USPS Says $1.4 Billion Waste, Fraud and Abuse Not True

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The U.S. Postal Service has rebutted reports that its Office of Inspector General has found $1.4 billion in agency waste, fraud and abuse.


In an article last week on USPSNewsOnline, an online news source for postal employees, the USPS said critics are focusing on a statement by the inspector general's office that the OIG had made recommendations that yielded $1.4 billion in savings since the independent oversight agency began in 1997.


However, the article said, "Unfortunately, that statement has been misinterpreted by some who say the OIG has identified $1.4 billion in waste, fraud, abuse and mismanagement. It just ain't so."


Part of the confusion stems from the way the OIG categorizes savings. According to the USPS, the OIG lumps all savings under the category of waste, fraud, abuse and mismanagement, even when only savings are involved.


Most of the $1.4 billion is related to funding approved by the USPS Board of Governors in 1998 for the Corporate Call Management program, according to the USPS. In the two years after the funding was approved, USPS program managers determined that their original, seven-year cost projections could be reduced by more than $962 million based on actual call volume and technological advances.


During the same period, the OIG conducted an audit of the program and discovered the same long-term cost savings.


"This $962 million savings is a significant part of the $1.4 billion being incorrectly identified as USPS waste, fraud and abuse," the article said.


As for the balance of the $1.4 billion, the article said, "Some of the cost avoidances cited by the OIG had already been identified by postal service managers and captured as savings. Some were OIG recommendations that the USPS implemented and was money we saved. In other instances, USPS simply disagrees with the OIG figures."


Regardless, the letter said, "Our mutual identification with the OIG of long-term savings is a far cry from the erroneous allegations that USPS operations and programs are wasteful or fraudulent."


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