Based on that report, the President has concluded that the laboratory systems of the Department of Defense, the Department of Energy, and the National Aeronautics and Space Administration provide essential services to the Nation in fundamental science, national security, environmental protection, energy, aerospace, and technologies that contribute to industrial competitiveness.

It is imperative that the national investment in these resources be used in the most efficient and effective manner possible. On the basis of the Vice President's National Performance Review, and of the National Science and Technology Council Interagency Federal Laboratory Review, much has been done in implementing reforms in management of the Nation's three largest laboratory systems. To ensure the best management and return on Federal expenditures, the President has provided further guidance to the heads of Agencies for implementation of management reforms within the federal laboratory system.

In implementing reforms of the federal laboratory system, agencies will adhere to the following general guidelines and principles:

1. Agencies will review and, as appropriate, rescind, internal management instructions, regulations, and redundant oversight that impede laboratory performance.

2. Agencies will clarify and focus mission assignments for their laboratories, eliminating redundancy and restructuring the laboratory systems as appropriate and necessary.

3. In their efforts to achieve greater efficiency and effectiveness in their laboratory systems, agencies will first seek to achieve all possible savings through streamlining and improving management. Then, as necessary, they will reduce or eliminate lower priority programs, in accordance with guidance from the Office of Management and Budget and the Office of Science and Technology Policy, based on priorities set by the National Science and Technology Council and, as appropriate, the National Security Council.

4. Agencies will continue to explore opportunities to coordinate and integrate laboratory resources and facilities on an interagency and inter-service basis, eliminating unnecessary duplication and establishing joint management where appropriate.

In accordance with this conclusion, the Department of Energy is directed to maintain nuclear weapons responsibilities and capabilities adequate to support the science-based stockpile stewardship program required to ensure continued confidence in the safety and reliability of the nuclear weapons stockpile in the absence of nuclear testing. The Joint Report on the Stockpile Stewardship required by Presidential Directive and submitted annually to the NSC Interagency Working Group shall be developed consistent with this requirement.

Informed by that review, I am announcing today an initial set of directives which will affect these laboratories well into the future.

I have concluded that these laboratories provide essential services to the Nation in fundamental science, national security, environmental protection and cleanup, and industrial competitiveness. Many of these laboratories are equipped with research tools that are among the finest in the world. They employ personnel with extraordinary, and in many cases irreplaceable, talent. These labs have contributed greatly to our Nation in the past, and hold the potential for contributions of tremendous importance in the future.

One example where the National laboratories can help change the course of history is with respect to nuclear weapons. On August 11, 1995, 1 announced my decision to seek a "zero" yield Comprehensive Test Ban Treaty (CTBT). I was able to make that decision based on assurances by the Secretary of Energy and the Directors of the Department of Energy's nuclear weapons labs that we can meet the challenge of maintaining our nuclear deterrent under a CTBT through a Science-Based Stockpile Stewardship program without nuclear testing.

To meet the challenge of ensuring confidence in the safety and reliability of our stockpile, I have concluded that the continued vitality of all three DOE nuclear weapons laboratories will be essential.

In accordance with this conclusion, I have directed the Department of Energy to maintain nuclear weapons responsibilities and capabilities adequate to support tiie science-based stockpile stewardship program required to ensure continued confidence in the safety and reliability of the nuclear-weapons stockpile in the absence of nuclear testing. Stable funding for this effort based on bipartisan support will be necessary in order to meet this requirement.

Strong bipartisan support equally is necessary across a broad range of other science and technology programs being performed in Federal laboratories, academia, and the private sector. Since the beginning of my Administration, we have placed a high priority on investments in science and technology. We believe that few areas of Federal spending will be more important to the well-being of future generations than R&D. We are deeply concerned about budget actions that could cripple our capacity to find new ways of solving the scientific and technological challenges of the 21st century.

Among our greatest strengths as our Nation moves into the next century will be our ability to innovate -- to design new drugs, to find new ways to enhance our national security, to develop new tools for managing enormous mnounts of information, to generate new ways of harnessing energy, to produce new materials and processes that result in new products and industries at lower cost and with less pollution, and to expand the frontiers of our knowledge of the universe. These laboratories have excelled in such innovations as these, and will continue to yield great public dividends for our Federal investment.

At the same time, these labs must be run as efficiently as possible. I have directed the Agencies to review and, as appropriate, to rescind internal management instructions and oversight that impede laboratory performance. I have directed the Agencies to clarify and focus the mission assignments of their laboratories. I also have directed the Agencies to achieve all possible budget savings through streamlining and management improvements before productive R&D progrwns are sacrificed. Many Agencies and laboratories already are making important progress in each of these areas of management reform.

It has been said that R&D investments are an expression of our confidence as a Nation in our ftiture. Today we are reaping the benefits of those who wisely invested in Federal R&D in the past. While it would be easy to destroy premier Federal laboratories through severe budget cuts or senseless closures, that is not a path that this Administration will follow. We will invest in our Federal laboratories, while pursuing aggressive management reforms that ensure the maximum productive output for the taxpayers' investments.