U.S. Department of Energy officials routinely overpay for simple, off-the-shelf software purchases, according to the department’s inspector general.
“We determined that programs and sites routinely paid more than necessary when acquiring software licenses,” the IG said in a Sept. 30 memorandum from Inspector General Gregory H. Friedman to DOE Secretary Ernst Moniz. The memo was included in an IG report made public Monday.
DOE not only paid more than other large private-sector enterprises, but also paid more than other federal agencies. “The price per license paid by the department was often greater than established government-wide acquisition contract prices available to all federal agencies,” the IG said.
Overpayment for basic software licenses has been a long-running problem at DOE and at its 17 national laboratories. In January 2006, the Energy Department IG documented that officials were paying as much as 300 percent more for software than was available through regular sales.
The 2006 report also said DOE lacked department-wide agreements for purchasing such common products as security and anti-virus software. That problem has not been resolved, the IG said.
Friedman said the audit reviewed 10 of the department’s 37 facilities and that the overpayments could be higher since he did not review all of the department’s national labs and field facilities. Four of the labs reviewed also could not account for all of their software licenses.
DOE is responsible for energy, environmental and national security programs, including oversight of the nation’s nuclear arsenal.
Friedman found the department also had continued to ignore a 2010 directive from the Office of Management and Budget, which ordered all federal agencies to pool purchasing power to drive down costs and improve service.
President Obama appointed Moniz in May 2013, succeeding Steven Chu, whose freewheeling spending for energy grants and loans to unproven start-up companies like Solyndra lost billions of tax dollars when the recipients went bankrupt.
Friedman said Energy officials “continued to utilize a fragmented approach without a formal process for ensuring that software purchases were coordinated between Headquarters and/or field sites.”
DOE further paid very different prices for many common products. Friedman said the current audit “identified at least 52 instances where pricing for common products such as office automation, document management and engineering software varied widely,” the department’s inspector general reported Monday.
At the DOE’s Sandia National Laboratories in New Mexico, IG auditors identified 11 instances where employees paid to “acquire software licenses at higher prices than those established for the identical product in the organization’s software management system.”
DOE said it concurred with the IG’s findings and was taking “corrective actions.”
Go here to read the full DOE IG report.
