Special Message to the Congress Transmitting Reorganization Plans 1 Through 13 of 1950.

To the Congress of the United States:

I am transmitting today Reorganization Plans Nos. 1 to 13 of 1950, designed to strengthen the management of six executive departments and seven regulatory commissions. These plans propose a major clarification of the lines of responsibility and authority for the management of the Executive Branch. They would put into effect the principal remaining recommendations of the Commission on Organization of the Executive Branch of the Government affecting the location of management responsibility within the departments and agencies.

A principal finding of the Commission on Organization was that clean-cut lines of authority do not exist in the Executive Branch. The Commission stated that "the first and essential step in the search for efficiency and economy in the Executive Branch of the Federal Government" is to correct the present diffusion of authority and confusion of responsibility. The Commission warned that without this action "all other steps to improve organization and management are doomed to failure. "Reorganization Plans Nos. 1 to 13 propose a bold approach to the problem of delineating responsibility and authority for the management of the Executive Branch. Clearer lines of responsibility and authority will strengthen our constitutional system and will also help to establish accountability for performance in office--a basic premise of democratic government. I urge the Congress to add its approval to my acceptance of these recommendations of the Commission on Organization. Reorganization Plans Nos. 1 to 6, Relating to Six Executive Departments.

Reorganization Plans Nos. 1 to 6, inclusive, relate to the Departments of the Treasury, Justice, the Interior, Agriculture, Commerce, and Labor. With certain exceptions, these plans transfer to the respective department heads the functions of other officers and agencies of the departments. They permit each department head to authorize the functions vested in him to be performed by any officer, agency, or employee of the department. In addition, Administrative Assistant Secretaries are provided for each of the six departments, and additional Assistant Secretaries are authorized for the Department of the Interior and the Department of Agriculture.

In its introduction to its first report, the Commission on Organization stated two "essentials of effective organization." These fire:

"The President, and under him his chief lieutenants, the department heads, must be held responsible and accountable to the people and the Congress for the conduct of the executive branch," and

"The wise exercise of authority is impossible without the aids which staff institutions can provide to assemble facts and recommendations upon which judgment may be made and to supervise and report upon the execution of decisions."

The Commission specifically recommended:

"Under the President, the heads of departments must hold full responsibility for the conduct of their departments," and

"Department heads must have adequate staff assistance if they are to achieve efficiency and economy in departmental operations." These six reorganization plans put into effect these recommendations.

Through the years the Congress has repeatedly endorsed the policy of holding agency heads fully accountable for all the functions of their agencies. Last year this policy was pursued in the legislation authorizing reorganization of the Department of State and establishing the General Services Administration. A reorganization plan applying this principle to the Post Office Department was likewise approved.

However, in the six departments covered by these plans, all functions are not now uniformly vested in the department heads. Some statutory authority is held independently by subordinate officers and agencies. These plans extend fully to the six departments the principles of strengthening departmental management by eliminating the patchwork exceptions that now exist.

The transfers recommended in these plans accomplish three principal objectives. First, they provide a clearer line of responsibility and authority from the President through the department heads down to the lowest level of operations in each department. Second, department heads are made responsible in fact for activities within their agencies for which they are now, in any case, held accountable by the President, the Congress, and the people. Third, department heads are enabled to effect appropriate internal adjustments as may be necessary within their departments to permit the most effective organization of departmental resources and bring about continuous improvement in operations.

These reorganization plans exclude from transfer to the department heads two classes of functions which are retained in their present status. These are the functions of the hearing examiners appointed under the Administrative Procedure Act and the functions of government corporations in the departments.

The provision in each of these plans for an Administrative Assistant Secretary is also based on a recommendation of the Commission on Organization. These positions were recommended in order that each department head, in addition to being made fully responsible for his department, be given adequate staff facilities to assist him in the managerial side of his responsibilities. The accomplishment of specific improvements in management can be made only through continuous attention to the effective performance of such aids to management as budgeting, accounting, personnel, and management analysis.

For the government as a whole steps are being taken in accord with the Commission's recommendations to improve the usefulness of these aids to management--steps toward a performance budget, improved accounting methods, better personnel administration, and government-wide management improvement. The results of these actions have been promising, but they demonstrate also that this work needs increased departmental attention. While the responsibilities of the Administrative Assistant Secretaries are not fixed by these plans, it is intended that these officials will work primarily on aiding the department heads to achieve better management.

As recommended by the Commission on Organization, these reorganization plans provide for appointment of the Administrative Assistant Secretaries from the classified civil service and fix a salary at the top of that service. These plans also provide for appointment by the department heads with the approval of the President. Such a method of appointment will tend to establish a career pattern for these positions extending across departmental lines. Presidential approval will emphasize that the Administrative Assistant Secretaries should assume a government-wide approach to management problems. This arrangement is consonant with the authority placed in the President by the Classification Act of 1949 to designate positions in the top grade authorized under that Act.

Two of the reorganization plans provide additional Assistant Secretaries, to be appointed by the President and confirmed by the Senate, one in the Department of the Interior and two in the Department of Agriculture. This step is in accord with recommendations of the Commission on Organization. The additional Assistant Secretaries are needed to provide more adequate staff assistance in supervising and directing the policies and programs of these large departments. At present the Department of the Interior has two such officials and there is one such position in the Department of Agriculture.

