dent, by and with the advice and consent of the Senate, and shall receive compensation at the rate of $14,000 a year. The purpose of the Board shall be to advise the Secretary of Defense as to the status of scientific research relative to the national security, and to assist him in assuring, adequate provision for research and development on scientific problems relating to the national security. "(b) The Board, or if the Secretary of Defense should so prescribe, the Chairman, after consultation with the Board, shall assist the Secretary of Defense in performing such duties as the Secretary of Defense may direct, including, in the discretion of the Secretary of Defense, any or all of the following 66 (1) preparation of a complete and integrated program of research and development for military purposes; "(2) advising with regard to trends in scientific research relating to national security and the measures necessary to assure continued and increasing progress; "(3) coordination of research and development among the military departments, and allocation among them of responsibilities for specific programs; "(4) formulation of policy for the Department of Defense in connection with research and development matters involving agencies outside the Department of Defense; and "(5) consideration of the interaction of research and development and strategy, and advising the Joint Chiefs of Staff in connection therewith. "(c) When the Chairman of the Board first appointed has taken office, the Joint Research and Development Board shall cease to exist and all its records and personnel shall be transferred to the Research and Development Board. "(d) The Secretary of Defense shall provide the Board with such personnel and facilities as the Secretary may determine to be required by the Board for the performance of its functions." COMPENSATION OF SECRETARY OF DEFENSE, DEPUTY SECRETARY OF DEFENSE, SEC. 9. (a) Section 301 of the National Security Act of 1947 is amended to read as follows: "SEC. 301. (a) The Secretary of Defense shall receive the compensation prescribed by law for heads of executive departments. "(b) The Deputy Secretary of Defense shall receive compensation at the rate of $14,500 a year. "(c) The Secretary of the Army, the Secretary of the Navy, and the Secretary of the Air Force shall each receive compensation at the rate of $14,000 a year." (b) Section 303 (a) of the National Security Act of 1947 is amended to read as follows: "(a) The Secretary of Defense, the Chairman of the National Resources Board, the Director of Central Intelligence, and the National Security Council, acting through its Executive Secretary, are authorized to appoint such advisory committees and to employ, consistent with other provisions of this Act, such parttime advisory personnel as they may deem necessary in carrying out their respective functions and the functions of agencies under their control. Persons holding other offices or positions under the United States for which they receive compensation, while serving as members of such committees, shall receive no additional compensation for such service. Other members of such committees and other part-time advisory personnel so employed may serve without compensation or may receive compensation at a rate not to exceed $50 for each day of service, as determined by the appointing authority." REORGANIZATION OF FISCAL MANAGEMENT TO PROMOTE ECONOMY AND EFFICIENCY SEC. 10. The National Security Act of 1947 is amended by inserting at the end thereof the following new title: "TITLE IV "PROMOTION OF ECONOMY AND EFFICIENCY THROUGH ESTABLISHMENT OF UNIFORM BUDGETARY AND FISCAL PROCEDURES AND ORGANIZATIONS "COMPTROLLER OF DEPARTMENT OF DEFENSE "SEC. 401. (a) In order to implement the provisions of section 202 (a) conferring upon the Secretary of Defense authority and control over the military budget, there is hereby established in the Office of the Secretary of Defense an 89469-49-18 office to be known as the Office of Comptroller of the Department of Defense, which shall be headed by a Comptroller to be appointed from civilian life by the Secretary of Defense and who shall receive compensation at the rate prescribed by law for special assistants to the Secretary of Defense. "(b) The Comptroller shall advise and assist the Secretary of Defense in performing such budgetary and fiscal functions as may be required to carry out the powers conferred upon the Secretary of Defense by section 202 (a) of this Act and by this title, including but not limited to those specified in this subsection. Subject to the authority and direction of the Secretary of Defense, the Comptroller shall "(1) supervise and direct the preparation of the budget estimates of the Department of Defense; and "(2) establish, and supervise the execution of "(A) principles, policies, and procedures to be followed in connection with organizational and administrative matters relating to "(i) the preparation and execution of the budgets, "(ii) fiscal, cost, operating, and capital property accounting. "(iii) progress and statistical reporting, "(B) policies and procedures relating to the expenditure and collection of funds administered by the Department of Defense; and "(3) establish uniform terminologies, classifications, and procedures in all such matters. "MILITARY DEPARTMENT BUDGET AND FISCAL ORGANIZATION-DEPARTMENTAL COMPTROLLERS "SEC. 402. (a) The Secretary of Defense shall