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Dr. Coburn Holds Hearing Exposing Vast Waste from Improper Payments

Location: Washington, DC

Dr. Coburn Holds Hearing Exposing Vast Waste from Improper Payments

Says GAO has found only "the tip of the iceberg"

U.S. Senator Tom Coburn, M.D. (R-OK), Chairman of the Senate Homeland Security and Governmental Affairs Subcommittee on Federal Financial Management, today held a hearing on improper payments in the federal government. A recent Government Accountability Office (GAO) study estimated that improper federal payments, which mostly consist of overpayments, consume at least four cents of every federal tax dollar.

"At a time when our nation is fighting a war, facing mounting deficits and struggling to shore up Medicare and Social Security it is unconscionable for the federal government to waste countless billions of dollars," Dr. Coburn said. "Improper payments can be eliminated almost entirely by practicing well-established accounting practices that are relatively easy to implement."

"It is ironic that many politicians and bureaucrats in Washington believe they are entitled to police ‘corporate America' but are themselves guilty of Enron-style mismanagement on a massive scale," Dr. Coburn added. "Any private company that had a rate of improper payments close to the federal governments' rate would be run out of business and face possible criminal prosecution."

According to a report by the GAO, 17 federal agencies reported $45 billion in improper payments. Twelve other agencies did not even file a report. Future estimates of improper payments are likely to trend higher, according to the GAO, because many federal programs have not been examined.

"The improper payments we know about are only the tip of the iceberg. The federal government may squander five cents per dollar or $125 billion per year because agencies and members of Congress lack the political will and discipline to spend wisely," Dr. Coburn said.

"We are also setting a terrible example for the emerging democracies we want to encourage," Dr. Coburn added. "We waste more money every year through improper payments than many developing nations produce throughout their entire economies. That is a national and international embarrassment."

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