Budget Deal Sets Parameters But Many Unknowns
A week after the budget deal, we know a bit more about the impact on federal spending and the implications for FDA. We also have a better sense of the unknown elements that make prediction difficult.
The central tenet is still the ones we explored in Analysis and Commentary over the last 2 weeks (“The Budget Deal - First Impressions from an FDA Perspective” and The Macro- and Micro- Budget Processes and Their Impact on FDA Resources).
Macro-budgetary decisions (e.g. budget caps) limit but do not determine micro-budgetary decisions (e.g., FDA funding)
That is to say…the budget caps are likely to put a hard squeeze on domestic discretionary spending, but the FDA could still get more, less, or the same funding in FY 24 as it is getting in FY 23 (the current fiscal year).
The macro limits created by the budget deal are still subject to a substantial degree of uncertainty. Here is what we don’t know:
How much money will be available to spend on Ag/FDA programs?
As described in last week’s Friday Update, the amount said to be available for non-defense, non-veteran programs is not explicitly defined. Rather it starts with a non-defense total, from which the base amount (plus some increases?) for veterans' health is deducted and then various monies (e.g. from clawbacks) are added back in. We can’t be certain (at least not right now) what each of those components will be and the final cap limit may be different from what has been reported.
Regardless of how total available funds are calculated, there will also be limits created by how much the Ag/FDA Appropriation Subcommittee has to spend (the 302(b) allocations). That number could also be more, less, or the same as in FY 23.
If there are cuts, will they be small enough (or break even) so appropriators are most likely to apply a bit of pain across the board? Or are large and force appropriators into slashing /eliminating some programs in order to adequately fund others?
The 2013 sequester imposed cuts of approximately 5% for all non-defense agencies. In an attempt to soften the blow for FDA, the agency was given an additional $150 million before the application of the sequester. Even so, it was the only decrease in annual appropriations for the FDA in the last 15-plus years.
Had the cut been 20%, it is possible (maybe likely) that appropriators would have chosen to protect some agencies from major losses by imposing larger cuts elsewhere.
Will Republicans continue to fight on—urging cuts at every turn? Will they have the leverage to re-open topics?
The answer–made clearer over the last week–is that some House Republicans will want to treat the caps as a ceiling, and spend less than that amount. To the extent the budget deal caps are aligned with FY23, the objective would be to only spend an amount aligned with FY22.
While appropriators decide, the Alliance will continue to deliver our messages about the importance of FDA and the dangers and risks of an underfunded agency. Our key themes are:
FDA delivers a core government service
FDA needs more resources to fulfill its mission
Underfunding FDA is a threat to public health and commerce.
FDA’s actions are consequential and visible
The Alliance can only continue this work if the FDA stakeholder community supports its aims and contributes to the cost. For more information about membership, please contact Alliance Executive Director, Steven Grossman.
Editorial Note:
The Analysis and Commentary section is written by Steven Grossman, Executive Director of the Alliance for a Stronger FDA.