COMPREHENSIVE PLAN OF ORGANIZATION.

With this outline as a basis, the commission has entered upon the preparation of three series of reports. The first series deals with the manner in which the services of the Government should be grouped in departments. This is a matter of fundamental importance. It is only after a satisfactory solution of this problem that many important measures of reform become possible. Only by grouping services according to their character can substantial progress be made in eliminating duplication of work and plant, and proper working relations be established between services engaged in similar activities. Until the head of a department is called upon to deal exclusively with matters falling in but one or a very few distinct fields, effective supervision and control is impossible. As long as the same department embraces services so diverse in character as those of life saving and the management of public finances, standardization of accounting methods and of other business practices is exceedingly difficult of attainment.

So dependent are other reforms upon the proper grouping of services that I have instructed the commission to indicate in its report the changes which should be made in the existing organization and to proceed in the same way as would far-seeing architects or engineers in planning for the improvement and development of a great city. My desire is to secure and to furnish to the Congress a scheme of organization that can be used as a basis of discussion and action for years to come.

In the past services have been created one by one as exigencies have seemed to demand, with little or no reference to any scheme of organization of the Government as a whole. I am convinced that the time has come when the Government should take stock of all its activities and agencies and formulate a comprehensive plan with reference to which future changes may be made. The report of the commission is being prepared with this idea in mind. When completed, it will be transmitted to the Congress. The recommendations will be of such a character that they can be acted upon one by one if they commend themselves to the Congress and as action in regard to any one of them is deemed to be urgent.

REPORTS ON PARTICULAR SERVICES.

The second and third series of reports deal, respectively, with the organization and activities of particular services, and the form of organization for the performance of particular business operations. One of the reports of the second series is upon the Revenue-Cutter Service, which costs the Government over $2,500,000 each year. In the opinion of the commission its varied activities can be performed with equal, or greater, advantage by other services. The commission therefore recommends that it be abolished. It is estimated that by so doing a saving of not less than $1,000,000 a year can be made.

Another report illustrating the second series recommends that the Lighthouse and Life-Saving Services be administered by a single bureau instead of as at present by two bureaus located in different departments. These services have much in common. Geographically, they are similarly located; administratively, they have many of the

same problems. It is estimated that consolidation would result in a saving of not less than $100,000 annually.

In a third report the commission has recommended the abolition of the Returns Office of the Department of the Interior. This action, in its opinion, will cause no loss in service to the public and will result in a direct saving of not less than $25,000 a year, in addition to a large indirect economy in the reduction of work to be performed in the several offices.

In another report the commission has recommended the consolidation of the six auditing offices of the Treasury and the inclusion in the auditing system of the seven naval officers who now audit customs accounts at the principal ports. The changes recommended will improve in many ways the auditing of public accounts and will result in an immediate saving of at least $135,000 annually.

GENERAL TECHNICAL SERVICES.

A third series of reports is being prepared on those branches of the organization which are technical in character and which exis. for the service of the Government as a whole-branches which have to do with such matters as public printing, heating, lighting, the making of repairs, the providing of transportation, and the compilation of statistics where mechanical equipment is essential.

ABOLITION OF LOCAL OFFICES.

Perhaps the part of the organization in which the greatest economy in public expenditure is possible is to be found in the numerous local offices of the Government. In some instances the establishment and the discontinuance of these local offices are matters of administrative discretion. In other instances they are established by permanent law in such a manner that their discontinuance is beyond the power of the President or that of any executive officer. In a number of services these laws were passed nearly a century ago. Changes in economic conditions have taken place which have had the effect of rendering certain offices not only useless but even worse than useless in that their very existence needlessly swells expenditures and complicates the administrative system.

The attention of the Congress has been called repeatedly to these conditions. In some instances the Congress has approved recommendations for the abolition of useless positions. In other cases not only do the recommendations of the Executive that useless positions be abolished remain unheeded, but laws are passed to establish new offices at places where they are not needed.

The responsibility for the maintenance of these conditions must naturally be divided between the Congress and the Executive. But that the Executive has performed his duty when he has called the attention of the Congress to the matter must also be admitted. Realizing my responsibility in the premises, I have directed the commission to prepare a report setting forth the positions in the local services of the Government which may be discontinued with advantage, the saving which would result from such action, and the changes in law which are necessary to carry into effect changes in organization found to be desirable. On the coming in of the report, such offices as

may be found useless and can be abolished will be so treated by Executive order.

PERSONNEL.

In my recent message to the Congress I urged consideration of the necessity of placing in the classified service all of the local officers under the Departments of the Treasury, the Interior, Post Office, and Commerce and Labor.

CLASSIFICATION OF LOCAL OFFICERS.

The importance of the existence of a competent and reasonably permanent civil service was not appreciated until the last quarter of the last century. At that time examinations were instituted as a means of ascertaining whether candidates for appointment possessed the requisite qualifications for Government positions. Since then it has come to be universally admitted that entrance to almost every subordinate position in the public service should be dependent upon the proof in some appropriate way of the ability of the appointee.

As yet, however, little if any attempt has been made by law to secure, either for the higher administrative positions in the service at Washington or for local offices, the qualifications which the incumbents of these positions must have if the business of the Government is to be conducted in the most efficient and economical manner. Furthermore, in the case of many of the local officers the law positively provides that the term of office shall be of four years' duration.

