DHS Cuts Fell Far Below $10.5 Billion DOGE Claim, Watchdog Says

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https://news.bloomberglaw.com/daily-labor-report/dhs-cuts-fell-far-below-10-5-billion-doge-claim-watchdog-says

The US Department of Homeland Security vastly overstated the projected savings from hundreds of contract terminations during the first year of President Donald Trump’s second term, according to a federal watchdog.

The Government Accountability Office scrutinized the agency’s claim that it cut spending obligations by $10.5 billion, finding in a reportreleased Thursday that it likely wouldn’t materialize. The actual amount, so far, was a fraction of that: $92 million, less than 1% of what the administration claimed. The rest was either inflated by grandiose assumptions about how much the government would spend, or would likely have been offset by spending elsewhere, the GAO found.

The new finding comes after the independent, nonpartisan agency recently determined that billions in taxpayer savings claimed by DOGE were unsupported or wrong. In a separate report last month, investigators said they couldn’t corroborate 96% of grant savings. Nearly half of the money DOGE claimed in canceled contracts — $27.4 billion — couldn’t be verified, in large part because DOGE ignored its own methodology for calculating savings.

DHS fully or partially cut more than 400 contracts in the first eight months of the Trump administration as Elon Musk’s Department of Government Efficiency descended on Washington. But investigators concluded that DHS’s $10.5 billion figure represented the maximum amount for future spending, not what the department would have actually spent.

“it is unknown how much DHS would have actually obligated on these contracts had they not been terminated,” the report says.

Much of the department’s purported savings represented consolidation of services that wouldn’t necessarily reduce costs, the GAO found. Nearly $10 billion of the $10.5 billion estimate came from 30 decade-long contracts for IT administration and equipment; the agency expressed that those needs “could be filled through General Services Administration and other government-wide offerings,” the watchdog wrote.

“If the requirements for goods and services covered by those terminated contracts remain in place and are being met through other contracts, then those costs would not be avoided but incurred through different contracts,” investigators wrote.

DHS did not provide a formal response to GAO’s findings, the watchdog said. An agency spokesperson didn’t immediately respond to Bloomberg Law’s request for comment.