Obama Pushes Forward on Do Not Pay Initiative

January 14, 2013 | By Jerry Ashworth | Post a Comment

There may be many other pressing concerns — the federal debt, gun control, foreign wars, to name a few — but President Obama has ensured that reducing federal government improper payments remains high on his agenda.

The White House last week signed the Improper Payments Elimination and Recovery Improvement Act of 2012 (H.R. 4053), which requires the Office of Management and Budget to:

  • identify, annually, a list of high-priority federal programs for greater levels of oversight and review in which the highest dollar value or highest rate of improper payments occur or for which there is a higher risk of improper payments;
  • coordinate with agencies responsible for administering high-priority programs to establish annual targets and semi-annual or quarterly actions for reducing improper payments; and
  • provide guidance to agencies for improving estimates of improper payments.

The law also requires federal agencies to report annually to their Inspectors General on any high-dollar improper payments identified and requires OMB to make such reports available to the public on a central website.

The law requires federal agencies to review prepayment and preaward procedures and available databases to determine program or award eligibility and prevent improper payments before releasing any federal funds. The new law also establishes the Do Not Pay Initiative, which allows agencies to use these databases to prevent improper payments. OMB is directed to report annually on the progress of the initiative in reducing improper payments or awards, as well as address the identification of incorrect database information.

Under the Do Not Pay Initiative, OMB is required to establish a system for prepayment and preaward review. By June 1, each federal agency must review all of its payments and program awards using the system.

The new law includes other various provisions. They are worth checking out. Personally, I’m glad to see Congress could reach some bipartisan agreement on this issue and get it out the door as quickly as it did.

OMB and the agencies have a lot of work to do this year to put this initiative into action. If you combine the work required on this initiative with OMB’s long-delayed proposed rule grant reform, these next few month look to be a busy time at OMB.

Let us know what you think about this initiative.


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