECTIVE PASSPORT AND RELATED OPERATIONS.

UNESCO ARREARAGES

ALSO INCLUDED IN THE AMENDMENT IS A REQUEST FOR $3.5 MILLION FOR A CONTRIBUTION TO THE UNITED NATIONS EDUCATIONAL, SCIENTIFIC AND CULTURAL ORGANIZATION (UNESCO). THIS WOULD PARTIALLY OFFSET UNITED STATES ARREARAGES TO UNESCO AND PERMIT US TO REGAIN OUR VOTE AT THE UPCOMING GENERAL CONFERENCE THIS FALL. BY HAVING A VOTING PRESENCE, THE UNITED STATES WILL BE IN A BETTER POSITION TO PRESS FOR NEEDED CHANGES SO THE PRESIDENT CAN MAKE THE REQUISITE CERTIFICATION TO CONGRESS THAT UNESCO HAS CHANGED ITS POLICIES OF A POLITICAL NATURE.

OPPOSITION TO HOUSE PERSONNEL REDUCTION LANGUAGE

MR. CHAIRMAN, WHILE WE ARE NOT APPEALING THE DOLLAR REDUCTION PROPOSED BY THE HOUSE SUBCOMMITTEE IN OUR SALARIES AND EXPENSES APPROPRIATION, I DO WANT TO EXPRESS THE DEPARTMENT'S STRONG OPPOSITION TO THE METHOD OF ACHIEVING THE

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REDUCTION WHICH WE UNDERSTAND WILL BE INCLUDED IN THE HOUSE
APPROPRIATIONS SUBCOMMITTEE REPORT. THE DEPARTMENT WILL BE
FORCED TO OPERATE UNDER A RESTRICTION WHICH WILL ALLOW THE
FILLING OF ONLY ONE OUT OF FIVE AMERICAN VACANCIES ABOVE
THE GS-6 OR EQUIVALENT FOREIGN SERVICE LEVEL RESULTING FROM
VOLUNTARY RETIREMENT OR RESIGNATION ON A WORLD-WIDE BASIS.
THIS LANGUAGE LEAVES THE DEPARTMENT NO MANAGEMENT FLEXIBILITY
TO PROGRAM RESOURCES TO MEET NEW OR CHANGING PRIORITY NEEDS.
THEREFORE, IT WILL HAVE A SERIOUS ADVERSE IMPACT ON THE DEPART-
MENT'S ABILITY TO MEET INCREASING WORKLOADS, SPECIFICALLY IN
THE IMPORTANT AREAS OF TERRORIST PREVENTION, COMMUNICATIONS
AND CONSULAR SERVICES. RECOGNIZING THE IMPORTANCE THIS COM-
MITTEE PLACES ON INTERNAL MANAGEMENT IMPROVEMENTS, THE DEPART-
MENT IN PREPARING ITS FY 1977 BUDGET:

-

REQUESTED NO NEW POSITIONS AND NO DISCRE

TIONARY INCREASES FOR FISCAL YEAR 1977.

INDICATED ITS COMMITMENT TO MEET THE NEED

FOR NEW POSITIONS IN FY 1977 THROUGH

IMPROVED MANAGEMENT OF EXISTING RESOURCES.

THAT:

IN ADDITION MR. CHAIRMAN, I WOULD LIKE TO POINT OUT

--DURING THE PAST DECADE, DESPITE WORKLOAD
INCREASES, THE DEPARTMENT HAS HAD AN OVERALL
NET DECREASE OF 340 POSITIONS IN THE SALARIES
AND EXPENSES APPROPRIATION. THE HOUSE SUB-
COMMITTEE LANGUAGE WOULD REQUIRE AN ESTIMATED
REDUCTION OF 376 POSITIONS AND $2,672,000.

THE PROPOSED LANGUAGE OF THE HOUSE SUBCOM

MITTEE WOULD HAVE A DISRUPTIVE IMPACT ON

OUR PERSONNEL STRUCTURE, AND

BE ADMINISTRATIVELY COSTLY AND DIFFICULT

TO ACCOMPLISH.

