Today’s hearing will focus on GAO’s third annual report on areas of duplication within the federal government. In its past reports, GAO has made almost 300 recommendations among 131 issue areas to Congress and the Executive Branch to reduce costs and end duplicative, fractured, and overlapping programs. As of today, only 16 of the 131 issues have been fully addressed.

At a time of increased budget pressure, American taxpayers cannot afford to keep buying the same service twice. According to the report: “Collectively, these reports show that, if the actions are implemented, the government could potentially save tens of billions of dollars annually.”

This year’s report also highlights 17 new areas of duplication, fragmentation, or overlap of government programs, and 14 new areas of cost savings.

I am pleased to say that this committee has already been responsive to the GAO’s non-partisan recommendations – several new cost-savings recommendations from GAO would be addressed by the Federal Information Technology Acquisition Reform Act, approved unanimously by this Committee last month.

Today, GAO is launching an online dashboard featuring information about each issue area and the steps taken by agencies to address it. This will allow the American people to hold Congress and the Administration accountable for our efforts on an ongoing basis.

There is one way in which today’s report falls short. However, it is through no fault of the Comptroller General or his excellent staff.

While the report does note that the recommendations would save tens of billions of dollars annually, there is no detailed cost-saving associated with each recommendation.

This is because federal agencies often cannot tell us how much money is spent on a particular program. Federal agencies also lack meaningful performance metrics for its programs. In fact, Federal agencies cannot even provide a simple list of all programs in their own agency.

It is important to reduce duplication wherever possible, and today’s hearing will focus on ways to do that. But we must also focus this Congress on improving the way the federal government collects and produces information so that Congress and the American people can make better informed decisions.

What GAO Found

This 2013 annual report identifies 31 areas where agencies may be able to achieve greater efficiency or effectiveness. Within these 31 areas, we include 17 areas of fragmentation, overlap, or duplication where multiple programs and activities may be creating inefficiencies. Although it may be appropriate for multiple agencies or entities to be involved in the same programmatic or policy area due to the nature or magnitude of the federal effort. The report also includes 14 areas where opportunities exist to achieve cost savings or enhance revenue collections.

To address the issues indentified in these areas, we suggest 81 actions that the executive branch or Congress could take to reduce or eliminate fragmentation, overlap, or duplication or to achieve other financial benefits. Given that the areas identified extend across the government and that we found a range of conditions among these areas, we suggest a similarly wide range of actions for the executive branch and Congress to consider. For example, the actions we suggest in the report include, among many others, canceling a demonstration program, strengthening oversight of certain payments and investments, and limiting or reducing subsidies for a particular program.

The GAO Report

653604

The Letter

April 9, 2013

Congressional Addressees

As the fiscal pressures facing the nation continue, so too does the need for executive branch agencies and Congress to improve the efficiency and effectiveness of government programs and activities. Opportunities to take such action exist in areas where federal programs or activities are fragmented, overlapping, or duplicative. To highlight these challenges and to inform government decision makers on actions that could be taken to address them, GAO is statutorily required to identify and report annually to Congress on federal programs, agencies, offices, and initiatives, either within departments or government-wide, that have duplicative goals or activities¹ In light of today’s challenging fiscal environment, we have also identified additional opportunities to achieve greater efficiency and effectiveness by means of cost savings or enhanced revenue collection.

In March 2011, we issued our first annual report in this series, which presented 80 areas where opportunities existed for executive branch agencies or Congress to reduce fragmentation, overlap, or duplication; achieve cost savings; or enhance revenue² Figure 1 outlines the definitions we use for fragmentation, overlap, and duplication for this work. In February 2012, we issued our second annual report, which identified an additional 51 areas. In these two reports, we have identified a total of approximately 300 actions that executive branch agencies and Congress could take to improve the efficiency and effectiveness of government programs and activities.

Figure 1: Definitions of Fragmentation, Overlap, and Duplication

This third annual report for 2013 identifies an additional 31 areas where agencies may be able to achieve greater efficiency or effectiveness. Within these 31 areas, we identify 81 actions that the executive branch or Congress could take to reduce fragmentation, overlap, or duplication, as well as other cost savings or revenue enhancement opportunities. In addition to identifying new areas, we have continued to monitor the progress executive branch agencies and Congress have made in addressing the areas we previously identified. With the release of this report, we are also concurrently launching GAO’s Action Tracker, a publicly accessible website containing the status of actions suggested in our first three reports. The website will allow executive branch agencies, Congress, and the public to track the progress the government is making in addressing the issues we have identified.

Section I of this report presents 17 new areas in which we found evidence that fragmentation, overlap, or duplication exists among federal programs or activities. Although it may be appropriate for multiple agencies or entities to be involved in the same programmatic or policy area due to the nature or magnitude of the federal effort, the instances of fragmentation, overlap, or duplication we describe in Section I occur in areas where multiple programs and activities may be creating inefficiencies. Section II describes 14 new areas where the federal government may achieve cost savings or enhance revenue collections. This report is based upon work GAO previously conducted in accordance with generally accepted government auditing standards. See appendix II for more information on our scope and methodology.

