The Department of Veterans Affairs has not updated some of its purchasing regulations since 2008, and the resulting problems created for contracting officers at the agency have caused the Government Accountability Office to designate the problem a high-risk area for 2019.
“The VA acquisition is a huge part of the mission over at the Department of Veterans Affairs. They do about $26 billion in procurements each year, and tens of thousands of procurement actions. Since 2015, we’ve had over 31 recommendations that we’ve done there and, unfortunately, 21 of those remain open, and so the high-risk designation centers on a couple of longstanding weaknesses that they’ve had in the acquisition area,” said Chris Mihm, managing director of the GAO Strategic Issues Team, in an agency podcast.
“First is that they don't have a consistent and coordinated set of policies and regulations across the department. Second is that there is the importance of just a human capital, to make sure that their people are trained, to make sure that their workloads are being appropriately managed. Third, there's problems that we've seen in terms of data and transparency over the acquisition process. And then fourth, that we're very concerned about the absence of a strategic approach to procurement at the department.”
Acquisition at the VA came under particular scrutiny after the agency announced that it would be following the Department of Defense’s lead in pursuing an electronic health record system at a cost of $10 billion over 10 years.
The GAO “High-Risk List” is published every two years to give the newly elected Congress a sense of the most pressing issues facing the federal government.
“Over time, the High-Risk List has yielded incredible financial benefits," said Mihm. "Just in the last 13 years alone, $350 billion in financial benefits has accrued from action to address high-risk issues, so that’s about $27 billion a year and last year, 2018 was the peak year for that, about $47 billion in financial benefits through action on high-risk areas.”
In addition to VA acquisition, GAO added the federal security clearance process as a quasi-new component of the list, as they had already made a special off-season announcement of its addition in January 2018.
“Unfortunately, they've had some real problems recently in areas such as the timeliness of security clearances, having good quality performance measures in place, and then IT security remains a major concern on this,” said Mihm.
“We have 19 open recommendations to various agencies that are responsible for the security clearance process. We think action on those could go an awful long way to addressing the high-risk areas.”
This is not the first time security clearances have been featured on the list, as the process was also designated high risk from 2005 to 2011.
In total, the GAO High-Risk List featured 35 areas of concern, with seven areas improving, three regressing, two showing mixed progress and the rest remaining largely the same.
GAO chose to remove two areas from the list — DoD Supply Chain Management and Mitigating Gaps in Weather Satellite Data — due to their improved ratings.
According to Mihm, DoD Supply Chain Management was one of the items on the first High-Risk List, making it especially significant that it “graduated” off the 2019 list.
“The bottom line is that persistent action to address high-risk issues pays off. That's the story that happened with, earlier, on personnel security clearances, that's what happened, certainly, with DOD supply chain management and weather satellites,” said Mihm.
“On the other hand, without that persistent leadership, without looking at making sure that you have capacity and an action plan and that you’re monitoring the implementation of that action plan, you can backslide.”