Improper Payments in the Federal Government: Student Aid

PURPOSE:

• To evaluate the Department of Education’s (the Department) progress towards accurately estimating improper payments and its plans to prevent them in the future. 
• To examine how the Department recovers overpayments.

BACKGROUND:

• Improper payments are defined as any payment that should not have been made or that was made in an incorrect amount.
• The Improper Payments Elimination and Recovery Act (IPERA) requires an agency to periodically identify and report its programs that are susceptible to significant improper payments.
• The Office of Management and Budget designated the Federal Direct Student Loan program and the Pell Grant program as “high priority” programs, meaning they have some of the highest improper payments of all federal programs; A May 2017 report found that the Department’s improper payments rose in both of these programs.
• The Inspector General has repeatedly found that the Department failed to accurately estimate improper payments and comply with the IPERA.