In fiscal year (FY) 2010, the federal government disbursed a little more than $125 billion in improper payments to the public, up from roughly $110 billion in FY 2009. Though total improper payment dollars have increased, the federal government is getting better at preventing these wasteful disbursements. Indeed, most federal agencies are only now finalizing implementation of the Obama administration's improper payments reduction effort, which began in late 2009.

Improper payments occur when the government sends a check to the wrong person, sends the wrong amount of money to the right person, or sends the right amount of money to the right person but that person ends up using the funds in an improper manner.

The administration took its first crack at addressing improper payments in November 2009 with an executive order (E.O.), attempting to increase transparency and provide agencies with better incentives and more accountability to help the government get a better handle on the scope of the problem. The initiative built on reforms started in 2002 that required federal agencies to account for the root causes of payment errors in programs susceptible to significant improper payments.

The E.O., along with guidance released in March 2010 directing federal agencies how to implement the new plan, called for "several new public disclosure requirements" that would increase the accountability of federal agencies for any lack of progress on reducing improper payments.

One result of the E.O. and guidance has been the Payment Accuracy website. Similar to other accountability-based, data-driven Obama administration websites, like the IT Dashboard and Recovery.gov, Payment Accuracy provides the public with a one-stop shop for information on the federal government's efforts to reduce improper payments.

One of the interesting aspects of the Payment Accuracy website is the inclusion of the names of two individuals at the program and agency levels chosen to be accountable for each of the 14 current high-error programs, meaning those that reported roughly $750 million or more in improper payments in 2009. This mirrors the Obama administration’s effort to increase accountability by publishing the identities of a program's senior accountable officials through its IT Dashboard. Some, however, have questioned whether these efforts are enough to increase accountability within Washington's notoriously impenetrable layers of bureaucracy.

Publishing the names of those accountable for high-risk programs is a requirement enacted under the Improper Payments Elimination and Recovery Act (IPERA), passed by Congress in July 2010. According to an official at the Government Accountability Office (GAO), "There are some attractive 'carrots' for agencies included in" IPERA:

For example, agencies can use up to 25 percent of recovered funds for improving financial management; up to 25 percent for the program or fund linked to the overpayment; and up to 5 percent for inspector general activities. So, agencies can keep as much as 55 percent of the recaptured money, and the rest is returned to the general treasury.

With debates heating up in Congress over government spending, improper payments may play an outsized role in future budget negotiations. Indeed, GAO highlighted the federal government's proclivity to send checks to the wrong people in its recent and hugely popular report on duplicative programs.

Conservatives have picked up the improper payments issue, just like other similar potential savings in government, as a reason why Congress needs to reduce government spending. They tend to question why Congress should lavish the federal government with further funds when it already wastes over $100 billion. But this argument misses the point that many of these agencies need money to implement the administration's anti-fraud measures like fighting improper payments.

One of GAO's recommendations is for the administration to continue pushing its initiative, which shows that the watchdog understands the importance of breaking through the federal government's bureaucracy to enact real change.

That breakthrough will require Congress to fully grant the administration's funding requests for fraud-fighting measures, such as the Do Not Pay List. Created by a presidential memorandum in June 2010, the Do Not Pay List provides government employees with a consolidated database of people and organizations that are ineligible to receive government funds.

Though GAO warns, "[I]t is too soon to determine whether the ... [the administration's current initiative] will achieve [its] goals," there is vast potential for the government to continue reducing improper payments. Those efforts will only succeed if funds are available for implementation and if the level of determination from the White House holds steady.