Federal Manager's Daily Report

OMB has said that the government-wide improper payment rate rose from 5.6 to 7.2 percent in fiscal 2021 over 2020, saying the increase “was largely driven” by an increase in the unemployment insurance program, a joint federal-state government initiative.

Improper payments in that program were 18.7 percent, 5-8 percentage points higher than during a normal, non-pandemic 12-month period, OMB said in a blog posting. “As the pandemic took hold in 2020, it triggered a massive surge in UI claims that overwhelmed state-run agencies responsible for administering unemployment insurance” beyond the capacity of controls meant to stop fraud and to assure payments are correct.

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“And, we know that problems accumulated from early in the pandemic are still being discovered and will take a long time to clean up,” it added.

Improper payments are a long-running concern for OMB, GAO, agency IG offices, and Congress, although the OMB noted that by the government’s definition, “improper” does not necessarily mean fraudulent or even excessive, but also incorrect or insufficiently documented.

OMB cited recent initiatives including updating its payment integrity guidance “to help agencies spend less time on low-value compliance and more time building capacity to help prevent improper payments with a focus on those resulting in monetary loss” and guidance stressing cooperation with IG offices.

Figures by agency are at paymentaccuracy.gov.

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