Opportunities Exist to Improve Efficiency and Effectiveness across the Federal Government

In this report, we first identify 17 areas in which we found evidence of fragmentation, overlap, or duplication among federal programs or activities. These areas cover a broad range of government missions and functions. Section I of this report discusses all of these areas in greater detail.

We consider programs or activities to be fragmented when more than one federal agency (or more than one organization within an agency) is involved in the same broad area of national need and opportunities may exist to improve how the government delivers services. We identified fragmentation in multiple programs we reviewed. For example, we found that the Department of Defense’s (DOD) fragmented approach to developing and acquiring uniforms could be more efficient. Since 2002, the military services have shifted from using two camouflage patterns to seven service-specific camouflage uniforms with varying patterns and colors. Although DOD established a board to help ensure collaboration and DOD-wide integration of clothing and textile activities, we continue to identify inefficiencies in DOD’s uniform acquisition approach. We have identified several actions DOD should take to realize potential efficiencies and up to $82 million in development and acquisition cost savings through increased collaboration among the military services. These actions include directing the Secretaries of the military departments to actively pursue partnerships for the joint development and use of uniforms, as well as identifying and implementing actions necessary to enable the board to develop and issue joint criteria for uniforms prior to the development or acquisition of any new camouflage uniform.

Similarly, we found DOD obligated over $6.8 billion from fiscal years 2008 through 2012 on contracts to acquire a range of foreign language services and products, such as translation and interpretation services. Although DOD has gained some efficiencies by centralizing contracting for certain services under an executive agent, it has not taken steps to comprehensively assess whether additional opportunities exist to gain efficiencies in fragmented contracts for foreign language support, which are estimated to cost more than $1 billion annually. Our prior work has found that agencies, including DOD, reported savings ranging between 5 and 20 percent by implementing more coordinated acquisition approaches rather than fragmented contracting. Given the department’s level of obligations for foreign language support services, DOD could achieve significant cost savings by assessing and addressing the fragmentation in its current approach for managing these contracts.

In some of the programs and activities where there was fragmentation, we also found instances of overlap. Overlap occurs when multiple agencies or programs have similar goals, engage in similar activities or strategies to achieve them, or target similar beneficiaries. We found overlap among federal programs or initiatives in a variety of areas such as joint veterans and defense health care services, export promotion activities, drug abuse prevention and treatment programs, and veterans’ employment and training programs, among others.

For example, within the Department of Homeland Security (DHS), we found six department components involved in research and development activities. We examined 50 research and development contracts awarded by these components and found 35 instances among 29 contracts in which the contracts overlapped with activities conducted elsewhere in the department. Taken together, these 29 contracts were worth about $66 million. An example of the overlap we found: two DHS components awarded five separate contracts that each addressed detection of the same chemical. Moreover, DHS did not have the policies and mechanisms necessary to coordinate or track research and development activities across the department. Without adequate coordination, components may engage in overlapping research and development activities. To prevent such overlap of efforts, we suggested that DHS develop and implement policies and guidance for defining and overseeing research and development.

In other instances we found evidence of duplication, which occurs when two or more agencies or programs are engaged in the same activities or provide the same services to the same beneficiaries. Our 2013 report includes several areas where we identified potentially duplicative federal efforts, such as rural water infrastructure programs. Moreover, in some of these areas—including catfish inspection and geospatial investments—we identified financial benefits that may result if executive branch agencies or Congress took action to address the issues we discuss.

For example, we identified duplication in the Medicaid Integrity Program, which provides federal support and oversight of state programs³ Specifically, we identified duplication in two Medicaid Integrity program activities: (1) the National Medicaid Audit Program, which consists of audits of state Medicaid claims data to identify overpayments, and (2) state program integrity assessments, one of several tools through which the Centers for Medicare & Medicaid Services (CMS) collects data on state program integrity activities. To address this duplication, we suggested that CMS merge certain functions of the federal review and audit contractors and discontinue the annual state program integrity assessment to eliminate or avoid duplicative activities.

