Paige moves to cut fraud, mismanagement in Dept. of Education

By Alex Kingsbury
U-WIRE Washington Bureau
April 20, 2001

Secretary of Education Rod Paige announced plans Friday to cut waste, fraud and mismanagement in his department with plans for an eight-member “strike team” to curb excess government spending. Paige promised results in 18 months.

“Our plan calls for accountability at every level,” Paige said in a press conference Friday. “This department … failed in its job of taking care of the people’s money.”

Earlier this month, internal review of the Department of Education’s accounts revealed that $450 million dollars had been lost in the final three moths of the Clinton administration.

The announcement prompted outrage from lawmakers with one Republican comparing the department’s funding to a “third-world republic.”

Paige pledged to root out the problems his department that allowed for billions to be lost due to theft, improper allocation and duplicate payment of student grants.

“The problems are serious,” Paige said, citing internal audits, which confirmed that the department had “poor control over information systems.”

As a remedy to the problems, he announced the formation of an eight-member “Management Improvement Team” of senior managers within the department who will be pulled from their regular jobs to work solely on the reform project. Paige charged the team to obtain a “Good Housekeeping Seal of Approval” from the external auditors, Ernst & Young, by the fall 2002. He also asked that the team report its progress to Congress and the public in three months.

“Every dollar we waste on fraud or mismanagement is a dollar that could be used for teaching our children, and this department cannot and will not continue wasting those precious resources,” said Paige in an official statement.

Paige’s statement stressed President Bush’s commitment to both reforming the mismanagement and ensuring a better educational system.

“President Bush wants this department to devote its full attention to providing all American students with access to quality education,” he said.

Paige added putting the new management team in place is part of that initiative.

An auditor’s April 3 report to the House Education and Workforce investigations subcommittee revealed that some $23 million was spent by employees who were permitted to write checks up to $10,000 without prior authorization. The review also showed lax oversight of government issued credit cards that Department employees used to purchase goods including cell phones, computers and computer software without supervisor’s approval.

The auditor’s report also showed that $250 million was paid in redundant student loan checks. Paige announced Friday that all of those monies would be recovered.

Paige said he hopes that the new initiative will restore the confidence in the public and the Congress, while making sure “no money that ought to be spent on improving the education of American children is wasted in Washington.”

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