Defense Department Spending Watchdog Lacks Bite

Statement

The Defense Department's audits for waste, fraud, and abuse don't make the grade. That's a problem at an agency that spends $700 billion tax dollars a year.

Every federal agency has an inspector general whose job is to audit agency spending to ensure that tax money is spent as intended, in a way that gets the most bang for the taxpayers' buck. The Defense Department is notorious for spending with a free hand. I got involved in Pentagon oversight in the 1980s, when several of us uncovered $750 toilet seats and $695 ashtrays for military aircraft. Those excesses gave rise to whistleblower incentives to encourage people to blow the whistle on fraud against the taxpayers. Those provisions, which I wrote in the Senate, have recovered more than $28 billion and deterred billions of dollars in additional fraud against the taxpayers since their enactment in 1986.

Inspectors general serve as another critical check on spending. They have professional staff and resources and operate alongside, but independent from, each agency. The way the office is designed, the Defense Department inspector general should audit spending like a junkyard dog.

Instead, the inspector general audits have as much bite as a toothless puppy. This is the conclusion of a report I released this week. The report came after I directed my staff to review all 113 unclassified Defense Department inspector general audits for Fiscal Year 2010. Under our analysis, 15 reports are "good to very good." But the rest of the reports earn negative assessments for failing to track the tax dollars, losing the money trail, taking too long to complete and at the very worst, being pointless or just rehashing old reports. Some reports took so long to complete and were so stale that the money was long spent, the people who spent it were long gone, and any attempt to get it back would be futile. As a result of these failures, the report assigns a D- grade overall to the 113 audits.

The inspector general says he's committed to improvement, and there are glimmers of hope that he's headed in the right direction. My report names nine audit roadblocks that stand in the way of improving audit quality. The inspector general has to find a way to tear down these walls. Otherwise, audit reform and transformation will never happen. My staff and I will keep reading and evaluating inspector general audits until steady improvement is popping up on the radar screen every day.

Audits are the tip of the inspector general's spear. A good spear always needs a finely honed cutting edge. Right now, the point of that spear is dull. The best audit weapon is disabled. Degraded audit capability puts the taxpayers' money in harm's way. It leaves huge sums of money vulnerable to theft and waste. Inspectors general are an asset to taxpayers when they perform well. With taxpayers' money on the line, these watchdogs have to perform at the very highest levels every day.

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