In addition to these 17 areas of fragmentation, overlap, and duplication in federal efforts, we present 14 areas in which we identified opportunities for executive branch agencies or Congress to reduce the cost of government operations or enhance revenue collections for the Treasury. For example:

• We report concerns about CMS’s Medicare Advantage Quality Bonus Payment Demonstration, which will cost $8.35 billion over 10 years, most of which will be paid to plans with average performance. Medicare Advantage provides health care coverage through private health plans offered by organizations under contract with CMS. The agency’s stated research goal for the demonstration is to test whether an alternative bonus structure leads to larger and faster annual quality improvement for Medicare Advantage plans. We found that the demonstration’s design precludes a credible evaluation of its effectiveness because it lacks an appropriate comparison group needed to isolate the demonstration’s effects, and because the demonstration’s bonus payments are based largely on plan performance that predates the demonstration. Based on these concerns, we suggest that HHS cancel the Medicare Advantage Quality Bonus Payment Demonstration. In addition, the demonstration’s design raises legal concerns about whether it falls within the Department of Health and Human Services’ (HHS) demonstration authority. Although the demonstration is now in its second year, HHS still has an opportunity to achieve significant cost savings—about $2 billion, based on GAO’s analysis of CMS actuaries’ estimates—if it cancels the demonstration for 2014.
• Additional cost savings and increased revenue collections may be realized by improving the Internal Revenue Service’s (IRS) enforcement of tax laws. IRS has estimated that the net tax gap—the difference between taxes owed and taxes paid on time or recovered—was $385 billion for tax year 2006 (the most recent year for which data were available). To help reduce this gap, in fiscal year 2012, Congress appropriated $7.5 billion to IRS for its enforcement and taxpayer service activities. Notwithstanding IRS’s enforcement and service programs, the net tax gap remains large. To help close this gap, we have identified several areas where IRS can improve its programs, reduce its costs, and facilitate voluntary compliance with existing tax laws. For example, we suggested that IRS should complete a broad strategy, including a timeline and performance measures, for how it intends to use information collected to improve tax compliance. These and other actions we have identified could help the federal government increase revenue collections by billions of dollars.
• As we have previously reported, the net tax gap has been a persistent problem and reducing it will require applying multiple strategies over a sustained period of time⁴ One such strategy is additional information reporting. Taxpayers are much more likely to report their income accurately when the income is also reported to IRS by a third party. By matching information received from third-party payers with what payees report on their tax returns, IRS can detect income underreporting, including the failure to file a tax return. Additionally, taxpayers who rent out real estate are required to report to IRS expense payments for certain services, such as payments for property repairs, only if their rental activity is considered a trade or business. Expanding third-party information reporting on rental real estate service payments and service payments to corporations could increase revenues by an estimated $5.9 billion over 10 years, according to the Joint Committee on Taxation.
• Opportunities may also exist for the Department of Energy (Energy) to generate additional revenue by increasing the price for isotopes that it sells to commercial customers⁵ Energy’s Isotope Development and Production for Research and Applications program (Isotope Program) sells isotopes to commercial customers for a variety of uses, such as medical procedures and radiation detection equipment. To achieve its mission, the Isotope Program relies on annual appropriations and revenues from isotope sales. Although revenues from sales of isotopes alone totaled over $25 million in fiscal year 2012, we found that Energy may be forgoing revenue because it is not using thorough assessments to set prices for commercial isotopes. Thus, we suggested that Energy examine the prices it sets for commercial isotopes to determine if prices can be increased.

Suggested Actions to Achieve Greater Efficiency or Effectiveness in Government

Within these 31 areas, we identified 81 actions that the executive branch and Congress could take to reduce or eliminate fragmentation, overlap, or duplication or achieve other financial benefits. Given that the areas identified extend across the government and that we found a range of conditions among these areas, we suggest a similarly wide range of actions for the executive branch and Congress to consider. For example, the actions we suggest in the report include, among many others, canceling a demonstration program, strengthening oversight of certain payments and investments, and limiting or reducing subsidies for a particular program. Although the actions vary depending on the conditions we found, several themes emerged among our suggested actions, including the following:

