24/7 Wall St. Insights
- We used data from the Office of Management and Budget.
- In its annual improper payments report, the Office of Management and Budget found that federal agencies wasted nearly $785 billion on overpayments in the last five years.
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For some lawmakers, balancing the federal budget and reducing the national debt are top priorities. Proposed austerity measures include cuts to a wide range of federal programs, such as air traffic control, food safety inspections, housing assistance, scientific research, Medicare, and Social Security. Of course, these programs benefit millions of Americans, and their downsizing or elimination would have far-reaching consequences. But cracking down on waste, fraud, and abuse in federally funded programs would be a far more politically palatable alternative to reducing deficit spending.
The U.S. national debt has long been a point of contention in American politics, and recently, it has taken on a renewed urgency on Capitol Hill. Decades of deficit spending have pushed the national debt to $34.6 trillion, double what it was only 10 years ago. Interest payments on the national debt are projected to top $870 billion in fiscal 2024 alone, according to the Congressional Budget Office.
In its annual improper payments report, the Office of Management and Budget found that federal agencies wasted nearly $785 billion on overpayments in the last five years. Simply making accurate payments could have saved taxpayers over $175 billion in fiscal 2023 alone.
Using data from the OMB, 24/7 Wall St. identified the government agencies wasting the most taxpayer money. The 13 federal agencies on this list are ranked by the dollar value of overpayments made in the government’s 2023 fiscal year. All supplemental data in this story also came from the OMB report. Among these agencies, overpayments range from about $16 million to nearly $99 billion.
Why Is This Important?
While some of this money is recoverable, taxpayers are ultimately on the hook for much of that wasted spending. The agencies on this list recovered a reported $25.2 billion in improperly made payments in fiscal 2023, some share of which was paid in error in a previous year. Still, this amounts to only about 14% of the total overpayments made in 2023.
Notably, government agencies themselves are not always directly responsible for overpayments. In seven of the 13 agencies on this list, 50% or more of the total value of overpayments in the last fiscal year were determined to have been outside of agency control. A small share of these cases are attributable to fraud.
These are the government agencies wasting the most taxpayer money.
13. Corporation for National and Community Service
- Overpayments made in fiscal 2023: $16.0 million (4.2% of agency spending)
- Responsibility for overpayments in fiscal 2023: 100% outside of agency control
- Overpayments recovered in fiscal 2023: $220,000
- Total agency spending in fiscal 2023: $383.4 million
- Sub-agencies/programs overspending in fiscal 2023 include: AmeriCorps, Foster Grandparent Program, Senior Companion Program
12. Federal Communications Commission
- Overpayments made in fiscal 2023: $85.1 million (1.5% of agency spending)
- Responsibility for overpayments in fiscal 2023: 18.5% within agency control; 81.5% outside of agency control
- Overpayments recovered in fiscal 2023: $85.1 million
- Total agency spending in fiscal 2023: $5.6 billion
- Sub-agencies/programs overspending in fiscal 2023 include: Universal Service Fund
11. Department of Defense
- Overpayments made in fiscal 2023: $202.5 million (0.03% of agency spending)
- Responsibility for overpayments in fiscal 2023: 99.9% within agency control; 0.1% outside of agency control
- Overpayments recovered in fiscal 2023: $1.7 billion
- Total agency spending in fiscal 2023: $621.2 billion
- Sub-agencies/programs overspending in fiscal 2023 include: Military and civilian payroll, military retirement, travel pay
10. Office of Personnel Management
- Overpayments made in fiscal 2023: $224.3 million (0.2% of agency spending)
- Responsibility for overpayments in fiscal 2023: 100% within agency control
- Overpayments recovered in fiscal 2023: $232.2 million
