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You may continue, Mr. MacLeod.

Mr. MACLEOD. The Federal Standard Stock Catalog was designed and has covered those items which were considered to be stocks commonly used and desired for cataloging by the agencies themselves. "There were included in that catalog, and are still included in it, about 360,000 items of supply. Just prior to and during World War II, the number of items used by the various agencies of the Government grew by leaps and bounds, and it was impossible under the system of the Federal Standard Stock Catalog to keep up with them. The result was that there were developed some 17 different systems of identification, description and numbering of items which were used by the supplying departments and establishments.

That resulted in tremendous confusion and great duplication, sometimes costly, because of the lack of identification of the items in stock. As a result, also, there developed an extremely difficult problem when it came time to declare those items that were surplus to the War Assets Administration, because they could not identify them.

The result of that was a very active study initiated by the President and assigned to the Director of the Budget in 1945, to develop plans to correlate and unify the existing cataloging systems, and to develop a uniform classification by which the commodities used by the departments and agencies would be grouped together in related catalogs. So that, for example, you would have the same materials, such as machine screws and bolts and other items, in the same line in a catalog.

Then in 1946, a report was prepared by the United States Standard Commodity Catalog Board, established by the Director of the Budget, setting out a plan for a Federal cataloging system which could be uniformly used by all of the departments.

Mr. HOLIFIELD. You are speaking now of the “common use” items of both the civilian and military departments, or are you confining your remarks strictly to the items that were standardized for the benefit of the civil agencies of the Government?

Mr. MACLEOD. I am speaking to the over-all system which would identify not only common items of use, but military items of supply, and so forth, across the board.

Mr. HOLIFIELD. I understand that there are items that are outside of the common-use category, but is there any liaison between your agency on this attempt to standardize with the military because they are great consumers of common-use items?

Mr. MACLEOD. Yes, if I may come to that in just a moment. The present arrangements are going forward on the basis of direct liaison, so that we do have correlation between those two.

It is now estimated that there are about 3,000,000 individual items of supply being used by all of the departments, a tremendous increase over the normal use prior to World War II. It is further considered that in order to arrive at uniformity and eliminate duplication and overlapping and confused identities, we might review something like 12,000,000 items in order to get the screening process done and reduce them to the net 3,000,000 that we estimate are available. As you have indicated, Mr. Chairman, some 15 to 20 percent are individual items of military combat, which are highly specialized and which are primarily the concern of the military.

There is an important point that must be recognized here, which is, that while some of these items are especially designed for military combat use, they are very substantially used by civil establishments. For example, the common Colt .45 caliber revolver is an essential military item. But the same item is used by our Coast Guard custodial people, and others, so that it becomes of great concern also to the civil establishments.

In 1947, for the fiscal year 1948, the Bureau asked for an appropriation to proceed with this project. Congress at that time considered it desirable to continue our planning work, and as a result of that determination the Bureau has continued to collaborate with the military in an attempt to develop a uniform system.

Mr. HOLIFIELD. Do you find a spirit of full cooperation on the part of the military in this work?

Mr. MacLEOD. Yes. At the present time we consider that our cooperative arrangements are very excellent and working well.

Mr. HOLIFIELD. They realize that this is not only an attempt to establish economy, but in actual defense terms it is a very important matter for our national defense to have these articles standardized for economical production and wide allocation of contracts during wartimes as well as peacetimes!

Mr. MACLEOD. Yes, sir.

As a matter of fact, when we made our first presentation to the Deficiency Subcommittees of the Appropriations Committees of the Congress, the military were in full support of that presentation. As a result of the denial of the appropriation, it was absolutely essential that they proceed immediately with the project because of the military urgency of identifying their items of supply and unifying their system of supply.

In consequence, they did go ahead, and as I have indicated, with the full agreement and approval of the Bureau of the Budget, the Bureau of Federal Supply entered into an agreement with the Munitions Board in which, in the interim of our getting on with the civilian phase of the actual cataloging, we would coordinate our work with the Munitions Board cataloging agency on a full membership basis. At the present time the Bureau of Federal Supply has full membership on the executive group of the cataloging agency of the military in the Munitions Board and are participating fully in the policy and procedural developments of the cataloging system.

