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GCN Home > 02/10/03 issue

OMB to agencies: Justify that IT spending

By Jason Miller, GCN Staff

As the White House detailed each agency’s share of the $59.3 billion earmarked for IT in the president’s fiscal 2004 budget request, one thing became clear: The administration will increase its pressure on agencies to justify their IT investments.

Senior Office of Management and Budget officials used the proposal, which President Bush sent to Congress last week, to make it known that scrutiny of the business cases agencies submit would continue to increase in coming budget cycles. What’s more, OMB will not let agencies spend funds requested for next year if it decides that agencies failed to provide the necessary information when asked for revised justifications.

“Much of the $60 billion is misspent, and much of it is spent in an uncoordinated way,” OMB director Mitchell E. Daniels Jr. said. “We have used the authority Congress gave us to stop a variety of programs until they prove they, first of all, have a sound business case and will return greater productivity in their investments, and secondly, they will enhance integration and coordinate inside the federal government and not make bad problems worse.”

Agencies should expect OMB to tighten the screws on oversight during the next 12 months, with a continued emphasis on improving cybersecurity, seeking business cases that are more closely aligned with federal enterprise architecture plans and specifying metrics to gauge performance.

Of the administration’s IT request, $37 billion would be for mission projects and $21 billion for office automation and infrastructure initiatives. The overall request represents more than a 14 percent increase over the original $52.6 billion request for this year.

Most agencies saw modest increases in their IT budgets. But the increases were generally less than 1 percent, and some agencies should expect decreases. Mark Forman, OMB’s associate director for e-government and IT, attributes about $1.6 billion of the overall increase to improved business case reporting.

Down to details

“We are much further along as an enterprise in the sophisticated IT management practices,” Forman said. “The more qualitative and quantitative we made the business case process, the more we focused on getting agencies to lay out explicitly why they are making the IT investment and what will be the results.”

Officials assessed more than 1,400 IT business cases representing $35 billion. They labeled 771 representing about $20.9 billion as at-risk for not meeting at least two of three criteria: adequate security, sufficient project management or detail about how an IT project meshes with an agency’s mission. Forman said about 280 business cases worth about $8 billion were done correctly. The other 349 cases were so poor that OMB asked agencies to resubmit them by March 1, he said.



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