GAO identifies billions in potential savings from duplicative federal programs

The federal government could save billions of dollars a year by reducing improper payments; trimming duplicative, overlapping and fragmented programs; and enhancing competition among contractors, among other measures, according to a massive new report today from the Government Accountability Office.

The report comes as lawmakers are trying to reach a budget deal to avoid a shutdown of the federal government. Cutting costs -- by how much and in what ways -- is the sticking point for disagreement.

Comptroller General Gene Dodaro released the 345-page report to Congress, titled “Opportunities to Reduce Potential Duplication in Government Programs, Save Tax Dollars and Enhance Revenue,” under a new law requiring that the congressional watchdog agency generate an annual list of potentially redundant government programs. The GAO expanded the scope of the report to identify other areas of potential wasteful spending and unrealized opportunities for larger revenues.

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The report identifies 34 areas of potential duplication and fragmentation, and 47 other areas where savings may be reaped or revenues increased.

Many of the problems were identified in previous GAO reports; however, the new report offers a comprehensive look across the government with specific estimates of savings or revenue enhancements given in some of the examples.

One of the largest areas targeted for savings is the estimated $125 billion annual cost of improper federal payments, which are any payments that should not have been made, or were made in the incorrect amount. About 20 federal agencies estimated improper payments for 70 programs, totaling an error rate of about 5.5 percent.

Billions more could be saved by reducing duplication and overlap in domestic ethanol production programs, food safety, job training, domestic food assistance, homeless assistance, teacher quality, financial literacy, bio-defense, military health systems and weapons systems, and international development programs, among others, the GAO report said.

Also under the microscope in the report are policies and practices related to federal contracting, which the GAO said could be modified to potentially save billions of dollars, though exact amounts were not specified.

“Promoting competition for the over $500 billion in federal contracts can potentially save billions of dollars over time,” the report said. “Applying strategic sourcing best practices throughout the federal procurement system could save billions of dollars annually. Adherence to new guidance on award fee contracts could improve agencies’ use of award fees and produce savings.”

In addition, the Defense and Veterans Affairs Departments potentially could save money by consolidating some of their $11 billion in annual drug purchases, but the amount of possible savings was not known, the GAO added.

Information technology spending also comes under scrutiny in the report, with the GAO recommending that billions potentially could be saved through enterprise architectures, consolidation of data centers and joint development of a Defense-VA electronic health record system, among other measures.

The Office of Management and Budget’s IT Dashboard is credited with generating $3 billion in savings to date, in the report. The dashboard “can further help identify opportunities to invest more efficiently in information technology,” Dodaro wrote.