On the Road Again

t's the same old story: The government predicts decreases in travel spending, and then spends more on travel than it did the previous year. In fiscal 1998, federal travel spending was 7.4 percent above what agencies had planned. That's $549 million in unforeseen expenditures. But there are signs that travel budget planners may be getting more realistic: This year the Office of Management and Budget predicts travel spending will increase 2.1 percent from fiscal 1999 to 2000. Only one other time since fiscal 1992 (when Government Executive began tracking the numbers) has OMB predicted an increase (a whopping 1 percent from 1994 to 1995). But spending actually has increased every year except two. So take all predictions with a grain (or more) of salt.

Missed Targets

The Defense Department is the driving force in government travel spending. It accounts for roughly two-thirds of all such spending. In fact, the 1998 budget projection would have been right on target had DoD not exceeded spending targets by $545 million.

Several other agencies also missed their targets by quite a bit last year. Some of these included Agriculture (21.4 percent over budget), State (23.8 percent), and Social Security (23.3 percent). In most cases, agencies say, unforeseen increases in travel spending resulted from programmatic changes. At Social Security, for example, major changes in disability programs increased the need for travel and training.

Other agencies, however, spent substantially less than they had anticipated. The departments of Justice, Transportation and Veterans Affairs, for example, came in millions of dollars under projected travel spending. The Federal Emergency Management Agency, the Federal Deposit Insurance Corp. and the Department of Housing and Urban Development actually came in 15 percent or more under budget. HUD, which spent 29 percent less than it anticipated, attributes the savings to its HUD 2020 management reform initiative, which took employees away from regular duties, including those that require travel, for part of the year, while the department took a close look at its functions and practices.

DoD and a few other agencies account for the vast majority of travel spending. The 22 biggest travelers paid out almost 99 percent of the $8 billion the federal government spent on travel in fiscal 1998. Commerce Department spending has been up markedly (more than 62 percent for the past three years), putting it in the top 10 for the past two years. Energy has fallen out of those elite ranks, though it expects a 27 percent increase in spending next year.

It all adds up to big bucks. Business travel pumps an estimated $175 billion a year into the U.S. economy, according to the National Business Travel Association, and federal travel spending makes up almost 5 percent of that, making the government one of the nation's biggest travel spenders.

Looking Ahead

For fiscal 2000, most agencies are anticipating slight adjustments up or down in overall travel spending, but a few are expecting changes in the double digits. FEMA, for example, requested a travel budget down almost 66 percent for 2000, but says cuts may go even deeper than that. Commerce, on the other hand, is planning for an increase of almost 70 percent because of the 2000 census.

Travel reengineering efforts, such as the new Defense Travel System, should start yielding serious savings in the not-too-distant future. Those numbers won't show up in travel budgets, because they will mostly be in the administrative end of travel. But travel experts hope that one effect of better travel management will be to ensure that the government is getting the best deals possible from vendors, so direct travel spending could fall slightly or agencies could travel more and still stay within budget.

"We're hoping that governmentwide [travel] programs will save lots of money in the future," says Arnie Linares, travel management coordinator at the Transportation Department's headquarters. DOT has broken new ground with the first federal fee-based travel management contract (under which customers pay travel agencies for the services they provide). "With changes like our online booking project, pushing automation and preferred pricing programs, the next couple of years are going to be big."

Government travel experts are looking to the General Services Administration for more and better data on how travel dollars are spent to help set policy over the next few years. They're also considering developing performance measures for travel, like those used in the private sector, to ensure that travel dollars are spent wisely.