The Federal Government can no longer do its work without universities and without the help of the "highly trained people" who pursue their investigations there, President Pusey said yesterday in his annual report to the Board of Overseers.

At the same time, the universities find that the Government is of "enormous and increasing" importance to them, he said, particularly in fields where Federal fund grants aid educational research.

Pusey also commented on the recent Harvard appointments in Washington as "supplementing the natural process of faculty turnover," but complimented the "taste which our colleague, the President-elect, has shown in his choice of officers."

Pusey's report concentrated primarily on the advances made at the University in the past few years, both in the physical plant and curricula of the College and the graduate schools.

He stressed the role of the Graduate School of Education, through which Harvard makes "its chief contribution to education at the pre-college level." Pusey also mentioned the expanded role of the Graduate School of Public Administration, and urged the Federal Government to take full advantage of the opportunities offered to civil servants to attend universities for advanced training.