cause budgeting, accounting, progress and statistical reporting, and administrative organization structure and managerial procedures relating thereto in each of the military departments to be organized and conducted in a manner consistent with the operations of the Office of the Comptroller of the Department of Defense. "(b) There is hereby established in each of the three military departments the Office of Comptroller. Subject to the authority of the Secretary of Defense as set forth in section 202 (a) of this Act and the authority granted by this title, and subject to the authority of the respective departmental Secretaries, the comptrollers of the military departments shall be responsible for all budgeting, accounting, and progress and statistical reporting in their repective departments and for the administrative organization structure and managerial procedures relating thereto. The Secretaries of the military departments may in their discretion appoint either civilian or military personnel as comptrollers of the military departments. Departmental comptrollers shall be under the direction and supervision of, and directly responsible to, either the Secretary, the Under Secretary, or an Assistant Secretary of the respective military departments. Where the departmental comptroller is not a civilian, the Secretary of the department concerned shall appoint a civilian as Deputy Comptroller. "PERFORMANCE BUDGET "SEC. 403. (a) The budget estimates of the Department of Defense shall be prepared, presented, and justified, where practicable, and authorized programs shall be administered, in such form and manner as the Secretary of Defense, subject to the authority and direction of the President, may determine, so as to account for, and report, the cost of performance of readily identifiable functional programs and activities, with segregation of operating and capital programs. So far as practicable, the budget estimates and authorized programs of the military departments shall be set forth in readily comparable form and shall follow a uniform pattern. "(b) In order to expedite the conversion from present budget and accounting methods to the cost-of-performance basis contemplated in this title, the Secretary of Defense, with the approval of the President, is authorized and directed, until the end of the second full fiscal year following the date of enactment of this Act, to make such transfers and adjustments within each military department between appropriations available for obligation by such department in such manner as he deems necessary to cause the obligation and administration of funds and the reports of expenditures to reflect the cost of performance of such programs and activities. Reports of transfers and adjustments made pursuant to the authority of this subsection shall be made currently to the President and the Congress. "PROGRAM ADJUSTMENTS "SEC. 404. After the end of the second full fiscal year following the date of enactment of this Act, the Secretary of Defense, with the approval of the President, is authorized and directed to make transfers and adjustments between appropriations within each military department in order to provide maximum economy and efficiency in the operation of programs for which appropriations may be made from time to time, but no appropriation shall be increased or decreased thereby by more than 5 per centum. Reports of transfers and adjustments made pursuant to the authority of this section shall be made currently to the President and the Congress. "AUTHORIZATIONS FOR APPROPRIATIONS "SEC. 405. In order to provide the most effective control by the President and the Congress over the moneys in the Treasury not appropriated to specific purposes and to achieve economy and efficiency in matters arising out of the availability and expenditure of moneys which may, from time to time, be appropriated to the Department of Defense, no requests for legislation, which, if enacted, would authorize any appropriations to be made to any of the military departments, shall be transmitted to the Bureau of the Budget, the President, or the Congress by the military department concerned, or by the Department of Defense, without the prior approval of the Secretary of Defense. "OBLIGATION OF APPROPRIATIONS "SEC. 406. In order to prevent overdrafts and deficiencies in any fiscal year for which appropriations are made, on and after the beginning of the next fiscal year following the date of enactment of this Act appropriations made to the Department of Defense or to the military departments and reimbursements thereto, shall be available for obligation and expenditure only after the Secretary of Defense shall approve scheduled rates of obligation, or modifications thereof: Provided, however, That nothing in this section shall affect the right of the Department of Defense to incur deficiencies under any existing laws or prevent it from incurring deficiencies in order to meet the requirements of national interest or security arising out of emergencies which may be declared by the President to exist, and in such event to the extent that he may direct. "WORKING-CAPITAL FUNDS "SEC. 407. (a) In order more effectively to control and account for the cost of programs and work performed in the Department of Defense, the Secretary of Defense is authorized to require the establishment of working-capital funds in the Department of Defense for the purpose