Sunday, August 06, 2006

 

Deconstructing the Paperwork Burden

Every year the "Paperwork Reduction Act" requires that the Office of Management and Budget provide Congress with an estimate of how much time Americans spend filling out government forms. The goal is to "minimize the burden that responding to these collections imposes on the public, while maximizing their public benefit." The 2005 estimate was 8.4 billion hours, so for the 230 million people over age 16 (I assume that kids don’t fill out a lot of government forms) that's an average of 36 hours per person. IRS tax forms account for 80% of this estimate, 30 hours a year.

Even if we factor out homeless people, transients, people in prisons and others who probably don't fill out a lot of government forms, maybe this number goes up some but it doesn't seem like such a big time burden on average. And since I know I spend a lot more time than that dealing with income tax recordkeeping and reporting, most people must be getting off relatively easy.

Nevertheless, a recent review of the OMB's report conducted by the US Government Accountability Office got some news coverage when it came out, and a lot of it wasn't very kind. There were lots of headlines like "Drowning in Paper" or "Buried under paperwork."

I didn't think that this kind of bashing was justified, so I read the complete GAO report, presented to Congress by Linda Koontz, and I was very impressed by it. Most government agencies seem to be taking the PRA very seriously. In particular, the PRA as amended in 1995 presents a checklist against which information collection should be evaluated (included as Table 1 of the GAO report) and OMB provides
careful guidance
on the why, when, how of data collection in forms, surveys, and questionnaires.

Most people would identify two kinds of causes for the paperwork burden:

1) Government action. Most of the burden correlates with the extent of data collection mandated by law or regulation, and this is what most critics focus on.

2) Design of the forms or other data collection instruments. The burden is increased by forms that are poorly designed, either from a physical or presentational standpoint (confusing layout, tiny fonts, not enough space) or from a more conceptual or architectural standpoint (ambiguous language, choices or enumerations that don't span the entire range or that are incompatible).

But recent thinking about estimating the paperwork burden is surprisingly sophisticated. Rather than analyzing the burden form-by-form, the IRS is developing a methodology that considers characteristics of taxpayers and the context in which they complete their tax returns. These include the way in which they gather and manage relevant information, any software they use, and whether they work with others (like accountants or tax preparation service). This more complex methodology will make information standards, interoperability, and other document engineering considerations more prominent in the analysis to yield more accurate estimates of the compliance burden and suggest better ways to reduce it. The IRS is also making
significant investments in XML and online filing.


And consider one more thing. At least the government is trying to minimize the burden that collecting information imposes on its "customers" and is very transparent in making the case for what it does. The private sector has no such goals, and consciously misrepresents or obscures its efforts to wring every last bit of information from consumers. For example, when you buy something, did you know that your warranty rights are not in the least bit undermined if you don't fill out product registration cards and the detailed surveys that usually are part of them?

-Bob Glushko





Comments:
I think it is probable that the government could do quite a bit to reduce the administrative burdens it imposes on small businesses through the way they design their data collection methods.

When dealing with the government, whether in the context of things like regulatory compliance or of things like bidding on contracts, there are certain core pieces of information one is asked for that are the same across all data collecting agencies.

I wonder if it would make sense to have a single clearing house sort of set up where the small business owner could submit whatever information they needed to submit at a single point of entry, rather than having to send three or five or ten different agencies six or ten or twenty different forms?
 
I totally match with everything you've written.
 
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