Summary: This testimony discusses the role of incentive programs in motivating and rewarding federal employees to achieve high performance in support of agency missions and goals. GAO found that federal agencies have broad statutory and regulatory authority to design and implement various incentive programs, including monetary and nonmonetary incentives. No one incentive program is optimal for all situations. Second, the use of monetary incentive programs has varied over time and across agencies. During the last five years, agencies have made less use of their performance awards and greater use of other monetary incentives. The proportion of employees who received monetary performance awards ranged from less than one percent to as much as 75 percent of an agency's workforce. Little is known about the use of nonmonetary incentives because they are harder to measure and generally not documented. Finally, some agencies regularly monitor and evaluate the effectiveness of their incentive programs; however, many others have reported that they did not know whether their incentive programs were effective in motivating their employees to exceed expectations in support of missions and goals.