• Improving planning: Given the crosscutting policy areas included in this report, planning is an important action in helping federal agencies address challenges, particularly those related to fragmentation, overlap, or duplication. Planning can help federal agencies manage their programs more effectively and guide progress in achieving desired results. For example, we report that a total of 31 federal departments and agencies invest an estimated billions of dollars to collect, maintain, and use geospatial information—information linked to specific geographic locations that supports many government functions, such as maintaining roads and responding to natural disasters. We found that federal agencies had not effectively implemented policies and procedures that would help them to identify and coordinate geospatial data acquisitions across the government. As a result, the agencies make duplicative investments and risk missing opportunities to jointly acquire data. Better planning and coordination among federal agencies could help reduce duplicative investments and provide the opportunity for potential savings of millions of dollars.
• Measuring performance and results: Performance measurement, because of its ongoing nature, can serve as an early warning system to management and a vehicle for improving accountability to the public. To ensure that their performance information will be both useful and used by decision makers, agencies need to consider the differing information needs of various users—including those in Congress. As we have previously reported, agency performance information must meet Congress’s needs for completeness, accuracy, validity, timeliness, and ease of use to be useful for congressional decision making⁶ Similarly, in this report, we find that better evaluation of performance and results is needed for multiple federal programs and activities to help inform decisions about how to address the fragmentation, overlap, or duplication identified. For example, federal agencies could achieve significant cost savings annually by expanding and improving their use of strategic sourcing—a contracting process that moves away from numerous individual procurement actions to a broader aggregated approach. We have reported that a reduction of 1 percent from selected agencies’ procurement spending would equate to over $4 billion in savings⁷ However, a lack of clear guidance on metrics for measuring success has hindered the management of ongoing strategic sourcing efforts across the federal government. By establishing metrics to measure progress toward goals and identifying spending categories most suitable for strategic sourcing, the Office of Management and Budget (OMB) can help federal agencies better implement strategic sourcing practices and maximize their ability to realize billions of dollars in potential savings annually.
• Improving management oversight: When issues span multiple organizations or multiple entities within an organization, improved management oversight is needed to avoid potential overlap and duplication. For example, although OMB guidance calls for agencies to analyze whether their information technology investments are continuing to meet business and customer needs and are contributing to meeting the agency’s strategic goals, we found that agencies did not conduct such an analysis on 52 of the 75 major existing information technology investments we reviewed.⁸ As a result, there is increased potential for these information technology investments in operations and maintenance—totaling $37 billion in fiscal year 2011—to result in waste and duplication. To avoid wasteful or duplicative investments in operations and maintenance, we suggest that agencies analyze all information technology investments annually and report the results of their analyses to OMB. These actions could help agencies achieve cost savings by strengthening the oversight of their existing information technology investments in operations and maintenance, resulting in the potential for billions of dollars in savings.
• Similarly, we found that many states are making Medicaid payments to many providers that are far in excess of those providers’ costs of providing Medicaid services. Specifically, 39 states made payments to certain providers in excess of Medicaid costs by a total of about $2.7 billion. To improve the transparency of and accountability for certain high-risk Medicaid payments, we suggest that Congress consider requiring CMS to take steps that would facilitate the agency’s ability to oversee these payments, including identifying payments that are not used for Medicaid purposes or are otherwise inconsistent with Medicaid payment principles. Such action could lead to cost savings in the hundreds of millions, or even billions, of dollars.
• Enhancing interagency coordination and collaboration: When executive branch agencies carry out activities in a fragmented and uncoordinated way, the resulting patchwork of programs can waste scarce funds, confuse and frustrate program customers, and limit the overall effectiveness of the federal effort. Our report includes several areas in which improved interagency coordination and collaboration could help agencies better leverage limited resources or identify opportunities to operate more efficiently. For example, the Department of Veterans Affairs (VA) and DOD operate two of the nation’s largest health care systems, together providing health care to nearly 16 million veterans, service members, military retirees, and other beneficiaries at estimated costs for fiscal year 2013 of about $53 billion and $49 billion, respectively. As part of their health care efforts, the departments have established collaboration sites—locations where the two departments share health care resources through hundreds of agreements and projects—to deliver care jointly with the aim of improving access, quality, and cost-effectiveness of care. However, we found that the departments do not have a fully developed and formalized process for systematically identifying all opportunities for new or enhanced collaboration, potentially missing opportunities to improve health care access, quality, and costs.
• Considering legislative changes: Although executive branch agencies have authority to implement the majority of the suggested actions, this report includes several areas where legislative changes are needed. For example, we found that when the U.S. Department of Agriculture’s (USDA) Food Safety and Inspection Service begins the catfish inspection program as mandated in the Food, Conservation, and Energy Act of 2008, the program will duplicate work already conducted by the Food and Drug Administration and by the National Marine Fisheries Service. To avoid this duplication, we suggest that Congress repeal the provisions of the act that assigned USDA responsibilities for examining and inspecting catfish and establishing a catfish inspection program. Taking this action could save taxpayers millions annually, according to Food Safety and Inspection Service estimates of the program’s cost.⁹

As another example, we report that unlike many farm programs, the Federal Crop Insurance program, which provides subsidies to pay for part of a farmer’s crop insurance premium, does not have statutory income and payment limits. Congress could achieve up to $1.2 billion per year in cost savings by limiting the subsidy for premiums that an individual farmer can receive each year, reducing the subsidy for all or high-income farmers participating in the program, or some combination of both.

Congress could also consider taking action to help reduce the tens of billions of dollars spent each year developing and launching U.S. government satellite systems. To save money, several federal agencies are actively using or exploring nontraditional approaches to managing their space-based programs, such as developing public-private partnerships and hosting government capabilities on commercial spacecraft.¹⁰ While these approaches hold promise for providing lower-cost access to space in the future, there are also a variety of technical, cultural, logistical, legal, and policy challenges. For example, federal law and policy have limited the government’s access to some hosted payload arrangements where government instruments are placed on commercial satellites, and ride sharing arrangements where multiple satellites share the same launch vehicle. We identify actions that Congress may wish to consider to address these legal challenges and better take advantage of nontraditional approaches.

