Fundamental Changes Needed To Achieve Shared Support Services for Federal Agencies Overseas

Comments were presented on a review of the fundamental changes needed to achieve shared support services for Federal agencies overseas. About 25 separate departments and agencies have personnel assigned to U.S. missions abroad under the jurisdiction of an ambassador. All these organizations have a need for administrative services such as security, personnel management, housing, and motor pool operations. Experience has shown that the sharing of administrative services is the most practical and cost-effective method of providing administrative support. Even though the sharing of administrative support at overseas posts has received wide endorsement, GAO found that it varies from post to post and that many agencies have duplicate capabilities. In 1977, an incremental costing system was implemented under which the State Department absorbs all fixed costs of administrative support and incremental costs are prorated to other agencies on the basis of usage. This system is known as the Foreign Affairs Administrative Support (FAAS) system. The State Department is using the FAAS system during fiscal year 1981 to establish charges for administrative support services provided to other agencies in 122 countries. GAO found several problems with FAAS including: (1) the establishment by the State Department of annual billings for agencies receiving administrative support through a system which estimates and projects the costs of services provided; (2) the way costs are allocated among State Department and supported agencies; (3) serviced agencies were charged for personnel costs that should have been charged to the State Department; (4) agency representatives did not understand the system; and (5) the allocation principles were interpreted and applied differently from post to post. The results of the review did not support charges that the quality of administrative support provided by the State Department is unsatisfactory. Agency representatives were generally satisfied with the quality they received. GAO found that improvements are needed in the training of personnel assigned to administrative duties at overseas posts.