From the U.S. Government Accountability Office, www.gao.gov

Transcript for: US Comptroller General Gene Dodaro: Senate Testimony on
Oversight of Emergency Relief Funds

Description: In his March 17, 2022 testimony to the U.S. Senate
Committee on Homeland Security and Government Affairs, US Comptroller
Gene Dodaro testified on the need for effective oversight of COVID and
other emergency relief funding.

Related GAO Works: GAO-22-105715, Emergency Relief Funds: Significant
Improvements Are Needed to Ensure Transparency and Accountability for
COVID-19 and Beyond

Released: March 2022

[ Gene Dodaro : ] 
Thank you very much, Mr. Chairman, Ranking Member Portman, members of
the committee. Very pleased to be here to talk about our work on COVID
19 relief spending, as has been mentioned. Great urgency was given to
providing quick relief to deal with public health issues and economic
repercussions of the pandemic. However, trade offs were made at limited
progress in ensuring transparency and accountability over this money
controls that should have been in place before payments were made were
either reduced or eliminated Also, monitoring efforts, post payment
reviews and other efforts weren't instituted as fast as possible.

After the payments were made to try to assess the integrity of the
programs and have recovery efforts underway now, these shortcomings were
exacerbated by already existing problems in financial management in the
federal government. Chief among these is a serious, improper payment
problem. The government has got a payment problem and lack of focus on
prevention of audits, not after the fact paying chase with regard to
improper payments.

Since 2003 reported estimates total over $2.2 trillion just in fiscal 21
alone was $281 billion a jump from 75 billion in the prior year. This
involves 16 agencies 86 federal programs 26 or 30% of them have an over
10% improper payment rate also and this is an incomplete estimate. Some
are not reporting some of the estimates aren't rigorous with regard to
the fraud prevention issue.

We work with the Congress in 2016 to help Congress pass fraud Prevention
Act that was supposed to have agencies focus more on preventing fraud.
This was slow to be implemented therefore we weren't in a good position
when the emergency pandemic came around to prevent the fraud that
occurred. So we are recommending today ten different legislative
solutions that Congress could pursue to address both what we found
during the pandemic and these underlying persistent serious fundamental
financial management issues that the government has.

No one. Chief financial officers ought to be given more responsibility
for improper payments estimates to certify their accuracy, to monitor
corrective actions. Right now it's just the program. People who
administered programs that are providing the estimates. So we need more
rigor and estimates, more transparency and corrective action plans. They
ought to be mandated to be reported and agency financial statements
every year.

And and any new program, in my opinion, over $100 million ought to be
automatically determined to be susceptible to improper payments. There
should have to be prove it's low risk or not prove that there's a
problem. And this would ensure improper payment estimates are made in
the first year of the program. Right now, it's two or three years down
the road before these estimates are made and problems are already
entrenched into the program activities.

Secondly, with regard to fraud, we need to reinstitute the reporting
requirements that the agencies have to report on the status of their
fraud prevention efforts. This would provide better visibility and more
assertive congressional oversight over their efforts, because only if
these agency officials can prevent fraud is the most meaningful way that
this could be addressed. And also, I believe that the what's now called
the PACE Committee ought to be permanently instituted and focused on all
federal spending not just COVID spending.

I recommended this back in 2015 after the Recovery Act. Unfortunately,
Congress and the administration didn't follow that. And so this effort
was put in place was too late. Was a year after the efforts was only
limited to the pandemic. So that could be fixed. Also, internal control
plans ought to be put in place immediately for emergencies. So there are
already in place.

We know what the problems are. They could be tailored later if it's a
unique need for the emergency, but they ought to be put in place. Normal
controls is not sufficient as we've seen here on OMB should do this.
Congress should mandate that it be done. Also, we need to reinstitute
the requirement for the inspector general to audit periodic tally of
federal spending that's displayed through USASpending.gov. 

So I have other suggestions, but my time's up. I'm happy to answer
questions at the appropriate time. I appreciate the invitation to
participate today. Thank you.

[ End. ]