The Executive Branch and Congress Have Made Some Progress in Addressing the Areas That We Previously Identified

In addition to the new actions identified for this report, we have continued to monitor the progress that the executive branch agencies and Congress have made in addressing the issues we identified in our 2011 and 2012 annual reports. In these reports, we identified approximately 300 actions that the executive branch and Congress could take to reduce or eliminate fragmentation, overlap, or duplication or achieve other potential financial benefits.¹¹

We evaluated progress by determining an “overall assessment” rating for each area and an individual rating for each action within an area (see fig. 2). We found that the executive branch agencies and Congress have made progress in addressing the 131 areas we identified in 2011 and 2012. As of March 6, 2013, the date we completed our audit work, 16 of the 131 areas were addressed; 87 were partially addressed; and 27 were not addressed.¹² We also found that of the approximately 300 actions needed within these areas, 65 were addressed; 149 were partially addressed; and 85 were not addressed.¹³

Figure 2: Assessment of 2011 and 2012 Areas and Actions Needed, as of March 6, 2013

Note: In assessing overall progress for an area, we determined that an area was “addressed” if all actions in that area were addressed; “partially addressed” if at least one action needed in that area showed some progress toward implementation but not all actions were addressed; and “not addressed” if none of the actions needed in that area was addressed or partially addressed.

In assessing actions suggested for Congress, we applied the following criteria: “addressed” means relevant legislation has been enacted and addresses all aspects of the action needed; “partially addressed” means a relevant bill has passed a committee, the House of Representatives, or the Senate, or relevant legislation has been enacted but only addressed part of the action needed; and “not addressed” means a bill may have been introduced but did not pass out of a committee, or no relevant legislation has been introduced. In assessing actions suggested for the executive branch, we applied the following criteria: “addressed” means implementation of the action needed has been completed; “partially addressed” means the action needed is in development, or started but not yet completed; and “not addressed” means the administration, the agencies, or both have made minimal or no progress toward implementing the action needed.

Consolidated areas and actions were not assessed this year due to additional work or other information GAO considered. See appendix II for more information.

An example of the progress made is DOD’s efforts to implement our suggested action related to the area of overseas defense posture. Specifically, in our 2012 annual report, we suggested the Secretary of Defense should direct appropriate organizations within DOD to complete a business case analysis, including an evaluation of alternative courses of action, for the strategic objectives that have to this point driven the decision to implement tour normalization in South Korea—that is, a DOD initiative to transform its defense posture in South Korea. Based on the resulting business case analysis, DOD officials stated that United States Forces Korea determined that the tour normalization initiative was not affordable. This decision not to move forward with the tour normalization initiative resulted in cost avoidance of $3.1 billion from fiscal years 2012 through 2016.

Congress has also taken steps to address some of our suggested actions. For example, in our 2011 annual report, we stated that Congress could reduce revenue losses by more than $5.7 billion annually by addressing duplicative federal efforts directed at increasing domestic ethanol production. To reduce these revenue losses, we suggested that Congress consider whether revisions to the ethanol tax credit were needed and we suggested options to consider, including allowing the volumetric ethanol excise tax credit to expire at the end of 2011. Congress allowed the tax credit to expire at the end of 2011, which ended the ethanol tax credit for fuel blenders that purchase and blend ethanol with gasoline.

Although the executive branch and Congress have made some progress in addressing the issues that we have previously identified, additional steps are needed to address the remaining areas to achieve associated benefits. A number of the issues are difficult to address, and implementing many of the actions identified will take time and sustained leadership. Table 1 outlines selected actions that we reported in 2011 and 2012 that, when addressed, may result in or lead to cost savings or enhanced revenue.

Table 1: Selected Areas with Associated Cost-Savings and Revenue-Enhancement Opportunities in 2011 and 2012 Annual Reports

Source: GAO.

^aAs of March 6, 2013.

Legend:

◐ = Partially addressed, meaning at least one action needed in that area showed some progress toward implementation, but not all actions were addressed.

○ = Not addressed, meaning none of the actions needed in that area were addressed.

To help maintain attention on these issues, as mentioned earlier, we are concurrently releasing GAO’s Action Tracker,, a publicly accessible, online website of the 162 areas and approximately 380 actions needed presented in our 2011, 2012, and 2013 reports. GAO’s Action Tracker, includes progress updates and assessments of legislative and executive branch actions needed. We will add areas and suggested actions identified and future reports to GAO’s Action Tracker, and periodically update the status of all identified areas and activities.

Over 3 Years, GAO Has Identified 162 Areas Where Federal Programs Could Achieve Greater Efficiency or Increase Effectiveness

Our 2013 annual report completes our 3-year systematic examination across the federal government to identify major instances of fragmentation, overlap, or duplication. Through our three annual reports, we have identified a total of 162 areas with actions that the executive branch and Congress could take to address fragmentation, overlap, and duplication or achieve cost savings (see app. III). Collectively, these reports show that, if the actions are implemented, the government could potentially save tens of billions of dollars annually.

