Government Spending on Technology: Where Quality Should Be Greater Than Quantity

October 24, 2013

By Kuper Jones

In today’s modern world it is no secret that technology provides incredible advantages. By investing in technology, the doors to greater efficiency and productivity are opened. Unfortunately, this does not appear to be the case for the U.S. government. The government has invested billions in technology over the last decade, but the investments are not generating the results they hoped for. According to a recent Government Accountability Office (GAO) report, the $600 billion in information technology (IT) investments have resulted in little productivity gain, especially when compared to private sector IT investments. The government is investing more than $82 billion a year of taxpayer dollars in technology yet has little to show for it. These spending rates and the lack of results yielded call into question the quality of investments being made, as well as oversight from managing agencies and Congress.

Over a 5 year period (fiscal years 2008-2013), the GAO found $321 million worth of duplicative spending on technology. The most shocking fact regarding that number is that this figure only accounts for three government agencies’ IT budgets –the Department of Health and Human Services (HHS), Department of Homeland Security (DHS), and Department of Defense (DOD). These departments have the largest technology budgets out of all government agencies. GAO defines duplicative investments as when an agency spends money on projects or equipment that essentially serve the same purpose, or have some sort of overlapping functions. For instance, the GAO found that HHS had wasted $260.38 million for six different duplicative investments, four of which were meant to address the same issues. HHS wasted more than the cost of a F-35 fighter jet.

Sadly, the waste doesn’t stop there. Maintenance and servicing equipment is actually one of the most costly IT expenses making up about 69% of the federal IT budget. The best way to reduce maintenance costs is to consolidate so there is less equipment that requires servicing.  Both the GAO and the Office of Management and Budget (OMB) have been offering recommendations to reduce wasteful IT spending for years, but agencies have made little effort to follow them. For example, OMB laid out a plan in 2010 to consolidate federal data centers across multiple federal agencies recommending that 40% of the centers be closed down by the end of 2015 –saving a total of $3 Billion. Despite OMB’s plan, the GAO found that nearly all agencies have yet to complete a data center inventory or other key components necessary for beginning consolidation –meaning many agencies have not even started to think about consolidating. Due to agency non-compliance with the consolidation plan, the GAO has recommended that OMB extend the time frame wasting even more taxpayer dollars.

These are fairly disturbing revelations for the American taxpayer. The opportunity to save a whopping $3 billion is within reach, but OMB and GAO recommendations do not seem to be on any agency priority list.  Instead of strict enforcement, the only reaction this appears to have warranted from OMB is a wag of the finger. If OMB is serious about reducing duplicative investments and wasteful IT spending, they must be more proactive and see that federal agencies are complying with plans.

Instead of offering “recommendations” for reducing duplicative investments and consolidating IT, OMB should offer requirements and hold the non-compliant agencies accountable. These savings don’t come over night, but it has been four years since OMB’s first recommendations and the most costly issues have hardly been addressed by federal agencies. If OMB is unable to demonstrate proactive enforcement of these cost saving plans, Congress needs to take actions that mandate they are followed or face consequences.

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