CAGW: VA Scandal Demands Scrutiny, Revamp of All Agency Bonuses

WASHINGTON--()--Today, Citizens Against Government Waste (CAGW) called for a total reevaluation of the federal employee bonus system after revelations that dozens of officials at multiple Veterans’ Administration (VA) medical facilities under investigation by the VA’s Office of Inspector General (OIG) received millions in bonuses while the facilities were under scrutiny.

“The federal bonus system is an inscrutable, unaccountable black box,” said CAGW President Tom Schatz. “The unfolding scandal at the VA is currently and correctly focused on the immediate plight of our wounded servicemen and women and allegations of data manipulation by VA officials. But reports that officials under investigation might have received cash bonuses while their activities were under investigation for these transgressions add insult to injury and, once again, calls into question the credibility of the entire federal bonus system.”

The VA bonuses are just the latest in a relentless stream of stories about questionable federal employee awards. According to the Treasury Inspector General for Tax Administration, in fiscal year (FY) 2011, the Internal Revenue Service (IRS), deeply embroiled in its own controversy, handed out almost $92 million in cash (along with 520,000 hours of time off) to 70,500 of its approximately 104,400 employees. For FY 2012, the IRS awarded $86 million in cash and almost 490,000 hours of time off to 67,870 of its approximately 98,000 employees. Yet, between October 1, 2010 and December 31, 2012, more than 2,800 IRS employees with “substantiated conduct issues resulting in disciplinary action” got more than $2.8 million in monetary awards; 1,100 of those employees had confirmed federal tax compliance problems and yet received more than $1 million in cash awards.

In 2012, an Environmental Protection Agency official was convicted of scamming the agency out of $900,000 in pay and bonuses to which he was not entitled, even after suspicions surfaced about his conduct and eligibility in 2008.

After news reports surfaced that employees at the General Services Administration (GSA) had spent excessively on conferences and events, the agency’s OIG revealed that GSA officials issued bonuses to employees based on bogus criteria, such as managing “terrific and productive meetings.” The GSA OIG stated that the bonuses “illustrate a willingness by the GSA to violate legal requirements that resulted in an opaque evaluation and award system.”

The bonus bonanza led the Office of Management and Budget (OMB) to issue guidelines directing agencies to exercise constraint on the issuance of federal bonuses for FY 2014, including the following: “Given the current fiscal environment and the budget constraints agencies will operate under in FY 2014, it is critical that agencies’ use of performance awards be managed in a manner that is cost-effective and leads to increased employee performance and organizational results.” News reports indicate that the money spent on federal employee performance awards has dropped from $332 million in FY 2012 to $176.6 million in FY 2013.

“Calls for restraint always seem to emerge immediately after another financial scandal or controversy,” said Schatz. “This pattern of widespread, serious, and chronic mismanagement related to the distribution of cash awards to federal employees demands a thoughtful, thorough, and transparent congressional review of the whole bonus system. Taxpayers have virtually no sightline into the contractual obligations that agency officials have entered into with federal employee unions and they have no clue about the criteria and performance benchmarks for making awards, even though hundreds of millions of dollars are at stake. It is long past time for Congress to fully vet the federal bonus system, provide chapter and verse on how much the government spends, and reveal how all bonus decisions are made within each agency. Given the gross waste, fraud, and abuse evident within the federal bonus system itself, it is a good bet that making the government run more efficiently is probably not one of the criteria used to determine awards,” concluded Schatz.

Citizens Against Government Waste is the nation’s largest taxpayer watchdog dedicated to eliminating, waste, fraud, and abuse in government.

Contacts

Citizens Against Government Waste (CAGW)
Alexandra Booze, 202-467-5318
or
Leslie K. Paige, 202-467-5300

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Contacts

Citizens Against Government Waste (CAGW)
Alexandra Booze, 202-467-5318
or
Leslie K. Paige, 202-467-5300