The plan and purpose is to assure that the work done by the military shall, insofar as possible, be suitable for use by civilian establishments so that it will be unnecessary for us to duplicate or revise the military system in major particulars later on.

We have asked for an appropriation in this Congress to carry on that coordinating work and, if and when this legislation is enacted, we will carry forward our collaboration with the military on a more active basis.

Mr. HOLIFIELD. How many people did your establishment assign to this work of standardization ?

Mr. MacLEOD. The direct assignment of staff to the Munitions Board cataloging-agency work at the moment involves three people, including my personal attention.

Mr. HOLIFIELD. That is too few, if I may be allowed to say so, forsuch an important function.

Mr. MACLEOD. We are spread out so thin, Mr. Chairman, that it is very difficult for us to keep up with the attendance at the meetings, much less to keep abreast of the documents and developments.

Mr. HOLIFIELD. In my opinion it is a penny-wise-and-pound-foolish policy, because I believe in this field of standardization there is more opportunity for savings than almost in any other field.

Mr. MACLEOD. Yes, sir. The savings will run into very large figures.

They cannot be predicted easily in fixed terms and direct amounts, but experience has shown industrially

and otherwise that these programs result in tremendous savings. The difficulty is that they have to be put into effect before you can achieve the savings, but the result is unquestionable and is well substantiated by the studies that have been made by our topside people in the Government.

Mr. HOLIFIELD. The reason I am so very much interested in this. is because this fact was brought home to me because of 2 years' work that I did on the Rizley subcommittee on the War Assets Administration problem of disposal and the tremendous confusion that existed there as a result of differences in nomenclature alone was astounding. Then when you multiply that by the different items which were slightly different, but used for the same purpose, or which could have been used for the same purpose, the confusion became multiplied through waste and ineficiency.

Mr. MACLEOD. We have one instance, Mr. Chairman, where one particular antifriction bearing commonly manufactured by all of the antifriction bearing manufacturers, New Departure, SKF, and Fafnir, all made the same bearing, and that was identified with 207 different identifying numbers for that single bearing.

Of course, what that means is that you might have bearings in your stock and not know that they were interchangeable, whereas, in fact, they are identical.

Now, the further difficulty with that illustration is that when the manufacturer of a piece of equipment buys that bearing he puts an additional identification number of his own on it, so that the permutation of that identification becomes so confused that it is utterly impossible for the man at the supply level to ever identify that item in relation to all of the equipment with which it can be used.

Mr. HOLIFIELD. In times of war the lack of knowledge on the part of your purchasing agencies as to where those items are obtainable results in confusion or lack of contracts, and a denial of contracts to many different industries in areas of our country that could be of service.

Mr. MACLEOD. Yes, sir.

We made a recent survey of the question of property management which was conducted jointly and cooperatively by the Bureau of the Budget with the Treasury Department and the General Accounting Office.

One of its first important recorr mendations, fundamental to the process of accountability and identity of property, was the development of a uniform system of identification and classification.

In other words, it is virtually impossible to put into effect any suitable system of exchange or accountability or utilization of property

without knowing precisely what you are talking about, whether this desk is interchangeable with another, or whether this table is usable with another, and what kind of a table it is in fact.

Mr. HOLIFIELD. I think we are going to have to rush along.

My own enthusiasm for this subject has led us into it a little deeper than we should go at this time, and I apologize to the committee for the extension of my remarks at this point.

Mr. KURTH. Mr. Chairman, I would just like to mention one other matter that this bill does, and that is that it creates a system of adequate freight traffic management. The same story may apply throughout, as you undoubtedly know. If the Federal Government had proper freight traffic management, it could save millions of dollars. and again this is a matter of being penny-wise and pound-foolish.

By investing some money in personnel for that purpose, as authorized by this bill, millions of dollars can be saved.

Mr. HOLIFIELD. That is, in the routing of freight on more economical routes ?

Mr. KURTH. Yes, sir; that is correct.

Mr. HOLIFIELD. Rather than following the precedent of shipping on lines without knowledge of other economical alternatives?