These three reports touch on areas in virtually all major federal departments and agencies. Specifically, the reports collectively identify opportunities to reduce fragmentation, overlap, and duplication or achieve other financial benefits within all 15 cabinet-level executive departments and at least 17 other federal entities. Figure 3 illustrates actions needed that we directed to federal departments and agencies in our three annual reports. As the figure shows, we have directed numerous actions to large federal departments and agencies that represent the majority of the federal obligations, including 90 actions directed to DOD, 51 to Treasury, and 44 to HHS, representing 56 percent of fiscal year 2011 obligations.

Figure 3: Actions Needed Directed to Federal Departments and Agencies in 2011-2013 Annual Reports

^aU.S. Postal Service obligations are primarily funded by postal revenues, although the U.S. Postal Service receives minimal appropriations for overseas voting and mail for the blind. Additionally, the U.S. Postal Service has a maximum $15 billion in borrowing authority.

^bTreasury’s percentage of fiscal year 2011 obligations includes interest on the national debt.

Note: Individual actions needed are counted multiple times, when they are directed to more than one federal department or agency.

Our systematic examination required a multiphased approach. First, we reviewed the budget functions of the federal government representing nearly all of the overall federal funds obligated in fiscal year 2010.¹⁴ Because federal budget functions classify budget resources by national need (such as National Defense, Energy, and Agriculture), instances in which multiple federal agencies obligate funds within a particular budget function may indicate potential duplication or cost savings opportunities (see fig. 4 for spending patterns by executive branch agency and budget function). Although this type of analysis cannot answer the question of whether overlap or fragmentation exists—nor indicate whether the overlap identified is duplicative—it can help in the selection of areas for further investigation. Using this information, we identified each instance in which an executive branch or independent agency obligated more than $10 million within these 18 budget functions for further consideration.

Figure 4: Spending Patterns by Executive Branch Agency and Budget Function, Fiscal Year 2010

^aTwo budget functions are not shown above: Allowances, because there are no 2010 actual obligations, and Undistributed Offsetting Receipts, because no obligations are charged to agencies.

Second, we reviewed key agency documents, such as strategic plans, performance and accountability reports, and budget justifications, as we have found that when multiple executive branch agencies have similar missions, goals, or programs, the potential for fragmentation, overlap, or duplication exists. Third, we reviewed key external published sources of information. In particular, we reviewed reports published by the Congressional Budget Office, Inspectors General, and the Congressional Research Service, as well as the President’s budgets, to identify potential overlap and duplication among agency missions, goals, and programs.¹⁵ We relied on our previous work and professional judgment to target areas for further review by considering a variety of factors, including the extent of potential cost savings; opportunities for enhanced program efficiency or effectiveness; the degree to which multiple programs may be fragmented, overlapping, or duplicative; whether issues had been identified by GAO or external sources; and the level of coordination among agency programs.

Based on our multiphased approach, we have identified, to date, 162 areas in which there are opportunities to reduce fragmentation, overlap, or duplication or to achieve cost savings or revenue enhancement. The areas included in our reports, however, do not represent the full extent of our systematic evaluation; we evaluated many additional areas but determined for various reasons that the available evidence did not support their inclusion at this time. The federal inmate reentry grant programs administered by the Departments of Justice, Labor, and Health and Human Services illustrate this point. Although the federal programs are fragmented, we found that overlap is minimal and the risk of duplication is low because the programs vary across eligible applicants, beneficiaries, and primary services. Moreover, the departments have taken steps to coordinate their reentry efforts to prevent duplication and share promising practices.

As another example, we examined the extent to which functions or activities provided under DOD’s civil augmentation programs—which are designed to help meet the military services’ logistics requirements during operations—are potentially fragmented, overlapping, or duplicative. We found no instances of overlap or duplication in the implementation of these programs. Further, we examined the cost or savings implications of consolidating the planning, execution, and oversight of the civil augmentation programs and did not identify clear opportunities to improve the effectiveness or efficiency of the programs.

In still other instances, agencies took steps to address issues we identified during the course of our audit work. For example, through our review of the federal government’s aerostat and airship acquisition efforts, we identified two concurrent and potentially duplicative airship development efforts—one was being developed by the U.S. Army and the other by the U.S. Air Force. However, the potential duplication ended before we issued our report when the Air Force terminated its program due to technical problems experienced with the airframe and the need to avoid the effort’s substantially increasing costs. We were not able to determine any cost savings that resulted from the program’s termination because the Air Force had not budgeted for program costs beyond fiscal year 2012. In addition, in February 2013 the U.S. Army terminated its effort because of schedule delays and increasing costs. The U.S. Army had budgeted approximately $80 million between fiscal years 2013 and 2015 for this effort.

