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Published in Print: August 8, 2001, as Paige, Seeking 'Clean' Audit, Tightens Dept. Procedures

Paige, Seeking 'Clean' Audit, Tightens Dept. Procedures

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Secretary of Education Rod Paige has curbed employees' spending authority and plans to put top managers on performance contracts in new efforts to hold his agency more accountable.

But more work needs to be done to bring under control the Department of Education's long-standing, systemic accounting problems, an independent auditor last month told members of Congress.

Rod Paige

The agency released an interim report on July 17 to highlight actions taken under the Bush administration that department officials say will help improve management. Officials from the department and General Accounting Office went to Capitol Hill on July 24 to answer questions on the subject.

"The department has taken some very positive steps, but there are other actions that need to be taken," Linda Calbom, the director of financial management and assurance for the GAO, told the House subcommittee that oversees investigations. The GAO is the investigative arm of Congress.

The 4,800-employee Education Department has already begun some corrective moves, including monthly reconciliation of some financial accounts and more oversight of employees' use of travel and purchase cards, which are used to buy supplies. In recent years, 661 recommendations have been put forth by auditors, the GAO, and other advisers. Mr. Paige estimated last month that the department had taken action on about 300 of those suggestions.

"In the last 90 days, a lot has taken place," the secretary said at a news conference held to release the interim report. "We have dedicated ourselves to the proposition that the Department of Education can be a well-run, well-respected agency."

Mr. Paige also plans to add an assistant secretary for management to his top-level team, and to have that person oversee the remedies. The position, which would require Senate confirmation, was filled in previous administrations but has been vacant for more than five years.

Agency Team at Work

Mr. Paige formed a team of veteran department employees, and told them to investigate the problems and devise concrete responses to the backlog of recommendations. The team will continue to work through September, then release a final report and a five-year action plan.

Since taking office in January, Secretary Paige has called for a "culture of accountability" and has vowed to fix what are seen as long- running problems in the agency's financial operations. ("Paige Announces Plan To Address Mismanagement," April 25, 2001.)

The department has failed audits the past three years because of missing or incomplete records, and has been investigated by Congress.

Earlier this year, meanwhile, 11 people, including four employees, were indicted on charges of defrauding the agency of more than $1 million by stealing technological equipment and turning in false timesheets.

Mr. Paige says he aims to create safeguards to prevent any such abuses and to achieve a "clean" audit in 15 months.

The next audit is due in September.

Two career employees who serve on the task force said the agency's culture is changing for the better under Mr. Paige.

Bob Danielson, the deputy chief information officer, and John Higgins, the deputy inspector general, said that employee morale dropped after the allegations of mismanagement and that most department workers were happy to see the focus on accountability.

"[Mr. Paige's] effort has energized the issue of accountability," Mr. Higgins said. "Over the years, some internal controls got relaxed."

Republican critics in Congress have suggested that more episodes of alleged fraud and abuse could be uncovered, and they have accused the Clinton administration of having had a lax attitude toward the problems.

Former Secretary Richard W. Riley and other Clinton education officials have strongly disputed Republican criticism of their management record. They say that the department took vigorous action over the past eight years to address management woes, such as curbing problems in the student financial-aid system inherited from their GOP predecessors.

Secretary Paige said he was not going to point fingers, and instead plans to focus on current issues. "We're looking forward, not backwards," he said last month.

Vol. 20, Issue 43, Page 38

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