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Statement of 
STEVEN A. McNAMARA
ACTING INSPECTOR GENERALU.S. DEPARTMENT OF EDUCATIONBefore theSUBCOMMITTEE ON LABOR,HEALTH AND HUMAN SERVICESAND EDUCATIONCommittee on AppropriationsUnited States House of RepresentativesRegardingPROPOSED FISCAL YEAR 1999BUDGET REQUESTMARCH 31, 1998
 
Mr. Chairman and Members of the Committee:Thank you for the opportunity to discuss our Fiscal Year 1999 budget request to support salariesand expenses of the Department of Education's Office of Inspector General. I would like to submit mystatement for the record and present a short summary of it for the Committee.
PURPOSE OF OPERATIONS
The Office of Inspector General (OIG) was created under the Inspector General Act of 1978, asamended, to prevent and detect fraud, waste and abuse and improve the economy, efficiency andeffectiveness of Education Department (ED) programs and operations. These responsibilities are carriedout by staff in headquarters and in regional offices and under contracts administered by OIG staff.
FY 1999 BUDGET REQUEST
The Department's FY 1999 budget request for OIG is $31.2 million, a net increase of $1 millionabove the 1998 budget authority, and 285 full-time equivalent positions. The staffing level is the same asour 1998 level.Approximately $.5 million of the increase will support salary costs, including annualization of the1998 pay raise, the proposed Government-wide 1999 pay raise of 3.1 percent, and employee benefits. TheGovernment's share of employee benefits costs is increasing as employees covered under the Civil ServiceRetirement Act leave and are replaced by employees covered under the Federal Employees RetirementSystem.The remaining $.5 million will help defray non-personnel costs including OIG’s share of theDepartment’s overhead services such as payroll processing, ADP processing, and other contractualservices; and will provide small increases for advisory and assistance contracts, leasing and maintainingequipment due to replacement of older equipment, travel, printing, supplies, goods and services from othergovernment agencies such as the Federal Law Enforcement Training Center and the General ServicesAdministration, and other contractual services.
 
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As our staff has decreased to its present level, OIG has continued to meet the challenge to remaineffective by finding more innovative ways to deploy our resources and conduct our audit, investigation andmanagement review efforts. For example, we have shifted our emphasis and approach to focus our effortson program and operations issues and systemic problems that are larger in scope than the traditional single-entity focus. This front-end work will lead to more effective programs with built-in controls and self-enforcing mechanisms to prevent fraud, waste and abuse by all participants, rather than relying on“after-the-fact” detection at those few participants we have the opportunity to review.
STRATEGIC PLAN AND RECENT ACCOMPLISHMENTS
OIG’s strategic plan states that its mission is to “promote the efficient and effective use of taxpayerdollars in support of American education by providing independent and objective assistance to the Congressand the Secretary in assuring continuous improvement in program delivery, effectiveness and integrity.”OIG’s strategic goals to achieve its mission, and some examples of accomplishments for each are:
GOAL:
The Department, Congress and other interested parties use
 
OIG products and services
to
improve the efficiency, effectiveness, and integrity of education programs and operations.
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We devoted significant resources to provide input for the 1998 reauthorization of the
HigherEducation Act
(HEA). To assist Congress in its task of reauthorizing HEA, the OIGsubmitted a package of HEA amendment proposals to Congress, based on OIG audits andinvestigations, that we designed to greatly improve the integrity of SFA programs and savehundreds of millions of dollars. We shared our proposals with Departmental officials and metwith various staffers on the educational committees to discuss our proposals in detail, and webelieve our proposals had an impact on both the Department’s proposals and the HEA billrecently reported out by the House Committee on Education and the Workforce.
!
As part of our
Direct Student Loan
oversight efforts, we issued our nationally representativedirect loan school audit report that summarized the results of 16 audits, including
of 00

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