Although our three annual reports provide extensive coverage across the federal government, the areas identified in our annual reports are not intended to represent every instance of fragmentation, overlap, or duplication within the federal government. As statutorily required, we will continue to identify new issues for executive branch agencies and Congress to consider. Likewise, we will continue to monitor developments in the areas we have already identified in this series.

GPRA Modernization Act Can Help Address Challenges in Identifying and Addressing Fragmentation, Overlap, or Duplication

During the past two decades, our work on managing for results has suggested how effective implementation of the Government Performance and Results Act of 1993 (GPRA) could improve collaboration to achieve meaningful results. Congress used our work in crafting the GPRA Modernization Act of 2010 (GPRAMA), which updates GPRA to establish a framework aimed at taking a more crosscutting and integrated approach to focusing on results and improving government performance.¹⁶ Effective implementation of GPRAMA could help clarify desired outcomes, address program performance spanning multiple organizations, and facilitate future actions to reduce fragmentation, overlap, and duplication. Moreover, effective implementation could help address challenges to identifying and addressing the areas of fragmentation, overlap, and duplication we highlight in this series. These challenges include the lack of a comprehensive list of federal programs and funding information and the need for improved and regular performance information. GPRAMA, if effectively implemented, could help address these challenges as well as improve information sharing and coordination among federal agencies—both of which are needed to help address issues of fragmentation, overlap, and duplication.

First, this series highlights challenges associated with the lack of a comprehensive list of federal programs and funding information. A first step in identifying potential fragmentation, overlap, or duplication among federal programs or activities involves creating a comprehensive list of programs along with related funding information. Currently, no comprehensive list exists, nor is there a common definition for what constitutes a federal “program.” The lack of a common definition of program makes it difficult to develop a comprehensive list of all federal programs. The lack of a list, in turn, makes it difficult to determine the scope of the federal government’s involvement in particular areas and, therefore, where action is needed to avoid fragmentation, overlap, or duplication. We also found that federal budget information is often not available or sufficiently reliable to identify the level of funding provided to programs or activities. For example, agencies could not isolate budgetary information for some programs because the data were aggregated at higher levels. Without knowing the full range of programs involved or the cost of implementing them, gauging the magnitude of the federal commitment to a particular area of activity or the extent to which associated federal programs are duplicative is difficult.¹⁷

To help address these challenges, GPRAMA requires the Director of OMB to compile and make publicly available a comprehensive list of all federal programs, and to include the purposes of each program, how it contributes to the agency’s mission, and recent funding information. According to OMB, agencies currently use the term “program” in different ways, and OMB plans to allow them to continue to define programs in ways that reflect their particular facts and circumstances within prescribed guidelines.¹⁸ OMB expects 24 large federal agencies to publish an initial inventory of federal programs by May 2013.¹⁹ In future years, this effort will be expanded to other agencies that will update their inventories annually to reflect the annual budget and appropriations process. OMB also expects to enhance the initial program inventory by collecting related information, such as financing and related agency strategic goals.

Second, this series calls repeated attention to challenges associated with the need for improved and regular performance information. The regular collection and review of performance information, both within and among federal agencies, could help executive branch agencies and Congress determine whether some of the federal programs or initiatives included in this series are making progress toward addressing the identified issues and could determine the actions that need to be taken to improve results. However, as we previously noted, our annual reports highlight several instances in which executive branch agencies do not collect necessary performance data. For example, in our 2011 annual report we noted that OMB has not used its budget and performance review processes to systematically review tax expenditures and promote integrated reviews of related tax and spending programs. Coordinated performance reviews of tax expenditures with related federal spending programs could help policymakers reduce overlap and inconsistencies and direct scarce resources to the most effective or least costly methods to deliver federal support. Similarly, we have previously reported that as Congress oversees federal programs and activities, it needs pertinent and reliable information to adequately assess agencies’ progress, ensure accountability, and understand how individual programs and activities fit within a broader portfolio of federal efforts. The lack of reliable performance data also makes it difficult for decision makers to determine how to address identified fragmentation, overlap, or duplication.

GPRAMA requires that federal agencies regularly collect performance information for federal programs and ensure that it is made publicly available. Specifically, agency leaders are required to conduct quarterly, data-driven reviews of their performance in achieving priority goals and identify strategies to improve performance where goals are not being met. In addition, OMB has directed agencies to take our work in this series into consideration when establishing their budget and management plans. As we recently reported, according to our survey of Performance Improvement Officers in 24 agencies, all 24 agencies were conducting performance reviews at least quarterly as required by GPRAMA.²⁰ While we found the reviews have shown promise in improving internal agency coordination and collaboration, few agency Performance Improvement Officers reported they are using the reviews to coordinate or collaborate with other agencies that have similar goals. We recommended that the Director of OMB identify and share promising practices for including other relevant entities that contribute to achieving their agency performance goals. OMB agreed with our recommendation.