of- "(1) financing inventories of such stores, supplies, materials, and equipment as he may designate; and "(2) providing working capital for such industrial-type activities, and for such commercial-type activities as provide common services within or among the departments and agencies of the Department of Defense, as he may designate. "(b) The Secretary of the Treasury is authorized and directed to establish on the books of the Treasury Department at the request of the Secretary of Defense the working-capital funds established pursuant to the authority of this section. "(c) Such funds shall be “(1) charged, when appropriate, with the cost of stores, supplies, materials, and equipment procured or otherwise acquired, manufactured, repaired, issued, and consumed and of services rendered or work performed, including applicable administrative expenses; and "(2) reimbursed from available appropriations or otherwise credited for the cost of stores, supplies, materials, or equipment furnished and of services rendered or work performed, including applicable administrative expenses. Reports of the condition and operations of such funds shall be made annually to the President and to the Congress. "(d) The Secretary of Defense is authorized to provide capital for such working-capital funds by capitalizing inventories on hand and, with the approval of the President, by transfer, until December 31, 1954, from unexpended balances of any appropriations of the military departments not carried to the surplus fund of the Treasury: Provided, That no deficiency shall be incurred in any such appropriation as a result of any such transfer. To the extent that such methods do not, in the determination of the Secretary of Defense, provide adequate amounts of working capital, there is hereby authorized to be appropriated, out of any moneys in the Treasury not appropriated for other purposes, such sums as may be necessary to provide adequate working capital. "(e) Subject to the authority and direction of the Secretary of Defense, the Secretaries of the military departments shall allocate responsibility within their respective military departments for the execution of functions which each military department is authorized by law to perform in such a manner as to effect the most economical and efficient organization and operation of the activities and use of the inventories for which working-capital funds are authorized by this section. "(f) No greater cost shall be incurred by the requisitioning agency for stores, supplies, materials, or equipment drawn from inventories, and for services rendered or work performed by the industrial-type or commercial-type activities for which working-capital funds are authorized by this section, than the amount of appropriations or funds available for such purposes. "(g) The Secretary of Defense is authorized to issue regulations to govern the operation of activities and use of inventories authorized by this section, which regulations may, whenever he determines the measures set forth in this subsection to be required by the needs of the Department of Defense, and when they are authorized by law, permit stores, supplies, materials, and equipment to be sold to, and services to be rendered or work performed for, purchasers or users outside the Department of Defense. In such cases, the working-capital funds involved may be reimbursed by charges against appropriate appropriations or by payments received in cash. "(h) The appraised value of all stores, supplies, materials, and equipment returned to such working-capital funds from any department, activity, or agency, may be charged to the working-capital fund concerned and the proceeds thereof shall be credited to the current appropriations concerned; the amounts so credited shall be available for expenditures for the same purposes as the appropriations credited: Provided, That the provisions of this subsection shall not permit credits to appropriations as the result of capitalization of inventories authorized by subsection (d) of this section. "MANAGEMENT FUNDS "SEC. 408. The Act of July 3, 1942 (56 Stat. 645, c. 484), as amended, is hereby further amended to read as follows: "(a) For the purpose of facilitating the economical and efficient conduct of operations in the Department of Defense which are financed by two or more appropriations where the costs of the operations are not susceptible of immediate distribution as charges to such appropriations, there are hereby established the Navy Management Fund, the Army Management Fund, and the Air Force Management Fund, each within, and under the direction of the respective Secretaries of, the Departments of the Navy, Army, or Air Force, as the case may be. There are authorized to be appropriated from time to time such funds as may be necessary to accomplish the purposes of the funds. "(b) The corpus of the Navy Management Fund shall consist of the sum of $1,000,000 heretofore transferred to the Naval Procurement Fund from the Naval Emergency Fund (17X0300), which amount, and all balances in, and obligations against, any accounts in the Naval Procurement Fund, are hereby transferred to the Navy Management Fund; the corpus of the Army Management Fund shall consist of the sum of $1,000,000, which shall be transferred thereto from any unobligated balance of any appropriation available to the Department of the Army; the corpus of the Air Force Management Fund