Mr. KURTH. Yes, sir; that is right; better distribution and better methods of transporting freight for the Federal Government over the most economical routes, and so forth.

That information would be made centrally available through the establishment of a central traffic service in this agency.

Mr. HOLIFIELD. Mr. Kurth, I wish you would furnish this committee for its files a résumé of what you think would be the primary result of savings involved in this change.

Mr. KURTH. All right, sir; I shall be glad to do that, Mr. Chairman.

Mr. HOLIFIELD. Or your ideas as to how savings could be made by expanding, if necessary, the function in certain departments of your agency.

I think the whole purpose of these reorganization acts is for economy and efficiency, and I would like to have additional information available to the committee members on this subject.

Mr. KURTH. Yes, sir.

In conclusion, I would just like to say that I think Mr. Elliott has ably presented the main provisions of the bill, and we have nothing to add to his presentation.

Mr. HOLIFIELD. Thank you, Mr. Kurth.
Are there any further questions at this time?

I believe I will skip at this time the Comptroller General's office for a few minutes, and ask Mr. Niederlehner of the National Military Establishment to come forward, please. I assume the Military Establishment has a representative here.

Mr. NIEDERLEHNER. Yes, sir.

STATEMENT OF LEONARD NIEDERLEHNER, COUNSEL FOR THE

MUNITIONS BOARD

Mr. HOLIFIELD. All right, Mr. Niederlehner, you may proceed now.

Mr. NIEDERLEHNER. Mr. Chairman, we would like to present a forinal statement at some time convenient to the committee.

Mr. Carpenter, Chairman of the Munitions Board, would be the spokesman for the Military Establishment.

Mr. HOLIFIELD. Excuse me, I did not get the point of your statement.

Mr. NEIDERLEHNER. We would like to present a formal statement through Mr. Carpenter, Chairman of the Munitions Board, at some time that would be convenient to the committee.

Mr. HOLIFIELD. Is he here now?
Mr. NIEDERLEHNER. He is not here; no, sir.
Mr. HOLIFIELD. He is not here?
Mr. NIEDERLEHNER. No, sir.

Mr. HOLIFIELD. Do you care to make a preliminary statement at this time, a statement preliminary to Mr. Carpenter's statement?

Mr. NIEDERLEHNER. I would prefer to leave the matter to him if that is convenient to the committee.

Mr. HOLIFIELD. Are you at liberty to tell this committee as to whether you approve or disapprove of the terms of this act ?

Mr. NIEDERLEHNER. Well, I would say that we are in general accord with the provisions of the act, specifically the disposal program. In view of the fact that we are forward looking, we think it would be a good idea to have the disposal of property centralized.

We are in the position on the procurement matters of not objecting too strenuously.

We would like, in that connection, to elaborate on the provision that has been put into the bill and the reason for it. Our concern, of course, is logistic support of actual military operations, and we would like to explain the intent of the present provision and have that appear in the record, and, if possible, have it appear also in the committee report.

Mr. HOLIFIELD. Does Mr. Carpenter want to include that in his formal written presentation, or do you want to make an oral presentation of that point?

Mr. NIEDERLEHNER. We can do either or both, at the pleasure of the committee.

Mr. HOLIFIELD. I think that he should appear before the committee and furnish us with his written report prior to appearing before the committee to give our counsel and our committee members a chance to look it over. Then he should appear for questioning.

Mr. NIEDERLEHNER. We would be very happy to do that, Mr. ChairMr. HOLIFIELD. When will your report be ready?

Mr. NIEDERLEHNER. We can have it available sometime next week. It is now in the process of preparation. In view of the fact that we have not studied the bill since its introduction last year, we may have some technical comments. I noticed some technical changes as we have been going through it that, perhaps, should be made.

Mr. HOLIFIELD. Yes.

Mr. NIEDERLEHNER. And if Tuesday or Wednesday of next week would be convenient for the committee we could be ready at that time.

Mr. HOLIFIELD. I suggest that you confer with our legal counsel, Mr. Kennedy, on the matters that you bring up and prepare for us your report just as quickly as possible. We want to continue these hearings as expeditiously as possible.

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