"I have successfully led a battle to whittle down the dollar amount for which the Pentagon must match a specific purchase with its corresponding contract. Although it still sounds ridiculously high, the Pentagon will not be able to write a check for more than $500,000 without making the proper match-ups. When I started this crusade, the Pentagon wrote checks for millions of dollars with no accountability," Grassley said. Senators today voted 93 to 0 in favor of his amendment.
For each of the last five years, Grassley won passage of amendments to require matching of disbursements with obligations for any payment of $1 million or more. Both the Inspector General and the General Accounting Office have concluded that the policy is helping to reduce the Defense Department's unmatched disbursements. This year, Grassley's amendment to the DoD appropriations bill lowered the threshold to $500,000.
Two weeks ago, Grassley won Senate approval for a separate amendment to legislation to authorize defense spending. This proposal requires the DoD to develop a financial management improvement plan; requires the chief financial officer for the department to ensure that financial statements receive an unqualified or "clean" audit opinion; holds DoD disbursing officials to the same standards of accountability as those in the National Guard or Air Guard; directs the CFO of the Defense Department to set regulations to ensure that adequate safeguards and internal controls are in place to prevent the misuse of official credit cards; and, requires the DoD to undertake a feasibility study to determine if electronic payments could be subject to the same level of reconciliation as checks cut by the U.S. Treasury.
Last fall, Grassley conducted an oversight hearing that found that the Pentagon office that oversees defense contract payments has paid millions of dollars in bogus schemes because of lax internal controls. This Defense Finance and Accounting Service disburses $22 billion a month.
"My efforts are about sound business practices: don't pay out one penny until proof can be shown that the goods and services were ordered and, in fact, received. Tightening internal financial controls will help the Pentagon improve its compliance with basic bookkeeping and make the most of resources. It's a win-win situation for taxpayers, and it will help nurture the U.S. military as the world's premiere fighting force for the next 100 years," Grassley said.