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PROGRAMS MAKE $19.7 BILLION IN IMPROPER PAYMENTS
Governmental Affairs Ranking Member Thompson Derides
Provision in Farm Bill that Lessens Accountability for Waste
December 13, 2001
(Washington, DC) Senate Governmental Affairs
Ranking Member Fred Thompson (R-TN) today criticized a provision in the pending Farm
Bill which would allow states to continue making billions in improper payments
without penalty for three years.
"The federal government
loses billions and billions in improper payments each year," said Senator
Thompson. "We've been trying to get these agencies to address it for years, yet
supporters of the current Farm Bill just want to make it harder to hold people
accountable."
Thompson released a report
by the General Accounting Office (GAO) that tallied Fiscal Year 2000 improper
payments at well over $19 billion.
Although somewhat less than the previous year's $20.7 billion in
improper payments, GAO wrote in its report, "[A]gency-specific audits and
studies continue to indicate that the extent of the improper payment problem is much
more widespread than has been disclosed in agency financial statement
reports." Other
audits conducted for FY 2000 have disclosed actual instances of improper payments, such as $395
million in improperly paid Earned Income Tax Credits and $148.3 million in
contract overpayments made by the Defense Finance and
Accounting Service.
Thompson said the Bush
Administration has demonstrated its commitment to reducing improper payments -
requiring agencies to report improper payments in their financial statements
and set goals for reducing them. "Agencies will now be required to, at a
minimum, estimate their overpayments," said Thompson.
"With goals to reduce them, we
will be on our way to stemming the loss of billions and billions of taxpayer
dollars. This
Farm Bill goes in the wrong direction."
The pending Farm Bill
includes a provision which would dramatically reduce the sanctions the federal
government could impose on states for making disproportionate improper
payments. For
instance, three years would have to lapse for states to be subject to sanctions for
poor payment practices.
According to the Administration statement on the bill, it "would go
too far in relieving states of their responsibility to
manage Federal resources prudently."
According to the GAO report,
the Food Stamp program, which is authorized in the Farm Bill, made more than
$1.1 billion in improper payments in FY 2000. Examples of erroneous payments include payments
to ineligible persons and payments in the wrong amount, many of which are
less than the beneficiaries are entitled to.
The report issued by the
General Accounting Office is the third annual estimate
of reported improper payments, all of which were
compiled at the request of
Senator Thompson. |