Obama signs improper payments law
Updated 11:42 a.m. ET
With financial regulatory reform in the bag, President Obama turned to government spending reform on Thursday, signing a bill that requires federal agencies and departments to crack down on improper payments.
The government misspent almost $110 billion in fiscal year 2009 by sending benefits checks sent to dead people, doling out fraudulent Medicare and Medicaid payments and overpaying government contractors.
But the Improper Payments Elimination and Recovery Act that Obama signed requires agencies to spend at least $1 million on audits to identify potential overpayments, produce plans to cut such overpayment errors and sets penalties for agencies that fail to comply.
"It means cutting down on waste, fraud and abuse and ensuring that our government serves as a responsible steward of the tax dollars of the American people," Obama said before signing the bill.
Today's bill signing, combined with Wednesday's signing of a massive financial regulatory reform measure, allows Obama to demonstrate he's putting the government's fiscal house in order while forcing Wall Street to do the same.
The bill, sponsored by Sen. Tom Carper (D-Del.) and Rep. Patrick Murphy (D-Pa.) moved relatively swiftly through Congress and passed unanimously in both chambers.
It's a convenient legislative companion to the Obama administration's efforts to rein in excessive spending and bloated government operations through a series of executive orders and memos that established a "do not pay" list for fraudulent contractors, forced agencies to cut back on building costs and required improvements to the federal hiring process.
"Over the last year or so, we have had both feet on the accelerator in an effort to spur economic growth and job creation," Carper said about the bill. "Now it is the time to take one foot off as our economic recovery begins to take hold and put one foot on the brake to help slow the growth in federal spending. Fortunately, there is still some low-hanging fruit out there, wasteful federal spending."
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| July 22, 2010; 6:15 AM ET
Categories: Contracting, Eye Opener
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