Waste of the Day: Ignoring Improper Payment Requirements

Topline: The Environmental Protection Agency, Department of Defense and Office of Personnel Management violated the Payment Integrity Information Act by publishing inaccurate estimates of their improper payments last year, according to recent federal audits.

Improper payments represent serious money

Key facts: Improper payments — sent to the wrong person, for the wrong amount or the wrong reason — cost the federal government $161.5 billion in fiscal year 2024, and nearly $1 trillion in the last four years. 

The DOD is only required to estimate improper payments for some of its salary and travel expenses. Those programs mistakenly paid $1.1 billion last year, but the agency’s inspector general says that is an “unreliable estimate” for the 14th consecutive year.

Other DOD programs do not have to estimate their improper payments because they are supposedly “low risk,” but some of them may actually have high risk. Auditors found that the Navy’s travel pay department had improper payments exceeding either $100 million or 1.5% of total spending, meaning they should have been required to estimate their improper payments.

The Office of Personnel Management made $593 million of improper payments last year, which is also an underestimate. Auditors found that the OPM’s Federal Employees Health Benefits did not publish an estimate of its improper payments in 2023 or 2024. The program says it “remains on track” to finally publish an estimate in 2025.

The EPA claimed that it paid grant awards with an improper payment rate of just 0.8%, but the agency forgot to include $222 million worth of grants in its math. Auditors “could not determine whether the published estimate is valid” because the EPA did not keep any documentation to explain how it calculated its estimate.

Only the IG can even give a signal that anything is wrong

Search all federal, state and local government salaries and vendor payments with the world’s largest government spending database at OpenTheBooks.com. 

Background: If not for the inspector general reports, most people in Washington would never notice that payment accuracy requirements are not being met. The Government Accountability Office report recently found that several Congressional staffers have never even heard of PaymentAccuracy.gov, the Treasury website that tracks improper payments.

Summary: It’s bad enough that the federal government is spending billions of dollars by mistake every single year. At the very least, they should be able to properly estimate how much has been lost.

The #WasteOfTheDay is brought to you by the forensic auditors at OpenTheBooks.com

This article was originally published by RealClearInvestigations and made available via RealClearWire.