SUMMARY REPORT OF 1964 COMPTROLLER ACTIVITIES

• Document Type: FOIA
• Collection: FOIA Collection
• Document Number (FOIA) /ESDN (CREST): 06768783
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 12
• Document Creation Date: March 8, 2023
• Document Release Date: April 24, 2019
• Case Number: F-2014-02320
• Publication Date: February 8, 1965

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SUMMARY REPORT
OF
1964 COMPTROLLER ACTIyITIES
1. During 1964 the Executive Director-Comptroller met the Director's
call for forceful management of resources by increased direction and
overview of Agency programs, funds and manpower. Critical attention
was placed on program execution and financial management at all levels of
the Agency through the newly created Office of Budget, Program Analysis
and Manpower and its independent program analysis and review within the
budgetary process. New regulations were introduced and existing
regulations modified to incorporate reporting systems designed to increase
and sharpen program assessment. Project proposals, organizational
shifts and manpower adjustments were brought under close review to
weigh the resource cost against the net intelligence gain likely to result
from implementation. Where dollar and manpower factors were involved,
such reviews included Agency-sponsored projects prepared for the 303
Committee and USIB consideration. Special attention was given to
improving coordination between directorates in the planning and execution
of their programs.
2. The year 1964 also saw an increase in "capital investment" in
improving the financial management of the Agency. Important advances
in the financial oversight of proprietary programs had their genesis during
this period. A Financial Analysis Numbering (FAN) system using automatic
data processing was introduced into Agency accounting and is currently
being programmed to improve review of use of funds and long-term planning.
A Manpower Analysis Numbering (MAN) system designed to provide
information on the use made of our people is presently in the testing phase.
For the first time in the history of the Agency, a program is underway to
inventory and control the number of contract and non-staff personnel,
location, compensation and responsibilities.
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3. Probably the most significant advances in 1964 were the concerted
economy programs which saved millions of Agency dollars and the
reversal in the buildup of Agency manpower levels. This progress has
been accomplished without reducing the capability of any directorate to
perform its mission. The manpower reductions were accomplished after
careful study of total Agency activity and were of sufficient magnitude,
over a two-year period, to allow some flexibility in undertaking new
programs, such as an expanded Junior Officer Training effort, and to
allow R&D programs to be built up at the expense of lesser priority
activity of other directorates.
4. The "barons war" has abated somewhat as "Spanish customs"
uncovered. However, the historic philosophy of separate services,
administered, except in the broadest terms,apart from the remainder of
the Agency, continues to be upheld in some quarters. While there are
arguments that do support "uniqueness" for selected programs, even these
have tended to crumble under the cold review of dollars and manpower
management. However, an extremely delicate balance must be maintained
in this area if we are to nurture the individual initiative and ingenuity which
are so necessary to the development of intelligence techniques and
operations and, at the same time, provide a system for assessing the res-ults
of programs and achieving a proper balance in the allocation of manpower
and financial resources among the wide range of programs of the Agency.
Opposition to the movement toward centralized overview of programs and
resource use has been met by steady pressure applied through the allocation
of funds, the approval of personnel levels, independent program evaluation,
Inspector General surveys, audits, and the regulation of administrative
services rendered to the directorates and divisions. Where poor and
impractical management practices have prevailed over the years, these
have been cited and brought forcefully to the attention of the directorates
for corrective action.
5. In this context, a multiple approach to the review of management
problems has been taken.
a. Regular visits have been initiated by the Executive Director-
Comptroller to all operating divisions. During these visits, briefings
on key management and operating problems are provided by the
supervisory personnel of the divisions. The program is having a
most satisfactory impact.
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b. Selected activites have been identified for special attention.
Communications concerning these activities have been reviewed
for a period of time and records of achievement and purpose examined
functionally. A close liaison between BPAM program analysts and
the Inspector General has evolved. Issues have been brought to the
Inspector General's attention by BPAM for use in IG inspections.
Follow-up Of IG recommendations is being made through more extensive
use of budget hearings, and consideration in the allocation of funds
takes into account the response of the directorates to such matters.
c. "Inventories of Ignorance" are being undertaken as management
tools. These inventories are affording the base of information needed
to get a total look and to identify weak spots in our management that
can be corrected. The following are a few examples of these
inventories.
(1) The Agency has never had a total inventory of its research
and development activity. With the centralization of responsibility
for program budgeting, BPAM has been able to develop an R&D
catalog which provides the base for relating purpose to dollars
invested. Machine processes are being explored for keeping this
information current.
(2) An inventory of Agency aircraft has also been taken and
an aircraft catalog assembled. This catalog shows the complex
inter-relationship of proprietaries, their cost and intelligence use.
