The federal government spent about 75 percent of the total amount budgeted for information technology (IT) for the fiscal year 2015 on operations and maintenance (O&M) investments, according to a report released by the U.S. Government Accountability Office (GAO) on Wednesday, May 25.
The report continued: Such spending has increased over the past seven fiscal years, which has resulted in a $7.3 billion decline from fiscal years 2010 to 2017 in development, modernization, and enhancement activities.
Specifically, 5,233 of the government's approximately 7,000 IT investments are spending all of its funds on O&M activities.
Moreover, the Office of Management and Budget (OMB) has directed agencies to identify IT O&M expenditures known as non-provisioned services that do not use solutions often viewed as more efficient, such as cloud computing and shared services. Agencies reported planned spending of nearly $55 billion on such non-provisioned IT in fiscal year 2015.
OMB has developed a metric for agencies to measure their spending on services such as cloud computing and shared services but has not identified an associated goal. Thus, agencies may be limited in their ability to evaluate progress.
The GAO, during its review, identified many O&M investments as moderate- to high-risk by agency CIOs, and agencies did not consistently perform the required analysis of these at-risk investments. Further, several of the at-risk investments did not have plans to be retired or modernized, the GAO found. Until agencies fully review their at-risk investments, the government's oversight of such investments will be limited, and its spending could be wasteful, according to the GAO.
Federal legacy IT investments are becoming increasingly obsolete: many use outdated software languages and hardware parts that are unsupported. Agencies reported using several systems that have components that are, in some cases, at least 50 years old. For example, the Department of Defense uses 8-inch floppy disks in a legacy system that coordinates the operational functions of the nation's nuclear forces. In addition, the Department of the Treasury uses assembly language code—a computer language initially used in the 1950s and typically tied to the hardware for which it was developed.
OMB recently began an initiative to modernize, retire, and replace the federal government's legacy IT systems. As part of this, OMB drafted guidance requiring agencies to identify, prioritize, and plan to modernize legacy systems, but the GAO is concerned that, until this policy is finalized and fully executed, the government runs the risk of maintaining systems that have outlived their effectiveness.
Why GAO Did This Study
The GAO undertook this study to assess federal agencies' IT O&M spending, to evaluate the oversight of at-risk legacy investments, and to assess the age and obsolescence of federal IT. The federal government invests more than $80 billion on IT annually, with much of this amount reportedly spent on operating and maintaining existing (legacy) IT systems. Because of the value of these investments, the GAO wanted to measure how effectively agencies manage their O&M.
To do so, GAO reviewed OMB and 26 agencies' IT O&M spending for fiscal years 2010 through 2017. GAO further reviewed the 12 agencies that reported the highest planned IT spending for fiscal year 2015 to provide specifics on agency spending and individual investments.
The GAO is making 16 recommendations, one of which is for OMB to develop a goal for its spending measure and finalize draft guidance to identify and prioritize legacy IT needing to be modernized or replaced. GAO also recommends that selected agencies address at-risk and obsolete legacy O&M investments. Nine agencies agreed with GAO's recommendations, two agencies partially agreed, and two agencies stated they had no comment. The two agencies that partially agreed, Defense and Energy, outlined plans that were consistent with these recommendations.
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