Reagan push: austerity at home, leverage abroad; Will hiring ban work?

President Reagan's first official act -- a freeze on federal hiring -- seems destined to cut the payroll, but not necessarily the scale and inefficiency of a government which he claimed in his inaugural address "shows signs of having grown beyond the consent of the governed."

It is estimated that the ban on the hiring of civilian employees by all federal executive departments and agencies, ordered by the President within an hour after being sworn into office, could reduce through attrition in the coming year up to 10 percent of the 2.1 million permanent full-time federal jobs.

That would accelerate a shrinking of the federal work force started by Jimmy Carter, whose partial hiring freeze -- allowing the replacement of only one of every two departing workers -- helped trim government employment by some 400,000 .

An initial wave of retirements by 60,000 to 100,000 US employees, many of them seniors managers, is expected in the next month. The total is likely to be swelled by coming raises in federal retirement benefits.

But recent experience indicates that the mere fact of having fewer government workers does not necessarily mean that the federal establishment will engage in fewer activities, provide work for fewer persons, or perform more efficiently.

Veterans of past across-the-board hiring restrictions say that, in fact, the cuts often foster inefficiency by opening random gaps in office staffs that cause delays, backups, and misuse of personnel.

One congressional expert on the US Civil Service expects pressure from hamstrung agencies to force the hiring freeze to be thawed "within a year."

Work that government agencies find themselves too undermanned to handle, moreover, often is farmed out to private contractors.

The first effort by the new President to make good on his inaugural pledge to "reverse the growth of government" to "relikely to result in more use of this government-dependent industry of consultants, reseachers, and other experts-for-hire which has grown up to service the federal bureaucracy. This in spite of the fact that Mr. Reagan's order stipulates that outside contracting to circumvent the effects of it "must not be permitted."

"Whenever there is any kind of hiring freeze," says a member of the staff of the Senate Civil Service Subcommittee, "parties spring up around the Beltway."

That Interstate highway encrcirling Washington is the location of many of these consulting firms, known by their detractors as the "the Beltway bandits."

Precise dimensions of the booming industry are elusive, but its tens of thousands of contracts with the government are estimated to cost taxpayers anywhere from $400 million to $9 billion a year.

A series of studies by the General Accounting Office, an investigative arm of Congress, has found one-third of consultant contracts of questionable or marginal value to the agencies. And two-thirds of those examined have involved consultants with potential conflicts of interest.

Legislation opening up consultant-contracting procedures to greater public scrutiny, which foundered on Capitol Hill last year, appears likely to be relaunched in the new Congress.

The new chairman of the Civil Service Subcommittee, Sen. Theodore F. Stevens, (R) of Alaska, is said by an aide to be "interested in pursuing some form of consultant reform."

A tough reform bill was championed by the Democratic chairman of the panel in the last Congress, Sen. David H. Pryor of Arkansas. Although Senator Stevens was a cosponsor of that measure, he is expected to seek a milder version now.