FY-1966 BUDGET DEVELOPMENTS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP68R00530A000100100019-6
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 4
• Document Creation Date: December 15, 2016
• Document Release Date: January 23, 2003
• Sequence Number: 19
• Publication Date: January 23, 1965
• Content Type: MEMO

SECkL.I 17YZLC
Approved For Release 2011310412? 1:3F-ZIARRBROBROU530A000100100019-6
OFFICE OF THE DIRECTOR
Licputy Director (Plans)
Deputy Director (Intelligence)
TO iDeputy Director (Science and Technology)
treWtk-
Inspector General
General Counsel
SUBJECT : FY 1966 Budget Dev
pments
1 DD/ST;ii:
_
A-436
Action Memorandum No
Date 2 3 JAN 1965
REFERENCE:
I. The Fiscal Year 1966 budget proposal of the Agency has been
reviewed by the Bureau of the Budget and, after adjustments, the President
has now approved the Agency's request for presentation to the Congress.
In addition to the usual limitations on total dollar level for new obli ational
authority and on total number of positions, the Bureau has this year
applied two new restrictions:
a. A "maximum allowable" number of positions G5-14
through GS-14 and a specific limitation on the overall total
of supergrade and scientific pay schedule employees authorized.
b. A set level, which cannot be exceeded, for the average
ary paid on an Agency-wide baste.
Z. Both of these new limitations have been established for all agencies
of e Goverxuent. The first one, restricting the number of grades 14
through 18 and setting the coiling on supergrades, has been given wide
publicity in the press, is easily understood, and poses no great problem
for CLA. The second new control factor, the average salary stipulation,
s more complex and requires both elaboration and action... the purpose
f this memorandum.
3. Obviously, the change in ground rules reflects the Presideetial
rzaination to stop escalation In the size and in the dollar costs of
nment agencies. These measures have been taken against a backdrop
SUSPENSE DATE:
SECRET
1 --------GflOIW 'I
Excluded from
downErnding nuf.I
declassification
Approved For Release 2003/04/23APST/PREIP68R00530A000100100019-6
0
4t:Z>Pzio4t=i4
, r
Approved For Release 2003/0472J'ftWkbP68R00530A000100100019-6
of two recent pay raises for Federal employees and the abundantly clear
policies of this Administration with respect to increased productivity and
economy in Government operations. Each agency is charged with keeping
within the limits established and with taking steps now to assure that
controls are developed to meet these objectives.
4. The Bureau of the Budget contends that, even after allowances
have been made for pay raises and the usual periodic step increases, the
Agency average salary over the past year has shown a sharp rise. The
Bureau feels that our promotion rate may be unduly high, that there has
been too great a margin between position grade and the actual grade of the
incumbent, and that grade structure within organizational components may
be richer than actual responsibilities justify. The Bureau has also suggested
that Agency retirement rates, under both the new legislation and existing
Civil Service arrangements, should start to accelerate, with a concomitant
lowering of average salary needs.
5. Based on the foregoing considerations the Bureau of the Budget
has assigned an Agency average salary for FY 1966 which is exceedingly
austere. A careful examination of Agency experience in this area is being
made in preparation for further negotiations with the Bureau, but even if
some relief is obtained from the assigned figure, the problem of adhering
to a set average salary is a substantial task for Agency management.
b. There are mitigating factors, believed to be unique to CIA, which
have contributed to the trend toward higher average salaries. First is
the legitimate and anticipated result of the Agency's deliberate policy of
recruiting below the grade of the position and then promoting to the grade.
In other words, people brought aboard in the lower grades are now growing
into their full responsibilities and this is being recognized by promotion.
This policy of E0Ding substantially below grade differs from the practice
elsewhere in Government. Second, the Agency skills mix has also changed
materially over the past year with many lower grade personnel dropped
from Tables of Organization and their numbers reduced through attrition
(one of the manifestations of an organization coming down in over-all
personnel strength). Finally, new positions at higher grade levels have
been created to accommodate an increasing requirement in the scientific
and technical fields.
Approved For Release 2003/04/23 : CIA-RDP68R00530A000100100019-6
Approved For Release 2003/04/23 : CIA-RDP68R00530A000100100019-6
7. The Bureau has taken note of these factors and recognisee that they
play a role in the upward trend of average salary. Accordingly, when FY 1966
funds are apportioned next July, the issue can be opened again. In the interim,
the Agency's Congressional budget request complies with the assigned level
and will be defended on that basis.
8. Admittedly, "average salary" in itself can be a very fluid control
device, responding to the mix of personnel at any given time and susceptible
to artificial rigging. Despite these possible shortcomings, Agency manage-
ment must propose to meet this new requirement. This task involves the
full scope of personnel management from job creation and position grading
through recruitment, pay, promotion and separation.
9. The Office of Budget, Program Analysis and Manpower and the Office
of Personnel are currently developing proposals which will assure appropriate
monetary and personnel controls while maintaining the integrity of the Agency
Career Service concept. The results of these efforts will be discussed at a
forthcoming meeting of the Financial Policy and Budget Committee.
10. Three steps are immediately obvious. First, as a temporary measure,
there will be no upgrading of positions until an appropriate monetary and grade
control system has been approved. Second, promotion actions must be held to
those which you feel are absolutely essential. Third, all Directorates must
institute an aggressive program to initiate retirement of those personnel who
qualify under the law at this time. This is vital to provide essential headroom
and flexibility for personnel management throughout the Agency. The Office
of Personnel will provide each Directorate with the names of personnel under
their jurisdiction who qualify for retirement over the next 18 months. Each
Directorate will report to me by March 1, 1965 the actions taken to effect
retirement of these personnel.
Lyriaa.:
Lyman B. Kirkpatrick
Executive Director-Comptroller
Approved For Release 2003/04/23L; plA7RDP68R00530A000100100019-6
OLIA?jET
25X1
Approved For Release 2003/04/23 : CIA-RDP68R00530A000100100019-6
Next 1 Page(s) In Document Exempt
Approved For Release 2003/04/23 : CIA-RDP68R00530A000100100019-6