Federal Improper Payments Are Significant, Costing Taxpayers Billions
Introduction
The federal government makes payments in the wrong amount, to the wrong people, and for the wrong reason every year. These incorrect payments are called “improper payments” and they cost taxpayers hundreds of billions of dollars annually. Current efforts to prevent and recover these payments are lacking, and the parties involved face major barriers in effectively fixing this problem. The Project On Government Oversight is producing a series of reports to illuminate the realm of improper payments, ultimately hoping to provide recommendations to the executive branch on how to improve the identification, prevention, and recovery processes.
This first report describes the U.S. federal government’s concept of improper payments, and highlights their significance, their causes, and the barriers preventing their effective prevention and recovery. It is in response to the Government Accountability Office’s (GAO) October 2015 report titled Addressing Improper Payments and the Tax Gap Would Improve the Government’s Fiscal Position. While the GAO report provides some valuable information, it does not provide a complete view of the situation. Most public information on improper payments is incomplete, out-of-date, inconsistent, or lacking in some other way. Additionally, there are indications that some agencies are not properly identifying or reporting their improper payments, making any comparisons between the numbers necessarily suspect and limited in usefulness. This report hopes to provide an introduction to this topic for newcomers and to translate the information provided by the federal government and other sources into a more easily digestible form.