The next step which must be taken is to require of heads of bureaus in the departments at Washington, and of most of the local officers under the departments, qualifications of capacity similar to those now required of certain heads of bureaus and of local officers. The extension of the merit system to these officers and a needed readjustment of salaries will have important effects in securing greater economy and efficiency.

In the first place, the possession by the incumbents of these positions of the requisite qualifications must in itself promote efficiency. In the second place, the removal of local officers from the realm of political patronage in many cases would reduce the pay roll of the field services. At the present time the incumbents of many of these positions leave the actual performance of many of their duties to deputies and assistants. The Government often pays two persons for doing work that could easily be done by one. What is the loss to the Government can not be stated, but that it is very large can not be denied, when it is remembered how numerous are the local officers in the postal, customs, internal revenue, public lands, and other field services of the Government.

In the third place, so long as local officers are within the sphere of political patronage it is difficult to consider the question of the establishment or discontinuance of local offices apart from the effect upon local political situations.

Finally, the view that these various offices are to be filled as a result of political considerations has for its consequence the necessity that the President and Members of Congress devote to matters of patronage time which they should devote to questions of policy and administration.

So

The greatest economy and efficiency, and the benefits which may accrue from the President's devoting his time to the work which is most worth while, may be assured only by treating all the distinctly administrative officers in the departments at Washington and in the field in the same way as inferior officers have been treated. The time has come when all these officers should be placed in the classified service. The time has also come when those provisions of law which give to these officers a fixed term of years should be repealed. long as a fixed term is provided by law the question of reappointment of an officer, no matter how efficiently he may have performed his duties, will inevitably be raised periodically. So long as appointments to these offices must be confirmed by the Senate, and so long as appointments to them must be made every four years, just so long will it be impossible to provide a force of employees with a reasonably permanent tenure who are qualified by reason of education and training to do the best work.

SUPERANNUATION.

Attention has been directed in recent years to the need of a suitable plan of retiring the superannuated employees in the executive civil service. In the belief that it is desirable that any steps toward the establishment of such a plan shall be taken with caution, I instructed the commission to make an inquiry first into the conditions at Washington. This inquiry has been directed to the ascertainment of the extent to which superannuation now exists and to the consideration of the availability of the various plans which either have been proposed for adoption in this country or have actually been adopted in other countries. I shall submit, in the near future, for the consideration of the Congress a plan for the retirement of aged employees in the civil service which will safeguard the interests of the Government and at the same time make reasonable provision for the needs of those who have given the best part of their lives to the service of the State.

EFFICIENCY OF PERSONNEL.

I have caused inquiry to be made into the character of the appointees from the point of view of efficiency and competence which has resulted from present methods of appointment; into the present relation of compensation to the character of work done; into the existing methods of promotion and the keeping of efficiency records in the various departments; and into the conditions of work in Government offices. This inquiry will help to determine to what extent conditions of work are uniform in the different departments and how far uniformity in such conditions will tend to improve the service. I have felt that satisfaction with the conditions in which they worked was a necessary prerequisite to an efficient personnel, and that satisfaction was not to be expected where conditions in one department were less favorable than in another.

This inquiry has not been completed. When it has been ascertained that evils exist which can be remedied through the exercise of the powers now vested in the President, I shall endeavor to remedy those evils. Where that is not the case, I shall present for the consideration of the Congress plans which, I believe, will be followed by great improvement in the service.

BUSINESS METHODS.

In every case where technical processes have been studied it has been demonstrated beyond question that large economies may be effected. The subjects first approached were those which lie close to each administrator, viz, office practices. An illustration of the possibilities within this field may be found in the results of the inquiry into the methods of handling and filing correspondence. Every office in the Government has reported its methods to the commission. These reports brought to light the fact that present methods were quite the reverse of uniform. Some offices follow the practice of briefing all correspondence; some do not. Some have flat files; others fold all papers before filing. Some use press copies; others retain only carbon copies.

UNNECESSARY COST OF HANDLING AND FILING CORRESPONDENCE.

The reports also show not only a very wide range in the methods of doing this comparatively simple part of the Government business, but an extraordinary range in cost. For the handling of incoming mail the averages of cost by departments vary from $5.84 to $81.40 per 1,000. For the handling of outgoing mail the averages by departments vary from $5.94 to $69.89 per 1,000. This does not include the cost of preparation, but is confined merely to the physical side of the work. The variations between individual offices is many times. greater than that shown for averages by departments.

It is at once evident either that it is costing some of the offices too little or that others are being run at an unwarranted expense. Nor are these variations explained by differences in character of work. For example, there are two departments which handle practically the same kind of business and in very large volume. The average cost of handling incoming mail to one was found to be over six times as great as the cost of handling incoming mail to the other.

It has been found that differences of average cost by departments closely follow differences in method and that the greatest cost is found in the department where the method is most involved. Another fact is of interest, viz, that in two departments, which already show low averages, orders have been issued which will lead to a large saving without impairing efficiency. It can not be said what the saving ultimately will be when the attention of officers in all of the departments has been focused on present methods with a view to changing them in such manner as to reduce cost to the lowest point compatible with efficient service. It, however, must be a considerable percentage of nearly $5,000,000, the total estimated cost of handling this part of the Government business at Washington.

Results have already been obtained which are noteworthy. Mention has been made of the orders issued by two departments. Of these the order of one is most revolutionary in character, since it requires flat filing, where before all correspondence was folded; the doing away with letterpress copies: and he discontinuance of indorsements on slips, one of the most expensive processes and one which in the other department has been carried to very great length.