From the U.S. Government Accountability Office, www.gao.gov Transcript for: Comptroller General Testifies to U.S. House on GAO’s 2019 High Risk List Update Description: In his March 6, 2019, testimony to the U.S. House of Representatives, Comptroller General Gene Dodaro provides an update of GAO's 2019 High Risk List, including two new areas added since 2017: VA acquisition management, and government-wide personnel security clearance process. Related GAO Works: GAO-19-392T: Substantial Efforts Needed to Achieve Greater Progress on High-Risk Areas Released: March 2019 [First Screen] High Risk Series: Substantial Efforts Needed to Acheive Greater Progress on High Risk Areas [Second Screen] House Committeee on Oversight and Reform [Third Screen] Opening Statement by U.S. Comptroller General Gene L. Dodaro March 6, 2019 >> Thank you very much, Mr. Chairman. Good afternoon to you ranking member, Congressman Jordan, members of the committee. It's a pleasure to be here to discuss the latest update to GAO's high-risk list. This high-risk program continues to be a valuable congressional tool for oversight and produces tangible benefits for the American people, as both, Mr. Chairman, you and Ranking Member Jordan outlined in your opening statements. I'm pleased to report that of the 35 areas, seven have made progress since our last update in 2017. For the seven, Congressman Jordan, were DOD areas. I'm pleased with the management team over there. They're doing a good job addressing some of these issues. Two have progressed far enough for us to take them off the list. DOD supply chain management as a result of improvements or millions of dollars being saved now, an inventory management, asset visibility, material distribution. And it's improved DOD's ability to carry out its mission because it needs to have the supplies at the right time at the right place to do a good job. The other area is mitigating gaps in weather satellites. We were very concerned about this years ago because it would diminish the ability to get long-term and short-term weather forecasts, which are so necessary to protect life and property. As a result of being on the high-risk lists and actions taken by the Congress, NOAA has launched a new satellite, and it's already operational, and it's producing better weather information than what we've had before. And DOD, which operates the other polar orbiting satellite, is scheduled to release a new satellite within the next couple of years, so this is back on track. Now unfortunately, many of the areas on a 35 list haven't really changed that much since our last update in 2017. There have been some improvements but not enough to change the rating against our five criteria for coming off the list, which are leadership, commitment, the ability to have the capacity, the resources, and the people, have an action plan with milestones and measures to do a monitoring effort, and actually demonstrate some progress in that area. Three areas have regressed, which we're concerned about, one is NASA's acquisitions. Second is EPA's assessments of toxic chemicals. And the third is limiting the federal government's fiscal exposure by better managing climate change risks. Now we're adding -- have added two areas in the update, one is government-wide personnel security clearances, as has been mentioned. We added that in January 2018 and at that time, the backlog was 700,000. So, the backlog has been lowered to 565,000 now, so they're making some progress in that regard. Second we're adding today is the acquisition programs at the Veterans Administration, their outdated policies and practices. They haven't been able to save a lot of money, it's one of the largest of procurement budgets in the government. Many purchases are being made under emergency situations when they should be able to more routinely identify what kind of medical supplies and services that they need for the hospital, so that's an important area. There are a number of areas that I want to single out for this committee that I think are very important, one is the Pension Benefit Guaranty Corporation, the multi-employer portion of that pension system is likely to be insolvent by 2025. That means about 11 million Americans will only be able to likely receive $2,000 a year for a pension, and this is not adequate, so that's a big problem. Second is the federal role in housing finance. Fannie Mae and Freddie Mac are still under federal conservatorship from the global financial crisis. Ginnie Mae portfolio now is over two trillion dollars. FHA portfolio is 1.2 trillion dollars. A lot of lending now is made by non-banks, which are not very well regulated. And all the risk has moved to the federal government, 71percent of the loans now for individual mortgages are supported by the federal government, either directly or indirectly. Cybersecurity needs to be addressed. I -- we did a special update last year, we testified before two subcommittees of this committee on the urgent actions that are needed to be required in that area. Veteran's healthcare remains a problematic area, as well as a lot of improper payments across Medicare, Medicaid, Earned Income Tax Credit, and of course, the tax gap, which is very significant. So, I thank you for the opportunity to be here, Mr. Chairman. I look forward to answering all your questions.