UNITED STATES GOVERNMENT
CONFIDENTIAL POLICY REVIEW
OFFICE OF ADMINISTRATIVE MANAGEMENT
WASHINGTON, D.C.
December 1966
THE SPECIAL GOVERNMENT EMPLOYEE PROGRAM:
ORIGIN, DEVELOPMENT, AND ADMINISTRATIVE EXPERIENCE
Executive Summary
This report reviews the establishment and operation of the Special Government Employee (SGE) category within the Executive Branch during the period 1962–1966. The designation was created to permit the Federal Government to obtain temporary or intermittent services from individuals possessing specialized knowledge while maintaining appropriate standards of public accountability and conflict-of-interest regulation.
The experience of the first four years indicates that the SGE mechanism has become an important instrument for securing scientific, technical, medical, legal, economic, and managerial expertise not otherwise available within the permanent civil service. At the same time, its use has raised questions concerning public confidence, standards of disclosure, and the proper relationship between government decision-making and private professional interests.
The report concludes that the SGE program has substantially strengthened the Government’s advisory and analytical capabilities but requires continued oversight and refinement.
I. Historical Background
A. Postwar Expansion of Government Expertise
The period following the Second World War witnessed a marked increase in the complexity of Federal responsibilities. National defense, atomic energy, aerospace development, public health, transportation, communications, and economic management increasingly required highly specialized technical knowledge.
By the late 1950s, senior officials throughout the Executive Branch reported growing difficulty in obtaining the services of leading experts on a permanent basis. Many of the nation’s most qualified scientists, physicians, engineers, attorneys, and industrial researchers preferred to remain affiliated with universities, laboratories, hospitals, and private enterprises.
Federal agencies nevertheless required their advice for limited periods. Existing personnel classifications were poorly suited to such arrangements. Individuals who might serve only a few days each month were often subject to the same legal requirements applicable to full-time employees, creating uncertainty and discouraging participation.
B. Conflict-of-Interest Reform
The issue gained increasing attention during congressional consideration of revisions to Federal conflict-of-interest statutes. Policymakers recognized the need to reconcile two objectives:
- Preserving public confidence in the integrity of government decision-making.
- Encouraging the participation of distinguished outside experts in government service.
The prevailing view among reform advocates was that rigid application of existing rules had the unintended effect of excluding precisely those individuals whose expertise was most valuable to the Government.
As a result, Congress established a distinct legal category: the Special Government Employee.
II. Purpose of the SGE Classification
The SGE designation was intended to recognize a category of personnel whose service differed substantially from that of regular Federal employees.
The principal characteristics of the category include:
• Temporary or intermittent service.
• Service expected to involve a limited number of days during a calendar year.
• Retention by the individual of substantial private professional or commercial activities outside government.
• Applicability of modified conflict-of-interest provisions tailored to the nature of such service.
The central policy assumption underlying the classification was that occasional government service by recognized experts constitutes a public benefit which should not require complete withdrawal from private professional life.
III. Early Implementation
A. Agencies Making Extensive Use of SGEs
During the initial years following enactment, the largest concentrations of SGEs appeared in agencies dependent upon scientific and technical consultation.
These included:
• Defense-related research organizations.
• Atomic energy programs.
• Space and aeronautics activities.
• Public health agencies.
• Scientific advisory boards and commissions.
Universities became a particularly important source of personnel. Professors and research scientists frequently served on advisory committees while retaining their academic appointments.
B. Advisory Committee Functions
The majority of SGEs were not engaged in routine administrative operations. Instead, they participated in:
• Scientific review panels.
• Technical evaluation committees.
• Medical advisory boards.
• Procurement and research consultations.
• Strategic policy studies.
Many committees met only several times annually, making full-time employment impractical.
Agency officials generally reported that SGE participation increased the quality of technical evaluation and reduced the risk of institutional insularity.
IV. Administrative Advantages
A. Access to Current Expertise
Perhaps the most significant benefit has been the Government’s ability to draw upon individuals actively engaged in their professional fields.
Unlike permanent employees who may become removed from current developments, outside specialists often bring immediate familiarity with emerging technologies, research findings, and industrial practices.
B. Flexibility
The SGE framework permits agencies to assemble temporary groups of specialists for specific tasks without creating permanent positions.
This flexibility has proven especially valuable in fields characterized by rapid technological change.
C. Improved Communication Between Government and Professional Communities
Many officials have observed that SGE service creates channels of communication between Federal agencies and universities, research institutions, and professional organizations.
Such relationships contribute to mutual understanding of national needs and technical capabilities.
V. Emerging Concerns
A. Public Perception
The principal criticism of the SGE system has centered on public perception of divided loyalties.
Because many SGEs maintain private affiliations, observers have occasionally questioned whether advice provided to the Government may be influenced by outside interests.
Although no evidence suggests that such concerns are pervasive, the appearance of potential conflict has generated periodic controversy.
B. Disclosure Requirements
Agencies have adopted varying procedures regarding financial disclosure and conflict review.
The absence of complete uniformity has complicated administration and occasionally produced uncertainty among appointees.
Several departments have recommended greater standardization.
C. Advisory Influence
A broader policy concern involves the role of expert advisers in democratic governance.
Some observers have expressed apprehension that increasing reliance upon scientific and technical experts may diminish the influence of elected officials or career administrators.
Agency experience to date indicates that SGEs generally function in an advisory capacity and do not exercise independent authority. Nevertheless, questions regarding appropriate boundaries remain subjects of continuing discussion.
VI. Case Illustrations
A review of representative appointments demonstrates the diversity of SGE service.
Case A: University Scientist
A distinguished physicist served periodically on a defense research advisory panel while continuing full-time university employment. Agency officials reported that the scientist’s participation provided access to developments not yet widely disseminated within government laboratories.
Case B: Medical Specialist
A physician retained by a public health agency assisted in the evaluation of emerging treatment protocols. Because the physician remained active in clinical practice, recommendations reflected current medical experience unavailable through administrative channels alone.
Case C: Industrial Engineer
An engineer employed in private industry participated in technical assessments involving manufacturing methods relevant to national defense requirements. Appropriate conflict review procedures were employed to avoid participation in matters directly affecting the employer.
VII. Assessment
The evidence available at the conclusion of 1966 supports several observations.
First, the SGE classification has successfully addressed a genuine administrative need. Modern government increasingly requires specialized knowledge that cannot always be supplied through permanent staffing arrangements.
Second, concerns regarding conflicts of interest are real and should not be dismissed. The credibility of the program depends upon rigorous review procedures and transparent standards.
Third, the effectiveness of the system derives from its balanced approach. Excessive restrictions may discourage participation by qualified experts, while insufficient safeguards may undermine public confidence.
VIII. Recommendations
- Establish more uniform disclosure procedures across Executive Branch agencies.
- Expand training concerning conflict-of-interest obligations for newly appointed SGEs.
- Improve recordkeeping regarding the utilization and activities of advisory committees.
- Conduct periodic reviews to determine whether existing legal standards remain adequate.
- Preserve the flexibility of the SGE classification while strengthening public accountability measures.
Conclusion
The Special Government Employee program represents a significant adaptation of Federal personnel policy to the requirements of a technologically advanced society. It reflects recognition that effective governance increasingly depends upon access to expertise located outside the permanent structures of government.
While the program presents continuing challenges in the areas of ethics and public confidence, experience to date suggests that the benefits substantially outweigh the difficulties. The central task for future administrators will be to maintain an appropriate balance between expert participation and public accountability.
Prepared for Internal Administrative Review
Office of Administrative Management
December 1966
CONFIDENTIAL
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