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U.S. Department of State

Diplomacy in Action

Net Cost Summary


Bureau of Resource Management
Report
January 15, 2009

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The table below shows the Department’s net cost, which is gross cost less earned revenue, invested in each strategic goal. Strategic Goals are established in the Department’s State-USAID Joint Strategic Plan for 2007 – 2012. Executive Direction costs cannot be reasonably allocated to strategic goals; however, these costs are captured and included in the total net cost of operations. The Department’s total net cost of $17.7 billion is an increase of 30 percent, $4.1 billion, over 2007. The increase in security costs worldwide and the two goals of Achieving Peace and Security and Investing in People account for most of the increase. Achieving Peace and Security, comprising 33 percent of 2008 costs, increased $1 billion in 2008 over 2007, primarily due to an increase of $652 million for International Organizations. International Organizations costs include annual assessments for peacekeeping missions and membership in the United Nations. Costs relating to Investing in People accounted for $936 million of the net cost increase. This was primarily the result of initiatives in 2008 including the new fund established for Global Health and Child Survival. Support costs for Diplomatic Security are distributed to all strategic goals and accounted for $1.6 billion of the increase in net costs. The Department’s strategic goal of Strengthening Consular and Management Capabilities is presented as a negative figure because earned revenue exceeded gross cost; therefore the percent change is not relevant (NR). Additionally, passport and visa issuance included in the goal of Strengthening Consular and Management Capabilities received increased focus in 2008, contributing to $465 million of the net cost increase.

NET COST OF OPERATIONS
For Years Ended September 30, 2008 and 2007
(Dollars in Millions)
Strategic Goal2008
Net Cost
2008 % of
Total Cost
2007
Net Cost
2007 % of
Total Cost
% Change
2008 over 2007
Achieving Peace and Security$ 5,848 33%$ 4,912  35%19%
Governing Justly and Democratically    742  4%    650   5%14%
Investing in People  3,237 18%  2,301  17%41%
Promoting Economic Growth and Prosperity  1,213  7%  1,063   8%14%
Providing Humanitarian Assistance  1,153  6%  1,099   8% 5%
Promoting International Understanding  2,082 12%  1,774  13%17%
Strengthening Consular and Management Capabilities  1,015  6%    (53)  0% NR
Executive Direction and Other Costs Not Assigned  2,451 14%  1,890  14%30%
Total Net Cost of Operations$17,741100%$13,636 100% 

 


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