MEMORANDUM TO THE HEADS OF DEPARTMENTS AND AGENCIES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80B01676R000400190009-1
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 2
• Document Creation Date: December 14, 2016
• Document Release Date: January 16, 2003
• Sequence Number: 9
• Publication Date: March 3, 1966
• Content Type: MEMO

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MEMORANDUM TO THE HEADS OF DEPARTMENTS AND AGENCIES
March 3, 1966
Each of you is aware of my determination that this Administration achieve
maximum effectiveness in the conduct of day-to-day operations of the
Government.
We must seek in every feasible way to reduce the cost of carrying out
governmental programs. But we must remember ghat our budgetary costs--
our current out-of-pocket expenditures--do not. always provide a true
measure of the cost of Government activities. This is often true when
the Government undertakes to provide for itself a product or a service
which is obtainable from commercial sources.
t the same time, it is desirable, or even necessary, in some instances
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or the Government to produce directly certain products or services for
its own use. This action may be dictated by program requirements, or by
wack of an acceptable commercial source, or because significant dollar
savings may result.
Decisions which involve the question of whether the Government provides
directly products or services for its own use must be exercised under
uniform guidelines and principles. This is necessary in order--
to conduct the affairs of the Government on an orderly basis;
to limit budgetary costs; and
to maintain the Government's policy of reliance upon private
enterprise.
At my direction the Director of the Bureau of the Budget is issuing
detailed guidelines to determine when the Government should provide
products and services for its own use. These guidelines are the result of
long study, based on experience over the past six years since the current
guidelines were issued.
Each of you is requested to designate an assistant secretary or other
o;;icial of comparable rank to--
review new proposals for the agency to provide its own supplies
or services before they are included in the agency's budget;
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review experience under the new guidelines; and
suggest any significant changes to the guidelines which experience
may indicate to be desirable.
I do not wish to impose rigid or burdensome reporting requirements on each
agency with respect to the new guidelines. However these guidelines will
require that appropriate records be maintained relative to agency commer-
cial or industrial activities. I am also requesting the Budget Director
to report to me from time to time on how the new directives are being
carried out, and whether experience suggests changes in the guidelines oz
in agency reporting requirements.
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