South Carolina government could save millions of dollars a year and become more efficient, effective and responsive to taxpayers if it invested in a permanent office to review agency performance.

It's working in other states. So why can't it work here?

Starting in 1991, Texas institutionalized a permanent performance review process that has generated dozens of reports and saved billions of dollars. Now called Strategic Policy Initiatives, it is a division of the Texas Comptroller's Office and focuses on reviews of government agencies, programs and operations, and recommends improvements to increase efficiency and effectiveness.

Over the last three years in New Mexico, Gov. Bill Richardson hired outside consultants to work with government employees to identify savings and figure out ways for agencies to operate better. In a state that has about half of the budget of South Carolina, the project delivered two reports with more than 130 recommendations for $500 million in savings over five years. Lawmakers have implemented more than 80 of 92 recommendations in the first report and reaped about $75 million in efficiencies and savings in the first year.

S.C. Gov. Mark Sanford called for a similar process with his MAP Commission (Measurement, Accountability and Performance) study at the beginning of his term. Unlike the Texas and New Mexico reports, however, the South Carolina study was run by business people, not experts in the field of performance reviews. While they identified millions of savings, some of the conclusions drawn were hard to replicate because they provided inadequate documentation or source data.

In other words, Sanford's good idea was done "on the cheap," which produced results that weren't as helpful as if professionals had done the work.

That being said, the governor was onto something. Buried in last year's executive budget was a recommendation to spend $400,000 for a new office called the State Inspector General to look for "waste, fraud and abuse" in executive agencies. Similarly, a House restructuring bill (H. 3009) calls for a similar office, but estimates annual expenses could reach $1.1 million to do it right.

As one of the consultants who participated in one of the New Mexico studies, it's heartening to see South Carolina want to invest in a process to review how agencies are performing because such oversight encourages optimal functioning. However, it seems South Carolina policymakers are missing the point with the way they're defining the proposed process.

The House bill and governor's proposal focus on a new oversight agency to review "waste, fraud and abuse," a term that has become a political cliché. Both call for a state inspector general for six years to be appointed by the governor and approved by the Senate. Both suggestions have problems.

First, focusing on waste, fraud and abuse is setting a negative mission for a new agency. It highlights a belief that the framers of the new job assume there are millions of dollars of waste, fraud and abuse with state money and that they'll root it out. In reality, however, budget cuts over the last few years have trimmed a lot of the fat in state agencies. In reality, gargantuan sums of state money are not being wasted by state agencies. Because their resources have been cut over and over, they can't afford to waste lots of money.

A better solution to this problem is to make the mission of a new agency focus on improving performance, highlighting efficiencies, identifying best practices and finding ways to improve customer services for taxpayers. In other words, define the new agency with a positive mission, as was done in Texas and as was the overarching theme behind New Mexico's project.

Second, by putting the agency under the governor's control, there's a strong likelihood the agency itself could be abused politically as a hammer to nail any state operation a governor didn't like. Lawmakers should consider another structure that creates a non-partisan Inspector General's office that uses outside professionals to conduct independent, verifiable reviews of key agencies.

If the state invested $1 million a year in a new independent Inspector General's office, it likely can reap $100 million annually in efficiencies, improving customer service and boosting performance of state agencies. And, of course, it will be able to find any "waste, fraud and abuse" that does, in fact, exist.