The catalog is in great demand in the Agency as a reference source.
(3) As indicated, BPAM is developing ways of recording all
Agency contract personnel and relating their use to program cost.
In this manner, it will be possible to measure true manpower
resource investment against results.
(4) An inventory of Agency space owned or leased has been
made by the Office of Logistics and is providing BPAM analysts
a further cross cut to the investment in this important support cost.
6. Considerable attention has been given to developing our relationships
with the Congressional Appropriations Committees and their staffs. A
careful review and monitoring of legislative matters bearing on contracting
practices, manpower utilization in the government, personnel practices,
retirement policies, supply and logistic practices, to name a few, have been
made by BPAM and weighed in their application to Agency program and
manpower planning. Liaison with the Bureau of the Budget has been close
and, we believe, fruitful. In all of this liaison, caution has been exercised
to restrict discussions to those matters wherein the Bureau of the Budget �,
or Committee staffs have a clear need-to-know; all such liaison is recorded.
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7. During 1964 continued attention was given to CIA communication
support to the National Communication System. Demands for Agency
support from this quarter have not abated. Our record of performance
within the NCS has been excellent. There has been recognition by the
Bureau of the Budget of Agency need for dollar and personnel adjustments
upward to support the communications workload in Europe and Africa.
More support for Africa will have to be established in upcoming months.
8. Looking to the future, the program for 1965 calls for more of
the same plus a penetrating look at Agency organization and planning
mechanisms. The value of applying operations research techniques
to Agency planning is being investigated. The establishment in BPAM
of an Agency Program Control Room of information will facilitate
examination of the totality of the Agency effort. This control room will
take on more sophisticated form in 1965. The training of a few carefully
selected junior officers located with BPAM is underway. These officers
will play an important role in vigorously pursuing the application of
operations research to costing and planning problems of the Agency. We
hope to standardize the base of information used in the preparation and
review of budgets through increased application of machine processes.
Improvement in the communication and timely reporting of obligation data
from the field will permit more effective utilization of funds for
reprogramming. Further steps will be taken to relate manpower use
to productivity levels in selected operations.
9. In 1965 it appears timely to take a hard look at the manner in
which all directorates are organized to meet today's requirements and
to improve the utilization of manpower and substantive responsiveness.
a. Overt collection undertaken by the Agency should be appraised
as to its effectiveness and location in the command structure.
b. The organization, oversight and control of large covert action
proprietaries need continued attention and more penetrating budgetary
review by BPAM. Hopefully the current task force will place further
light on these needs. Consideration might be given to the creation
of a Radio Division outside of the CA Staff to include Radio Free
Europe, Radio Liberty, and possibly FBIS.
c. An organizational shift separating the evaluators of Agency
covert action programs from those directly responsible for operating
covert action projects should receive consideration.
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77-77. 7-77
d. The role of SOD/DDP in support of paramilitary programs
is currently being examined by the Inspector General. In this
regard, from a dollar and productivity viewpoint, the centralization
of responsibility for covert air assets of the Agency should be
considered and the barriers to over-all management of this
annual cost item overcome.
e. The Agency's hot war responsibilities need to be realistically
reappraised and the war planning investment made by the Agency
should be examined in terms of likely conditions in a future type
war.
(b)(1)
(t(b)(1)
(b)(3)
f. There continues to be an ever-increasing problem of information
management. Aggressive attention to the CHIVE system must coati:me.
Additional studies need to be made in improving the selectivity of
that information processed.
g. The growth and orientation of R&D activities of DD/S&T will
need continued overview in CIA. Coordination of R&D within a
community context is also on the horizon.
h. The Agency's personnel structure must be under constant
scrutiny. We must strengthen management of our qualification
standards. Classification and organization reviews can be qualitatively
improved and supported.
i. The trends closely point to increasing coordination of Agency
activity with other intelligence programs through such vehicles as
the CCP, CIP, IAP, etc. The role of the Executive Director-
Comptroller and the Agency's budget people in these reviews should
be strengthened. Reappraisal of the Agency's training and medical
programs and their relationship to substantive requirements is in
order.
j. The development of an orderly and imaginative retirement
system and a supporting out placement service will need continued
attention. Managed attrition must be organized and forceful.
10. In summary, the Executive Director-Comptroller, during 1965,
will concentrate on program and planning systems for the Agency and on
the organization maintained in the various directorates in terms of their
productivity and responsiveness. Controls will be tightened over
manpower and salary administration. Use of funding authority will be
reviewed. The 1965 emphasis is consistent with the charter the President
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has assigned to the Director to take personal charge in improving the
management and effective utilization of personnel and dollar resources.