In addition, GPRAMA requires OMB to coordinate with executive branch agencies to establish crosscutting priority goals and to develop a federal government performance plan that defines the level of performance needed to achieve them.²¹ As we reported in May 2012, the President’s 2013 budget submission included the first list of 14 interim crosscutting priority goals.²² For each of the interim goals, as required by GPRAMA, OMB listed the agencies and programs that contribute to the goal in the federal government performance plan. However, based on our prior work, we identified additional agencies and programs that should be included. Accordingly, we recommended that OMB consider adding those additional contributors to the crosscutting priority goals. OMB concurred with this recommendation, and in its December 2012 update to the federal government performance plan, OMB added some of the additional agencies and programs that we identified. GPRAMA also requires agencies to describe how they are working with each other to achieve their strategic and performance goals, as well as any relevant crosscutting priority goals. Moreover, each agency, for each of its performance goals, has to identify the various federal organizations, programs, and activities—both within and external to the agency—that contribute to the goal. These new requirements provide additional opportunities for collaboration across executive branch agencies. We have previously identified key practices that can help federal agencies enhance and sustain their collaborative efforts along with key features to consider as they implement collaborative mechanisms.²³

Furthermore, our work has identified strategies for addressing duplicative government functions and improving efficiency. Efficiency initiatives generally fell within two categories: (1) reexamining programs, structures, and functions to determine whether they effectively and efficiently achieved their mission; and (2) streamlining and consolidating operations to make them more cost effective. To help federal departments implement these initiatives we identified key practices, such as targeting both short-term and long-term efficiency initiatives, that they could use to improve efficiency.²⁴ In addition, we have identified key questions that agencies should consider when evaluating whether to consolidate physical infrastructure or management functions.²⁵

In order for information from performance measurement initiatives to be useful to executive branch agencies and Congress in making decisions, garnering congressional support on what to measure and how to present this information is critical. Thus, GPRAMA significantly enhances requirements for agencies to consult with Congress. Specifically, at least once every two years, OMB is required to consult with relevant committees with broad jurisdiction on crosscutting priority goals, while agencies must consult with their relevant appropriations, authorization, and oversight committees when developing or making adjustments to their strategic plans and agency priority goals. We recently prepared a guide to help ensure that these consultations and the performance information produced by executive branch agencies are useful to Congress in carrying out its various decision-making responsibilities.²⁶

Beyond providing input to OMB and agencies during the consultations to shape their goals, Congress can foster results-oriented cultures in the federal government by using performance information in carrying out its various legislative responsibilities and oversight activities. In addition, in two recent reports we highlighted several instances in which Congress has used performance information in its decision making to (1) identify issues that the federal government should address, (2) measure progress towards addressing those issues, and (3) identify better strategies to address the issues, when necessary.²⁷

Congressional use of agency goals and measured results in its decision making will send an unmistakable message to agencies that Congress considers agency performance a priority. For example, in our 2011 annual report, we noted that the federal government distributed surface transportation funding without regard to performance. However, in July 2012, the Moving Ahead for Progress in the 21st Century Act (MAP-21) was enacted, reauthorizing surface transportation programs through 2014.²⁸ This law identified seven national performance goals for surface transportation and requires the Secretary of Transportation to establish performance measures for them. In addition, states must establish performance targets for those measures and report their progress in achieving them, thereby incorporating accountability for results. Moreover, MAP-21 links funding to performance by requiring states to use federal funds to improve interstate system pavement and bridge conditions to meet minimum standards.

Realizing the intent of GPRAMA for improving government performance and accountability and reducing fragmentation, overlap, and duplication will require sustained oversight of implementation. To assist Congress with this oversight, GPRAMA includes provisions requiring us to review its implementation at several critical junctures. First, following a period of initial implementation, we are to report by June 2013 on implementation of GPRAMA’s planning and reporting requirements, at both the government-wide and agency levels. Subsequently, following full implementation, we are to evaluate by September 2015 and 2017 whether performance management is being used by federal agencies to improve the efficiency and effectiveness of agency programs. Also in September 2015 and 2017—and every 4 years thereafter—we are to evaluate the implementation of the federal government priority goals and performance plans and related reporting required by GPRAMA.

This report was prepared under the coordination of Orice Williams Brown, Managing Director, Financial Markets and Community Investment, who may be reached at (202) 512-8678 or williamso@gao.gov, and A. Nicole Clowers, Director, Financial Markets and Community Investment, who may be reached at (202) 512-8678 or clowersa@gao.gov. Specific questions about individual issues may be directed to the area contact listed at the end of each summary.

Gene L. Dodaro

Comptroller General of the United States

Gene L. Dodaro Testimony:

Dodaro-Testimony