Friday, November 19, 2010
The White House insists the news is good for the government’s efforts to stem wasteful spending, even though the numbers would indicate otherwise.
During fiscal year 2010, the rate of improper payments—checks sent in error, disbursed to the wrong person, or obtained through fraud—declined to 5.49%, from 5.65% in 2009, according to the Office of Management and Budget (OMB). Officials insisted the .16% drop represented a savings of $3.8 billion in avoided erroneous payments.
But at the same time, OMB admitted that the total value of improper payments actually increased from FY2009 to FY2010, from $110 billion to $125 billion. The office blamed the economic downturn for the rise, saying the bad times created a higher demand for unemployment insurance and Medicaid benefits.
“This is an unfortunate result of the recession and of basic math: the more that is paid out, the more paid out in error, even if the overall rate declines,” OMB interim Director Jeffrey Zients blogged this week.
The Obama administration’s goal is to reduce improper payments by $50 billion by September 30, 2012.
-Noel Brinkerhoff
Agencies Chip away at Improper Payments (by Robert Brodsky, Government Executive)
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