The US government is botching hundreds of billions of dollars of payments per year, according to a new report.
The Government Accountability Office (GAO) says federal agencies made $236 billion in “improper payments” last year – a number that includes overpayments, inaccurate recordkeeping and fraud.
The agency says the wasteful and erroneous spending is a systemic issue showing a serious weakness in how the government manages money.
“Improper payments—those that should not have been made or were made in the incorrect amount—have consistently been a government-wide issue…
GAO has found that these payments represent a material deficiency or weakness in internal controls.
Specifically, GAO has noted that the federal government is unable to determine the full extent of its improper payments or to reasonably assure that appropriate actions are taken to reduce them.”
Overpayments are the biggest issue by far, clocking in at $175.1 billion, followed by “unknown payments” at $44.6 billion.
The GAO says last year’s number represents an $11 billion decrease compared to 2022.
The agency has been tracking improper payments for 20 years and says the government has mishandled a staggering $2.7 trillion in payments in that time.
In 2023, 14 agencies reported improper payment estimates across 71 programs, with 79% of estimated improper payments concentrated in five areas:
• HHS’s Medicare, comprising three programs ($51 billion)
• HHS’s Medicaid ($50 billion)
• Department of Labor’s Unemployment Insurance – Federal Pandemic Unemployment Assistance ($44 billion)
• Department of the Treasury’s Earned Income Tax Credit ($22 billion)
• Small Business Administration’s (SBA) Paycheck Protection Program Loan Forgiveness ($19 billion)
You can check out the full report here.
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