OMB and the council of agency inspectors general overseeing spending under the various pandemic relief laws that have been enacted over the last year have posted an alert about “payment integrity” risks associated with such special appropriations and listing steps to mitigate those risks.
Laws including the recently enacted $1.9 trillion American Rescue Plan authorized additional spending of some $5 trillion and “it is imperative that executive departments and agencies incorporate in program design, tracking, and reporting lessons learned and mitigating strategies to risks and issues with payment integrity encountered during previous rounds of COVID-19 stimulus,” says a notice on cfo.gov.
“Increased attention should be paid to the potential for payment-integrity risks associated with the creation of a federal program, including familiarity with new processes for disbursing program funds and with fully understanding and interpreting new program authorities, practices, and procedures, as well as expected recipient behavior in response to new program benefits,” it says.
Considerations include the potential need to change program policies and procedures; changes to eligibility rules; errors arising from the imperative to get funds distributed quickly; and “increases in the volume of applications and awards, addition of program functions, or even an increase in temporary staff less familiar with internal control processes,” it said.
Mitigation strategies it listed involve improving access to and leveraging data; additional tracking of funding; coordination with agency IGs; designation of accountable officials; and strategies such as “increased automation that limits errors, behavioral interventions that aim to deter dishonesty, and internal process or policy changes, such as random audits.”