- Total agency spending in fiscal 2023: $95.3 billion
- Sub-agencies/programs overspending in fiscal 2023 include: Federal Retirement Services
9. Department of Education
- Overpayments made in fiscal 2023: $471.9 million (0.2% of agency spending)
- Responsibility for overpayments in fiscal 2023: 80.9% within agency control; 19.1% outside of agency control
- Overpayments recovered in fiscal 2023: $215.3 million
- Total agency spending in fiscal 2023: $221.6 billion
- Sub-agencies/programs overspending in fiscal 2023 include: Federal Pell Grant Program, Title I grants, special education grants
8. Department of Transportation
- Overpayments made in fiscal 2023: $526.9 million (0.7% of agency spending)
- Responsibility for overpayments in fiscal 2023: 100% outside of agency control
- Overpayments recovered in fiscal 2023: $11.0 million
- Total agency spending in fiscal 2023: $75.5 billion
- Sub-agencies/programs overspending in fiscal 2023 include: Federal Transit Administration, Federal Highway Administration
7. Department of Veterans Affairs
- Overpayments made in fiscal 2023: $1.8 billion (5.0% of agency spending)
- Responsibility for overpayments in fiscal 2023: 96.9% within agency control; 3.1% outside of agency control
- Overpayments recovered in fiscal 2023: $642.2 million
- Total agency spending in fiscal 2023: $36.0 billion
- Sub-agencies/programs overspending in fiscal 2023 include: Community Care, pensions, medical contracts
6. Small Business Administration
- Overpayments made in fiscal 2023: $3.6 billion (2.9% of agency spending)
- Responsibility for overpayments in fiscal 2023: 100% within agency controlOverpayments recovered in fiscal 2023: $2.2 million
- Total agency spending in fiscal 2023: $122.5 billion
- Sub-agencies/programs overspending in fiscal 2023 include: Paycheck Protection Loan Program, disaster assistance loans
5. Department of Agriculture
- Overpayments made in fiscal 2023: $8.5 billion (6.6% of agency spending)
- Responsibility for overpayments in fiscal 2023: 4.1% within agency control; 95.9% outside of agency control
- Overpayments recovered in fiscal 2023: $550.9 million
- Total agency spending in fiscal 2023: $128.2 billion
- Sub-agencies/programs overspending in fiscal 2023 include: Risk Management Agency, Commodity Credit Corporation, Food and Nutrition Service
4. Social Security Administration
- Overpayments made in fiscal 2023: $11.1 billion (0.8% of agency spending)
- Responsibility for overpayments in fiscal 2023: 17.1% within agency control; 82.9% outside of agency control
- Overpayments recovered in fiscal 2023: $4.9 billion
- Total agency spending in fiscal 2023: $1.3 trillion
- Sub-agencies/programs overspending in fiscal 2023 include: Supplemental Security Income, Old-Age, Survivors, and Disability Insurance
3. Department of Labor
- Overpayments made in fiscal 2023: $24.7 billion (16.2% of agency spending)
- Responsibility for overpayments in fiscal 2023: 87.3% within agency control; 12.7% outside of agency control
- Overpayments recovered in fiscal 2023: $997.3 million
- Total agency spending in fiscal 2023: $152.6 billion
- Sub-agencies/programs overspending in fiscal 2023 include: Employment and Training Administration, Office of Workers’ Compensation
2. Treasury Department
- Overpayments made in fiscal 2023: $25.0 billion (32.1% of agency spending)
- Responsibility for overpayments in fiscal 2023: 100% outside of agency control
- Overpayments recovered in fiscal 2023: $59.2 million
- Total agency spending in fiscal 2023: $78.0 billion
- Sub-agencies/programs overspending in fiscal 2023 include: Earned Income Tax Credit, Additional Child Tax Credit, American Opportunity Tax Credit
1. Department of Health and Human Services
- Overpayments made in fiscal 2023: $98.7 billion (6.6% of agency spending)
- Responsibility for overpayments in fiscal 2023: 0.3% within agency control; 99.7% outside of agency control
- Overpayments recovered in fiscal 2023: $15.8 billion
- Total agency spending in fiscal 2023: $1.5 trillion
- Sub-agencies/programs overspending in fiscal 2023 include: Centers for Medicare and Medicaid Services, Health Resources and Services Administration, Administration for Children and Families
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