New IT systems, policies needed to track government cash

Nine federal agencies reported more than $19 billion in improper financial payments for fiscal 1998, a number that reflects systems and management deficiencies that many agencies do not know how to address because of a lack of governmentwide guidance, according to a recent report by the General Accounting Office.

The payment reports cover a total of 17 programs at agencies such as the Department of Health and Human Services, the Department of Housing and Urban Development and the Social Security Administration. However, audits from GAO, the investigative arm of Congress, and inspectors general at the Defense Department, the Internal Revenue Service and the Education Department show that the problem is widespread, the report said. GAO released the report, "Financial Management: Increased Attention Needed to Prevent Billions in Improper Payments," Nov. 5.

New information systems and processes would enable agencies to track financial payments or double-check whether a person or vendor has received a payment from that or any other agency, the report said. But few agencies are putting in place such improvements, and four of the nine—including HHS, which reported the highest number of improper payments for Medicare at $12.6 billion—do not address the issue at all in their performance plans.

Lack of governmentwide guidance on how to identify and estimate the value of improper payments has led to many of the problems that agencies are experiencing, GAO said. GAO recommended that the director of the Office of Management and Budget develop and issue such guidance and require that descriptions of the steps being taken by agencies be included in performance plans when the level of improper payments is mission critical.