Executive Office of the President

Budget Giveback - Alternate solution

I think the best way to incentivize efficiency is let the agency keep the money by saving it in T-bills or savings bonds. Set an arbitrary limit to like 10% of the annual budget may be saved. Anything beyond that means the agency was over-funded and would need to return the money beyond the 10% delta. Allowing agencies and departments to save up to 10% of their annual budget means in a lean year when unemployment is up and tax revenues are down, then an agency would need to tap into their savings / reserves. In a good year or efficient year they can save their unneeded money (provided it is not to excess). Budgets could be trimmed as usual but when an agency is efficient, they could save the money in savings bonds or t-bills instead of having to fight for dollars year after year.

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Idea No. 8062