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CAGW Releases Statement on 2014 GAO Report on Federal Software Licenses

Today, Citizens Against Government Waste (CAGW) expressed its concern about the findings of the Government Accountability Office (GAO) in its May 22 report, “Federal Software Licenses.” GAO revealed that only two of the 24 major federal agencies have “comprehensive policies that include clear roles and central oversight authority for managing software licenses.” Eighteen agencies have non-comprehensive policies, while four agencies have none at all. The GAO report concluded that “the lack of robust licensing policies is due in part to the absence of direction from the Office of Management and Budget (OMB).”

The federal government plans to spend approximately $82 billion in fiscal year (FY) 2014 on information and technology products and services, including software and software licenses. Since agencies do maintain a comprehensive software license inventory, the GAO could not determine the exact amount of money that could be saved if there was better management of software assets, nor could it accurately describe the most widely used software applications across the government. The GAO report is not the first indication of the government’s mismanagement of software assets. On April 10, 2014 CAGW released a statement regarding a final audit report from the U.S. Treasury Inspector General for Tax Administration, which found that the Internal Revenue Service failed to accurately account for $235 million it spent on software licenses in 2011.

On May 10, 2013, CAGW hosted an education briefing that noted that off-the-shelf software asset management tools are already used extensively in the private sector, state and local governments, and at some federal agencies. For example, the Department of Homeland Security was able to avoid spending $181 million in FY 2012 and saved an additional $376 million from FY 2013-2015 by improving software management. The GAO report shows that this is an exception to the abysmal management of software assets elsewhere in Washington.

Currently, two executive orders and pending legislation address agency software inventories. Executive Order #13103 requires agencies to ensure they do not violate copyright laws relating to software use, while Executive Order #13589 requires agencies to assess current inventories to prevent paying for unused or underutilized IT equipment, installed software or services. The Federal Information Technology Acquisition Reform Act, H.R. 1232, which was approved by the House on May 22 as an amendment to H.R. 4435, the fiscal year 2015 National Defense Authorization Act, also includes language requiring agencies to gain better control over their software assets.

“While the GAO report illustrated that a few agencies have found opportunities to reduce software license spending and duplication, an unacceptable number of agencies still are not adequately analyzing their data in order to reduce waste and mismanagement,” said CAGW President Tom Schatz. “Hopefully, the OMB will follow the GAO report’s recommendations and create a software license management policy, something that should have been done long before now.”

Citizens Against Government Waste is a nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, mismanagement and abuse in government.

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