Department of Defense

Incentive to Spend

I work in contracting and it is very clear to me and everyone I've talked to that there is an incentive to spend all the money given, not save it. It's called End of Fiscal Year Spending. If you don't use it, you lose it. This is a problem with the way the budgets are created and dispersed. Any money that you do not spend, money you save, many times gets taken away from next year's budget. This is what has people thinking, "we have to get rid of all this money so that our budget won't be cut next year." Fiscal needs flucuate year to year for various reasons. It is not efficient or effective to cut one's budget based off of how much money they saved. I believe there should be a set amount that agencies get, and money that isn't spent goes back to the tax payers or towards the outstanding government debt instead of being locked into the previous fiscal year, and coming out of next years budget. Maybe the agency gets a percentage of that money to spend as they please. Regardless, the current system encourages using all of the money available, and it is not working. August through September is basically a shopping spree. We can save an incredible amount of money by simply eliminating the need to empty the coffers come end of year. Everyone knows this is happening, everyone complains, and everyone is used to it because that's how they have been doing business their entire careers. I am not used it, I know it's not right, and I know it's not fair to America or the agencies that get punished for saving money. The bottom line is we need to get rid of "fall out money", not by spending it, but by saving it. Thank You.

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Idea No. 15050