From cuts to costs: Why federal paperwork keeps piling up

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The Office of Management and Budget's (OMB) release of the 2023 Information Collection Budget (ICB) paints a troubling picture of not just of growing federal paperwork burdens, but of the current administration's attitude toward them.

The annual report, a requirement under the 1980 Paperwork Reduction Act (PRA), revealed 10.5 billion hours of paperwork in fiscal year 2023-up from 10.34 billion in 2022. Recent months-not yet compiled into a fresh ICB-herald higher levels of paperwork burden.

Historically, the PRA aimed to minimize the paperwork burdens and red tape on small businesses, nonprofits, and individuals. Yet, the latest ICB focuses less on reducing compliance hours and more on easing and encouraging access to government benefits.

Illustrating that, for the second year in a row the report has substituted its traditional "working paper" format for a glossy publication titled Tackling the Time Tax: Making Important Government Benefits and Programs Easier to Access.

Rather than streamlining government operations, the report highlights efforts to simplify eligibility for federal programs like small business loans, disability payments, food assistance, and partnerships with community organizations. While this benefits recipients of federal largesse, it downplays the burdens faced by the productive sectors of the economy.

I provide a cross-agency breakdown of paperwork hours at Forbes. The Department of the Treasury leads (as is typical) with 6.657 billion paperwork hours driven largely by tax compliance. The Department of Health and Human Services follows with 1.59 billion hours.

Cumulatively, the 10.5 billion hours in annual paperwork hours represent the equivalent of nearly 15,000 human lifetimes spent on paperwork in a single year.

The dollar costs are high, too. OMB estimates $187 billion in annual costs as of this month, imputing roughly a $15 hourly rate. Reassessing with more realistic wage rates, such as $40 per hour for compliance professionals, brings the cost closer to $420 billion. Remember that's paperwork alone; not actual regulatory compliance costs such as those in environmental and labor mandates.

These developments and the policy stance that has ushered them in reflect the Biden administration's broader ambitious whole-of-government interventions. The OMB's rewrite of its guidance to agencies on performing regulatory review has transformed cost-benefit analysis into a tool advancing agency objectives rather than reduction of red tape and questioning the premises of regulatory intervention.

As calls for regulatory reform grow, particularly under Trump's proposed Department of Government Efficiency external advisory group, it's vital to reaffirm the PRA's original intent: curbing bureaucracy and protection the nation's productive sectors, not expanding dependency.

For more see: "Dead Tape: Annual Federal Paperwork Hours Consume Equivalent Of 14,983 Human Lifetimes," Forbes.