ACCORDINGLY, WE ARE RESPECTFULLY REQUESTING THAT YOUR COMMITTEE CONSIDER THE LANGUAGE IN MR. EAGLEBURGER'S LETTER OF MAY 13 WHICH WOULD PERMIT US FLEXIBILITY IN TAKING THE REDUCTION IN OUR PERSONNEL. WE STRONGLY PREFER THIS ALTERNATIVE OVER THE RESTRICTIVE LANGUAGE WHICH WE UNDERSTAND WILL BE CONTAINED IN THE HOUSE APPROPRIATIONS SUBCOMMITTEE REPORT. THE DEPARTMENT'S PROPOSAL ACCEPTS THE APPLICATION OF THE $2 MILLION REDUCTION IN THIS APPROPRIATION TO PERSONNEL SAVINGS BUT REQUESTS THAT WE BE ALLOWED TO MANAGE THE REDUCTION OF OUR PERSONNEL COMPLEMENT IN A PRUDENT MANNER WHICH WILL ALLOW US TO MEET THE CHANGING WORKLOADS AND PRIORITIES.

THERE PRESENTLY EXISTS WITHIN THE DEPARTMENT, MR. CHAIRMAN,
THE MECHANISM FOR ACCOMPLISHING THIS SELECTIVE PERSONNEL

REDUCTION. IT IS THE PRIORITIES POLICY GROUP (PPG),
COMPOSED OF SENIOR DEPARTMENTAL OFFICIALS, ESTABLISHED BY
THE SECRETARY LAST YEAR TO ASSIST IN THE MANAGEMENT OF
RESOURCES AND TO INSURE THEIR ALLOCATION CONSISTENT WITH
POLICY OBJECTIVES.

WE

MR. CHAIRMAN, THAT CONCLUDES MY PREPARED STATEMENT. WILL BE PLEASED TO ANSWER ANY QUESTIONS YOU OR THE COMMITTEE

MAY HAVE.

STATEMENT SUMMARIZED

Mr. THOMAS. If I may, sir, I would just like to summarize my

statement.

Senator PASTORE. All right.

Mr. THOMAS. There are three points, Mr. Chairman, I would like to make. As you said, we have reviewed each appropriation reduction and its impact, and have determined that we will not appeal those reductions.

We are bringing to you a budget amendment which you mentioned in the amount of $5.5 million, which was deferred by the House without prejudice.

It contains $1 million for developmental costs of the travel document issuance system for the Passport Office; $1 million for miniaturization of the passport files; and $3.5 million for the United Nations Educational, Scientific, and Cultural Organization.

I have with me in support of that amendment, Mr. Loren Lawrence, the Acting Administrator of the Bureau of Security and Consular Affairs; Miss Frances Knight, Director of the Passport Office; and Mr. Sam Lewis, Assistant Secretary for International Organization Affairs.

Senator PASTORE. Now address yourself to the restrictive language.

OPPOSITION TO HOUSE PERSONNEL REDUCTION LANGUAGE

Mr. THOMAS. All right, Mr. Chairman. The Department, as you know, sir, has agreed to accept the $2 million reduction. Our problem is strictly with the language which is, in our judgment, very restrictive. It would leave us no management flexibility to allocate our resources from lower priority activities to new or changing higher priority activities.

Senator PASTORE. In other words, what you are actually telling me is that, with the reduction of the $2 million, if you had more liberal language, you would still bring about the recommendation of the House to fill one out of every five vacancies, but you would want the choice of where you do it?

Mr. THOMAS. No, Mr. Chairman. Although we are perfectly willing to take a $2 million reduction in our personnel level, we would prefer more flexibility to reduce our total complement by the number of positions that amount to $2 million.

Senator PASTORE. And what would that come to?

Mr. THOMAS. Sir, it probably would be somewhere in the neighborhood of 150 to 200 positions based on our estimates to date. Senator PASTORE. 150 to 200 positions?

Mr. THOMAS. Yes, sir.

Senator PASTORE. And what effect would the House action have? Mr. THOMAS. The House action would effect a reduction of 376, Mr. Chairman.

Senator PASTORE. In other words, you feel that that restriction goes a bit too far?

Mr. THOMAS. Absolutely, Mr. Chairman, without question, particularly when you consider the increased workload we have in terrorism and the protection of our diplomats; and our consular and passport workload.