Shultz Orders Staff Cutbacks in Budget Drive

Secretary of State George P. Shultz announced Friday a major cutback and reorganization in the State Department as a result of congressionally ordered budget cuts.

Shultz, saying he would “start at the top,” told a group of Foreign Service officers that 21 positions will be cut on the seventh floor, where Shultz and his principal aides work.

He said there also will be cutbacks in his travel and in other diplomatic missions, and that 13 consulates and two other diplomatic posts will be closed in the coming year. He did not name the posts.

The State Department has about 160 consulates and embassies in operation, but 13 of them have been closed in the last two years because of budget cuts.

Shultz said the proposed cuts will save about $59 million in the first year and $116 million in the following year.

‘Dismayed at Prospect’

The American Foreign Service Assn., which represents professionals in their dealing with the department, said it “is dismayed at the prospect of reduced diplomatic capability during a critical time in international relations.”

Shultz said there would be a consolidation within the department, with fewer deputy assistant secretaries of state, the layer of the diplomatic bureaucracy that is often the training ground for senior professionals who become ambassadors.

There also will be an early retirement program, Shultz said, but the department will avoid arbitrary reduction-in-force layoffs that have been used in some government agencies.

He also said the State Department is going to begin charging other federal agencies for work it does for them, including housing their offices overseas.

“I deliver this message with great regret because I don’t think what we are doing is in our interest, but we must live within the money Congress gives us,” Shultz said.