The “Preventing Improper Payments Act” Would Trigger Reporting Requirements for New Federal Funding Programs Making More Than $100 Million in Annual Payments

WASHINGTON, D.C. — U.S. Representatives Abigail Spanberger (D-VA-07) and Blake Moore (R-UT-01) reintroduced bipartisan legislation to prevent the waste, fraud, and abuse of federal funds.

Improper payments — or payments made by the government that should not have been disbursed or were disbursed in the incorrect amount — are of significant concern in certain federal funding programs, including COVID-19 pandemic relief. For Fiscal Year 2021 (FY2021), the U.S. Government Accountability Office (GAO) reported that federal agencies had disbursed an estimated $281 billion in improper payments — an increase of about $75 billion from FY2020. The Preventing Improper Payments Act would create reporting requirements for new federal spending programs and prevent this improper use of funds.

“It is vital to the federal government’s efficacy and long-term fiscal solvency that funds are only going where intended,” said Spanberger. “Congress has the responsibility to create new programs that address specific and timely issues, such as the funding provided to keep small businesses afloat in the wake of the COVID-19 pandemic. But, far too often, we are seeing federal funds ending up in the wrong accounts. The improper payment of federal funds is a long-standing issue. American taxpayers deserve to feel confident that their hard-earned money is not being wasted and that federal dollars are being used only for their approved purpose. I am grateful to my colleague, Congressman Blake Moore, for reintroducing such an important bipartisan bill to cut down on wasteful spending and the abuse of government funds.”

“As our national debt and deficit crises worsen, it is imperative that we ensure federal agencies spend each dollar of taxpayer funds toward its intended purpose,” said Moore. “Congress owes it to the American people to ensure their hard-earned dollars are stewarded responsibly, and I am proud to continue this effort with Congresswoman Spanberger in the 118th Congress.”

The Preventing Improper Payments Act is supported by the National Taxpayers Union (NTU), the Project On Government Oversight (POGO), Taxpayers Protection Alliance (TPA), the R Street Institute, and Americans for Prosperity.

“Improper payments in government programs hurt taxpayers and often hurt the people these programs serve,” said Andrew Lautz, Director of Federal Policy, NTU. “National Taxpayers Union applauds Representatives Blake Moore and Abigail Spanberger for introducing the Preventing Improper Payments Act, which would require more federal programs to report to Congress on their anti-fraud and risk management efforts to actually reduce improper payments.”

“One of the most important responsibilities of a member of Congress – and of the institution as a whole – is to be a good and responsible steward of taxpayer dollars,” said Dylan Hedtler-Gaudette, Government Affairs Manager, POGO. “Oversight mechanisms and guardrails against waste, fraud, and abuse in the spending of those taxpayer dollars are essential to delivering on this responsibility. Rep. Moore and Rep. Spanberger should be applauded for leading the way on this bill and protecting the public from wasted spending via improper payments, which will help ensure that precious public funds can be instead used for vital public investment.”

“The Taxpayers Protection Alliance (TPA) applauds Reps. Blake Moore (R-UT) and Abigail Spanberger (D-VA) for introducing the Preventing Improper Payments Act,” said David Williams, President, TPA. “Estimates show that criminals stole upwards of $80 billion – or 10 percent – of all Paycheck Protection Program (PPP) funds during the pandemic, as well as over $45 billion in unemployment insurance. This legislation takes the necessary steps to ensure effective oversight of public funds. TPA encourages members to join Reps. Spanberger and Moore in protecting federal programs from fraud and abuse.”

“The R Street Institute is pleased to endorse the bipartisan Preventing Improper Payments Act,” said Nan Swift, Resident Fellow, Governance Program, R Street Institute. “Decades of oversight from the Government Accountability Office (GAO) have highlighted that as government spending increases, so too does the risk of improper government payments. GAO recommends that new federal programs that dispense more than $100 million in a fiscal year be designated as susceptible to improper payments. Codifying this recommendation into law is a welcome step, and this preemptive action, along with reinstating expired reporting requirements, will help prevent unnecessary oversight delays and reduce wasteful and fraudulent spending. We urge all Members of Congress to support this legislation.”

Specifically, the Preventing Improper Payments Act would:

• Designate all new federal programs making more than $100 million in payments in any one fiscal year as “susceptible to significant improper payments” for the first three years of operation;

• Subject these programs to more timely improper payment reporting requirements; and

• Reinstate the requirement that agencies report on their antifraud controls and fraud risk management efforts in their annual financial reports to Congress.

Click here to read the full bill text.

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