Administrative PAYGO (E.O. 13893)

Summary

Makes government agencies find ways to save money if their new actions would cost more, helping to control federal spending.

What problem does this solve?

Government agencies were not consistently following rules to balance their budgets, which sometimes led to more government spending. This order makes the budget-balancing rule official and stronger, forcing agencies to cut costs elsewhere if they want to spend more on new actions.

What does this order do?

Mandatory spending offsets

Requires any agency action that increases mandatory spending to be paired with another action that cuts mandatory spending by a similar amount.

OMB review and approval

Requires agency heads to submit any proposed discretionary action to the Director of the Office of Management and Budget (OMB) for review and approval.

Waiver authority for OMB director

Allows the OMB Director to waive the budget-neutrality requirement if it is necessary for essential services, effective program delivery, or is in the public interest.

New guidance to be issued

Directs the OMB Director to issue new instructions for implementing the order and to revoke a previous 2005 memorandum on the same topic within 90 days.

Who does this affect?

Federal government agencies

What is the real world impact?

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Promotes fiscal responsibility

Aims to control federal spending by requiring agencies to operate on a budget-neutral basis for new actions, preventing increases in the national deficit from administrative decisions.

When does this start?

This order takes effect immediately and sets deadlines for new guidance to be created.

New OMB guidance

Within 90 days of October 10, 2019, the OMB Director must issue new instructions on how to implement this order and must cancel the old OMB Memorandum M-05-13.