Federal Civil Service Reform Remarks Announcing the Administration's Proposals to the Congress.

President Aukofer and distinguished guests and friends:

This is the third time I've visited here, and I was thinking on the way over about the first two occasions. The last time I was here I was Governor of Georgia, and I came up to make a preliminary announcement of my candidacy for President. I went back to Atlanta that night and made the actual announcement. I think the headline was, "National Press Club Invites Unknown Governor To Speak." [Laughter]

The first time I came I was also Governor of Georgia, and actually the news story was that I was trying to get an appointment with John Ehrlichman's assistant. And I might report I was unsuccessful in doing so. [Laughter]

Today, in order to leave as much time for questions as possible, I'd like to make a brief but a very important statement about one of the most important aspects of government. I came to Washington with a promise and the obligation to rebuild the faith of the American people in our government. We want a government that can be trusted, not feared; that will be efficient, not mired in its own redtape; a government that will respond to the needs of the American people, and not be preoccupied with needs of its own.

Taxpayers who work hard for their money want to see it spent wisely. We all want a government that's worthy of confidence and respect. That is what reorganization is all about.

We have no illusions that this task will be easy. Our Government and its bureaucracy have evolved over many generations, and the work of reform cannot be completed in a single year or a single administration of a President.

But we have begun. We have already adopted zero-based budgeting in all the agencies of Government. We've cut the burden of paperwork on the public and reduced excessive Government regulation, replacing it with free market competition. At OSHA and in other Federal agencies, we are discarding obsolete regulations and rewriting rules in plain and understandable English. We've cut significantly the number of employees in the Executive Office of the President and abolished hundreds of unneeded advisory committees.

But all that is not enough. The single most important step that we can take is a thoroughgoing reform of the civil service system. Civil service reform will be the centerpiece of Government reorganization during my term of office.

I've seen at first hand the frustration among those who work within the bureaucracy. No one is more concerned at the inability of Government to deliver on its promises than the worker who is trying to do a good job.

Most civil service employees perform with spirit and integrity. Nevertheless, there is still a widespread criticism of Federal Government performance. The public suspects that there are too many Government workers, that they are underworked, overpaid, and insulated from the consequences of incompetence.

Such sweeping criticisms are unfair to dedicated Federal workers who are conscientiously trying to do their best. But we have to recognize that the only way to restore public confidence in the vast majority who do work well is to deal effectively and firmly with those who do not.

The two complaints most often heard against the present system are that Federal employees have too little protection against political abuse and too much protection against legitimate assessment of performance and skills. These charges sound contradictory, but both of them happen to be true. And the system that perpetuates them needs to be changed.

For the past 7 months, a task force of more than 100 career civil servants has analyzed the civil service, explored its weaknesses and strengths, and suggested how it can be improved. Their judgments are reflected in the message that I will send to the Congress today. Some of the leading congressional reorganizers are here with me, and I would say in gratitude to them that there's been an unprecedented, close working relationship between the Congress, its staff members, and the White House, the Office of Management and Budget, and others.

Today, I'd like to outline these proposals and explain the reasoning behind them. They represent the most sweeping reform of the civil service system since it was created nearly 100 years ago.

The simple concept of a merit system has grown into a tangled web of complicated rules and regulations. Managers are weakened in their ability to reward the best and most talented people and to fire those few who are unwilling to work.

The sad fact is that it is easier to promote and to transfer incompetent employees than it is to get rid of them. It may take as long as 3 years merely to fire someone for a just cause, and at the same time the protection of legitimate rights is costly and time-consuming for the employee.

You cannot run a farm that way, you cannot run a factory that way, and you cannot run a government that way.

We've lost sight of the original purpose, which was to reward merit. More than 99 percent of all Federal employees get a so-called merit rating. And last year, out of about 2 million employees, only 226 people lost their jobs for incompetence or inefficiency. That's about one one-hundredth of 1 percent.

So, my first proposition is this: Them is not enough merit in the merit system. There is inadequate motivation because we have too few rewards for excellence and too few penalties for unsatisfactory' work.

We must encourage better performance in ways that are used widely and effectively already throughout private industry in our country.

Top Federal employees are ready and willing to respond to the risks and rewards of competitive life, and public service will be healthier when they have that chance.

We must strike a new balance that preserves the merit principle while giving managers the incentive and the authority in hiring and to manage.

We propose to do this first by creating a Senior Executive Service, whose 9,200 members will be available to serve wherever in Government they are most needed. Participation in this effort will be voluntary. They will be eligible for annual bonuses for superior performance and can be moved from the Senior Executive Service back to their previous civil service status for poor performance.

I'll also ask the Congress to authorize the rise of incentive pay for the 72,000 Federal managers and supervisors in grades GS-13 through GS-15, which is a far more attractive and sensible acknowledgement of merit than the silver water carafes and the thicker carpets that pass for recognition today. They will no longer receive automatic step increases in pay without regard for performance.

Another proposal which will improve managerial excellence is a speedier and a fairer disciplinary system which will create a climate in which managers may discharge nonperforming employees, using due process, of course, with reasonable assurance that their judgment, if valid, will prevail. At the same time, employees will receive a more rapid hearing for their own grievances.

The procedures that exist to protect employee rights are absolutely essential. But employee appeals must now go through the Civil Service Commission, which has a built-in conflict of interest by serving simultaneously as rulemaker, prosecutor, judge, and employee advocate.

So, my second proposition is: Employees still have too little protection for their rights. I propose to divide the present Civil Service Commission into two bodies—an Office of Personnel Management to improve the productivity and performance of Federal workers, and a Merit Protection Board to stand watch against merit abuses and to resolve the appeals which are brought by employees.

I will also propose an Office of Special Counsel to investigate merit violations and to protect the so-called whistleblowers who expose gross management errors and abuses.

And finally, I propose the creation of a Federal Labor Relations Authority to remedy unfair labor practices within the Government, much as the National Labor Relations Board does now in private industry. In addition, we will continue to work with Congress and the Federal employees to develop legislation which, while recognizing the special requirements of the Federal Government, will improve Federal labor practices.

One other serious defect remains; that's the network of rules governing hiring, staffing, and tenure. We should give each agency more control over its own hiring rather than the Civil Service Commission, which now takes as long as 6 or 8 months merely to fill important positions.

Current rules which often impede the hiring of qualified women, minorities, and the handicapped, by giving veterans a lifetime advantage under civil service laws, must be changed. (They provide an advantage)¹ far beyond the benefits that are provided under other veterans programs, which are designed legitimately to ease the readjustment from military back to civilian life.

¹ Printed in the transcript.

Therefore, we propose to reduce the preferential advantage given to nondisabled veterans to a 10-year period and to end this preference altogether for senior military officers who retire with pension benefits after a full military career. At the same time, we will strengthen provisions to ensure that disabled veterans and those who served during and since Vietnam are fully protected under the civil service laws.

Let me be straightforward about the implications of all this. Our proposals will mean less job security only for incompetent Federal employees, but conscientious civil servants will benefit from a change that recognizes and rewards good performance.

Our proposals deal with the major changes that must now be made. By enacting them, we will make employment in the civil service more challenging, more profitable, more productive, and a more gratifying career. But the greatest beneficiaries will be the American people, who can expect to see a more competent and efficient and responsive government-one that is worthy of the people it was created to serve.

Thank you very much.