New law tries to curb $125B in improper federal spending

New legislation cracking down on fraudulent and improper payments gives agencies more requirements and oversight in an attempt to save the government hundreds of billions of dollars a year.

The Improper Payments Coordination Act of 2015 — co-sponsored by Sens. Tom Carper, D-Del., and Ron Johnson, R-Wisc. — builds upon previous measures enacted in 2010 and 2013 by requiring agencies to use and share data to ensure federal dollars are being allocated correctly.

The bill passed the Senate Tuesday by unanimous consent.

Bill: Improper Payments Coordination Act

The legislation expands use of the Do Not Pay initiative, as well as increasing data sharing — specifically around informing agencies of the death of a beneficiary — and the use of analytics to discover and recover improper payments.

The law also requires the Treasury Department to report to Congress on the agency-by-agency use of analytics within 180 days of enactment.

Carper cited statistics from the Office of Management and Budget that show agencies made some $125 billion in improper payments in 2014 alone.

More: Improper payment rate falls in 2013, but trouble persists

That figure is $19 billion more than recorded in 2013, Johnson pointed out.

"Despite increased attention to the problem, the federal government's efforts to stop improper payments have not been successful," he said. "Taxpayers expect the federal government to ensure that it is paying the right people in the right amount for the right reason … Incremental improvements such as this are necessary if we are to reduce the $125 billion that was wasted last year."

A similar bill passed a committee vote in the House last week.

More: How agencies can get a leg up in stopping improper payments

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