shall consist of the sum of $1,000,000, which shall be transferred thereto from any unobligated balance of any appropriation available to the Department of the Air Force; in each case together with such additional funds as may from time to time be appropriated to any of said funds. Accounts for the individual operations to be financed under the respective management funds shall be established only upon approval by the Secretary of Defense. (c) Expenditures may be made from said mangement funds from time to time for material (other than material for stock) and for personal and contractual services, under such regulations as may be prescribed by the Secretary of Defense: Provided, (1) That no obligation shall be incurred against any such fund which is not properly chargeable to available funds under an appropriation of the department within which the funds is established or, whenever necessary to effectuate purposes authorized by this Act, as amended, to funds of another department or agency within the Department of Defense, and (2) that each fund shall be promptly reimbursed from the appropriate appropriations of such department for all expenditures properly chargeable thereto. Nothing herein or in any other provision of law shall be construed to prevent advances by check or warrant, or reimbursements to any of said management funds from appropriations of said departments on the basis of the estimated cost of a project such estimated cost to be revised and necessary appropriation adjustments made when adequate data become available. "(d) Except as otherwise provided by law, amounts advanced to the management funds under the provisions of this Act shall be available for obligation only during the fiscal year in which they are advanced: Provided, however, That nothing contained in this Act shall alter or limit the authorized period of availability of the funds from which such advances are made. Final adjustments of advances in accordance with actual costs shall be effected with the appropriate funds for the fiscal year. "(e) The portion of the Naval Appropriation Act, 1945 (58 Stat. 301, 310), relating to the Naval Procurement Fund is hereby repealed.' "ADJUSTMENT OF ACCOUNTS "SEC. 409. (a) When under authority of law a function or an activity is transferred or assigned from one department or agency within the Department of Defense to another such department or agency, the balances of appropriations which are determined by the Secretary of Defense to be available and necessary to finance or discharge the function or activity so transferred or assigned may, with the approval of the President, be transferred to, and be available for use by, the department or agency to which said function or activity is transferred or assigned for any purpose for which said funds were originally available. Balances so transferred shall be credited to any applicable existing appropiration account or accounts, or to any new appropriation account or accounts, which are hereby authorized to be established on the books of the Treasury Department, of the department or organization to which such function or activity is transferred, and shall be merged with funds in the applicable existing or newly established appropriation account or accounts and thereafter accounted for as one fund. Balances transferred to existing accounts shall be subject only to such limitations as are specifically applicable to such accounts and those transferred to.new accounts shall be subject only to such limitations as are applicable to the appropriations from which they are transferred. "(b) The number of employees which in the opinion of the Secretary of Defense is required for such transferred functions or activities may, with the approval of the Director of the Bureau of the Budget, be deducted from any personnel maximum or limitation of the department or agency within the Department of Defense from which such function or activity is transferred, and added to any such personnel maximum or limitation of the department or agency to which such function or activity is transferred. "AVAILABILITY OF REIMBURSEMENTS "SEC. 410. To carry out the purposes of this Act, reimbursements made under the authority of the Economy Act (31 U. S. C. 686), and sums paid by or on behalf of personnel of any department or organization for services rendered or supplies furnished, may be credited to authorized replacing or other accounts. Funds credited to such accounts shall remain available for obligation for the same period as the funds in the account so credited and each such account shall constitute one fund on the books of the Treasury Department. "COMMON USE OF DISBURSING FACILITIES "SEC. 411. To the extent authorized by the Secretary of Defense, disbursing officers of the Departments of the Army, Navy, and Air Force may, out of accounts of advances available to them, make disbursements covering obligations arising in connection with any function or activity of any other department or organization within the Department of Defense and charge upon vouchers the proper appropriation or appropriations of the other department or organization: Provided, That all said expenditures shall subsequently be adjusted in settlement of disbursing officers' accounts. "REPORTS OF PROPERTY "SEC. 412. The Secretary of Defense shall cause property records to be maintained in the three military departments, so far as practicable, on both a |