-- A Federal budget for 1986 is essential to maintaining economic recovery. It is up to Congress to act on the budget before they leave for summer vacation.

-- The President will not support a tax increase in the form of an oil import fee. He will not support a change in Social Security COLA's nor will he support a change in tax indexing that protects the working American from inflation-generated tax increases.

-- He firmly believes there is sufficient ground for a compromise between the Senate and the House that can provide in excess of $50 billion in deficit reductions.

-- Deficit reduction is the number one issue in America today. The only way to get true deficit reduction is to cut Federal spending and do so this year.

-- He complimented Senator Dole on his and the Senate's efforts to produce a budget and shares his belief that too much is at stake to allow deficit reduction to fall by the wayside. The Senate and House have come a long way toward agreeing on a budget. Reasonable men and women can agree. It's up to the conferees to meet without delay and act with dispatch. They need to put aside their differences, get down to business, and produce a budget.

-- This afternoon Chief of Staff Don Regan will meet with Budget Committee Chairmen Pete Domenici and William Gray to express the President's desire to have Congress adopt a budget resolution.

Note: Larry M. Speakes read the statement to reporters in the Briefing Room at the White House during his daily press briefing, which began at 9:28 a.m.