The facing up to organizational changes, the alterations of old methods
of doing business, and the application of new and imaginative approaches
require hard and objective review and command. The decisions will not
be easy. They will require a cooperative attitude on the part of all
directorates working together toward improved productivity. The
solicitation of this cooperation and the confrontation of the issues involved
are the responsibilities of the Executive Director-Comptroller in support
of the DDCI and DCI.
12. In these and several other approaches not listed, it is essential
that the Director continue to support the requirement for a careful overview
and independent and informed assessment of Agency programs by the
Executive Director-Comptroller. Only if this is the case will it be
possible to assure that the management of Agency activities by and within
directorates is sound and evaluation as to its effectiveness unbiased.
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SECRET
ANNUAL REPORT
of the
Office of Budget, Program Analysis and Manpower
1. In 1964 the Office of Budget, Program Analysis and Manpower
moved forward toward full maturity as a central instrument serving
the needs of top management. Although the organization was created
during the previous calendar year, it did not really begin to function
as an integrated totality until well into 1964. During the year the
Office grew in its base of experience, gradually engaging a staff
with sufficiently broad capabilities to carry the responsibilities
imposed in The staffing problem was particularly serious
at the time of formation of the Program Analysis Staff. By the end
of the year, however, the positions were filled with mature, senior
people embracing a wide range of experience adequate to cope with
the problems ahead.
2. To a significant degree BEAN should be regarded in its
relationship to the Office of the Director as analogous to the
Bureau of the Budget in its relationship to the President. Its role
is to provide staff support essential to the coordination of inter-
related activities and to assure that problems are viewed from an
Agency-wide rather than a single component perspective. Thus, BPAM
assists in providing a balanced judgment on program and management
problems and on the most efficient and effective utilization of
dollar and manpower resources available in the Agency.
3. The technical budgetary role of the Office is not new, of
course, since this function is as old as the Agency itself. Looked
at in the broader sense, however -- namely that type of budgeting
which depends on thorough program knowledge -- we find a growing
awareness of the need to integrate closely program judgments with
the dollar and manpower availabilities within the Agency. As a
consequence, the BEAM staff both in the review of the operating
budget for Fiscal Year 1965 and the submission of the Fiscal Year
1966 budget to the Bureau of the Budget placed greater stress on
substantive matter than had heretofore occurred. This does not
mean that previous budgets lacked sound program justification but
rather that the perspective which comes from an objective, non-
vested-interest review which emphasizes program content, had not
always been present. Nor had full attention been devoted to program
inter-relationships among components.
SECRET
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SEGfc t.
4. The Manpower Control Staff, although small, had an extremely
demanding year because of the continuing pressures occasioned by
White House personnel policies. Vigorous efforts were applied to
effectuate controls on hiring in order to pare down the total number
of employees as well as maintain a check over the average grade of
employees.
5. Finally, the Program Analysis Staff devoted much time and
thought to ad hoc reviews of projects from the DD/P and the DD/S&T
requiring the Executive Director's attention. Because the Staff
was not complete during much of the year, it was not possible to
plan its program in a systematic way; rather it was fully occupied
in reacting to problems which came up through the Directorates to
the Executive Director-Comptroller. Now that staffing has been
completed, however, it is expected that the Staff will be able in
the future to plan a prograr of activities which will include the
initiation of studies of problem areas before issues come to a
head. This may result in a continuing series of joint survey team
efforts such as the one currently scrutinizing the Big Three
proprietaries. The knowledge born of such teamwork can be of great
benefit in facilitating sound decisions at top Agency levels when
issues arise.
6. While the above describes the general forms and philosophy
of BMWs efforts during the past year, the broad myriad of activities
incidental to the successful implementation of the Agency's budget
continued in the normal way. These included such matters as issuing
calls for preliminary FY 1966 estimates and transmitting them to the
Bureau of the Budget, following much the same procedure for the final
FY 1966 estimates, preparing materials for the FY 1965 Congressional
budget submission, conducting extensive hearings on the FY 1965
financial plan, issuing allocations and allotments to all components,
obtaining apportionments from the Bureau of the Budget, preparing
monthly reports on obligations, making monthly status-of-fund reports
to the Bureau of the Budget, assuring that property procurement is
conducted in a balanced way, and so on ad infinitum. These things
happened and will continue to happen; they merit no more attention
because they constitute the raison d'etre of the Office.
