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Tuesday, September 12, 2000
THOMPSON RELEASES REPORT DETAILING $20.7 BILLION IN LOST
TAXPAYER DOLLARS DUE TO IMPROPER PAYMENTS
Says Most Federal Agencies Still Not Reporting Their Losses
WASHINGTON, DC - Senate Governmental Affairs Committee Chairman Fred Thompson (R-TN), joined
by Citizens Against Government Waste President Thomas A. Schatz, today released a report outlining $20.7
billion - or about $300 for each American family - in improper payments lost by the 20 government
programs that reported their fiscal year 1999 losses to the General Accounting Office.
"It's astounding that more than $20 billion of taxpayer money was sqaundered by just a handful of federal
programs. And that's just a drop in the bucket," Senator Thompson said. "The total figure for the thousands
of government programs would be much, much higher. Federal agencies need to do a better job managing -
first in terms of detecting improper payments, and then in stopping them."
"The unauthorized government payments detailed in the GAO report are not differences of political opinion.
They are inexcusable government deficiencies, and they are increasing each year," Schatz said. "Even more
alarming is that several agencies made improper payments but don't know their magnitude. Stockholders do
not tolerate such mismanagement in the private sector; taxpayers should be equally outraged at such neglect
of their investment in Washington."
Thompson announced he is introducing legislation requiring the use of a management technique called
'recovery auditing' which would be applied to a Federal agency's records to identify improper payments or
payment errors made by the agency. Recovery auditing utilizes computer programs that are capable of
analyzing agency contract and payment records to identify discrepancies between what was owed and what
was paid. The legislation has been approved by the House.
Improper payments result from a variety of causes ranging from bureaucratic errors - such as paying
someone twice - to outright fraud. Among the improper payments identified in the latest GAO report (with
the program's performance in fiscal year 19998 in parenthesis) are:
- Medicare Fee-for-Service $13.5 billion
(up from $12.6)
- Supplemental Security Income $1.58 billion (down from $1.65
billion)
- Old Age and Survivors Insurance $1.3 billion (up from $1.2 billion)
- Food Stamps
$1.29 billion (down from $1.42 billion)
- Disability Insurance $1.1 billion (up from $941 million)
- Housing Subsidies $935 million (up from $857 million)
"It's very disappointing that several programs fared worse the second time around, but at least we now have
a way to track their performance. Most agencies still aren't reporting their losses and we just don't know
how many taxpayer dollars are being lost," Thompson said, noting that, for example, according to a draft
report by IRS Inspector General, overpayments in the Earned Income Tax Credit program could total more
than $9 billion annually.
Statement
on Recovery Auditing
Letter to the Federal Accounting Standards Advisory
Board
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