Under the provisions of Reorganization Plan No. 2 the title of the Assistant to the Attorney General is changed to Deputy Attorney General, and an additional Assistant Attorney General is provided in lieu of the Assistant Solicitor General, the latter office being abolished. These changes . are designed to reflect more accurately the position and responsibility of these two officials of the Department of Justice. Reorganization Plans Nos. 7 to 13, Relating to Seven Regulatory Boards and Commissions.

Reorganization Plans Nos. 7 to 13, inclusive, relate to the Interstate Commerce Commission, the Federal Trade Commission, the Federal Power Commission, the Securities and Exchange Commission, the Federal Communications Commission, the National Labor Relations Board, and the Civil Aeronautics Board. These plans are designed to strengthen the internal administration of these bodies by making the Chairman, rather than the commission or board as a whole, responsible for day-to-day administration. Also, the function of designating the Chairman of these bodies is vested in the President in those instances where this function is not already a Presidential one.

These plans carry into effect the first and most important recommendation of the Commission on Organization relating to regulatory commissions. The Commission recommended "that all administrative responsibility be vested in the Chairman of the Commission." Its reasons were summarized as follows:

"Purely executive duties--those that can be performed far better by a single administrative official--have been imposed upon these commissions with the result that these duties have sometimes been performed badly. The necessity for performing them has interfered with the performance of the strictly regulatory functions of the commissions." Elsewhere the Commission observed:

"Administration by a plural executive is universally regarded as inefficient. This has proved to be true in connection with these commissions."

Since the creation of the Interstate Commerce Commission in 1887, the board or commission has been an established form of Federal organization for regulatory activities. The plural membership of each of these agencies has been based, presumably, on the usefulness of deliberation in the rulemaking and adjudicative processes. However, as their work has developed through the years, each of these agencies has become, in addition to a deliberative body, an organization of staff elements whose work must be programmed and whose members must be recruited, supervised, and led. The smallest of these staffs is now over 600 in number and the largest over 2,000, and the difficulties of supervision are multiplied because of the highly technical nature of the legal, engineering, accounting, and other skills which must be successfully interrelated.

The commissions, concerned primarily with the substantive problems of regulation and with the adjudication of cases, cannot give adequate attention to the day-to-day executive direction of complex organizations. To the extent that they have concerned themselves with administrative problems, the unwieldiness of the structure has sometimes rendered administration slow, cumbersome, and indecisive.

Accordingly, within the limitations explained in later paragraphs, each of these plans vests in the Chairman, in each case, responsibility for appointment and supervision of personnel employed under the commission, for distribution of business among such personnel and among administrative units of the commission, and for the use and expenditure of funds.

In the conduct of all of these activities, the Chairman will be bound by the general policies established by the commission and by its regulatory decisions, findings, and determinations. In addition, the right is specifically reserved to the commission to revise budget estimates and determine the distribution of funds among the major programs and purposes of the agency. The appointment of the heads of major administrative units under the commission is subject to approval of the commission, and each Commissioner retains responsibility for actions affecting personnel employed regularly and full time in his immediate office.

The proposals contained in these reorganizations are not new. Several of the commissions have already made considerable progress in placing administrative responsibility in their Chairman. Therefore, the effect of these plans is to extend uniformly to all commissions a pattern of organization demonstrated by experience to be successful.

The fact that under these reorganization plans the commissions retain all substantive responsibilities deserves special emphasis. The plans only eliminate multi-headed supervision of internal administrative functioning. The commissions retain policy control over administrative activities since these are subject to the general policies and regulatory decisions, findings, and determinations of the commissions.

The plans do not contemplate that the Chairman will be relieved of any of his duties as a member and presiding officer of the commission. They simply place on him the additional responsibilities for the operations of the staff. The Chairman will need to establish the necessary administrative arrangements to carry out these responsibilities.

Reorganization Plan No. 12 terminates the present division and confusion of responsibility in the National Labor Relations Board by abolishing the office of the General Counsel of the Board. The Senate last year indicated its approval of this step. The reorganization plan in effect restores unified authority and responsibility in the Board. As in the case of the other plans for regulatory agencies, certain administrative and executive responsibilities are placed in the Chairman. The relationship between the Board and the Chairman is identical with that provided for the other regulatory agencies. This action eliminates a basic defect in the present organization of the National Labor Relations Board and provides an organizational pattern consistent with that established for the other regulatory agencies.

In the plans relative to four commissions-the Interstate Commerce Commission, the Federal Trade Commission, the Federal Power Commission, and the Securities and Exchange Commission--the function of designating the Chairman is transferred to the President. The President by law now designates the Chairmen of the other three regulatory commissions covered by these plans. The designation of all Chairmen by the President follows out the general concept of the Commission on Organization for providing clearer lines of management responsibility in the Executive Branch. The plans are aimed at achieving more fully these management objectives and are not intended to affect the independent exercise of the commissions' regulatory functions.

All thirteen of these reorganization plans will aid in making a more efficient government. The plans affecting the departments will help straighten out the lines of responsibility and authority, improve administrative accountability, and make departmental management sufficiently flexible to meet changing problems. The plans relating to the regulatory commissions will result in the more businesslike and effective administration of the Government's regulatory programs. In short, these plans provide for better management of the executive departments and regulatory commissions and thus will assure to the public the best possible service at the lowest possible costs.

HARRY S. TRUMAN