7. Of greater interest, perhaps, are those areas in which
innovations were made to improve in a systematic way the discharge
of BEAM's responsibilities. In the technical budgetary area the
foremost innovation was the successful institution of the Financial
Analysis Number System (FAN). Its purpose was to lay the groundwork
for more varied and more penetrating analyses of all inputs in the
Agency's activities, as well as to place budgeting and accounting
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on the same basis. With the system installed and working, we are
now in the position to devise analytical reports on project dollars,
manpower and many other aspects of activity. Also in the somewhat
technical field, most of the work was completed toward achieving a
new Object classification code in accordance with Bureau of the
Budget guidelines. This will provide additional data for budget
justification and also delineate more clearly between various
expenditure categories. Yet another accomplishment in the technical
area is the creation of a new funding and accounting system for
external training. Under this system all funds for external training
are now being budgeted for by the individual offices but administered
by the Office of Training through a special account. Each office
will receive a monthly report indicating its costs for external
training.
8. Toward the end of the year the groundwork was laid for
instituting an R&D catalog system which will go into effect in
January 1965. The purpose is to provide information internally to
the Office of the Director and elsewhere which will facilitate
responses to queries about Agency R&D efforts as well as permit
easier coordination of programs, thereby eliminating unnecessary
duplication which might otherwise occur. Further, in the area of
R&D we worked closely with the Office of Logistics to accelerate
contractual action in order to prevent traditional year-end log
jams on contract negotiations. The results of this effort will be
cumulative since many of the contracts are subject to annual
renewal and we expect to continue to press for earlier contracting
in the current year.
9. A review was made of all budgetary material currently at
the Records Center, and a records retirement schedule was estab-
lished and regularized. The responsibility of actually retiring
unneeded materials still needs to be discharged and remains a chore,
time permitting, for 1965. In the way of establishing better
records and presentation materials, BEAM has now completed the
construction of a work/control room which will enable group applica-
tion to budget and manpower methods and a pictorial presentation of
data related to existing programs. This should be of considerable
assistance in evaluating and applying budgetary formulation and
execution policies and in viewing total inter-relationships.
10. BPAM has initiated a systematic review of all DD/P
memoranda to the 303 Committee to determine budget and manpower
implications. This activity relates closely to the project review
responsibility which the Office has undertaken under which there
have been numerous ad hoc studies made of large and small projects
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currently in being or being initiated. Analyses have also been made
of many R&D projects requiring concurrence at the Office of the
Director level as well as of ongoing activities such as the Joint
Operations Intelligence Center of the Special Operations Division.
Moreover, the proprietaries of the Covert Action Staff have been
given a great amount of attention because of constant budgetary
escalations arising either from program expansion or additional
personnel benefits consequent upon salary increases, new retirement
systems and the like. The latter have taken large amounts of time
and promise to continue in the same vein as efforts are extended
to impose a greater measure of control over proprietary operations.
Throughout the year the Office made a substantial contribution to
the work of ExComAir, and the Program Analysis Staff has under very
active study the whole range of Agency air activities.
11. Perhaps the most extensive innovations have occurred in
the area of manpower control. Here we find that the continuing
pressures from the White House for personnel restraints have led
to a series of policy decisions requiring control techniques new to
the Agency. For the first time an effective system of controlling
position ceilings was imposed at the budgetary component level.
Further, a more restrictive policy concerning approval of waivers
to Agency retirement was enunciated and efforts have begun in the
Agency to establish retraining opportunities for employees with
unneeded skills as well as to strengthen the outplacement service.
In the manpower informational reporting area, a project was con-
ducted to permit the review of the allocation of manpower authoriza-
tions by Agency activity and function as well as by organization.
Upon its implementation it will be possible to consider the
distribution of manpower in relation to the priority missions of
the Agency. Furthermore, in the area of non-permanent personnel it
became apparent that Agency data were inadequate and a project is
well on the road to establish a system which will provide complete
information on this large group of people.
12. Another timeconsuming area of activity has been in
responding to the Bureau of the Budget requests for more detailed
information related to Agency resource utilization. This has in-
cluded the provision of a quarterly economy report as well as an
extensive one-time report describing the Agency's system for con-
trolling average grade, and numerous other items of information
such as the number of people overseas, the number of people filling
positions at grade GS-14 and above, etc. Reporting to the Bureau
of the Budget has also included what was once a quarterly but is
now a semi-annual report on the balance of payments impact on Agency
operations.
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13. In all of the above there has been a notably high
level of cooperation among the various segments of BRIM. This
was particularly apparent during the hearings and deliberations
attendant upon approval of the operating FY 1965 budget. Inputs
were made by the Manpower Control Staff, the Program Analysis
Staff and, of course, the Budget Division which, taken together,
permitted coordinated recommendations to be made regarding
operating levels. It is expected that this teamwork concept
will continue and in fact grow as the impact of the Officers
efforts becomes apparent and the assistance which we can
provide to the Office of the Director makes its mark.
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