Information Technology Investment

Increasingly, federal agencies' ability to improve performance and cut costs depends on automated data processing systems that give managers critical financial and programmatic information needed to make good decisions, hold down costs, and improve service to the public. However, major federal investments in information technology have often yielded poor results--costing more than expected, falling behind schedule, and failing to meet mission needs. To shed light on whether information technology dollars are being spent, what costs and benefits are anticipated, and what risks must be managed, this report provides information on overall federal information technology obligations, as well as on program by GAO, the Office of Management and Budget, and the General Services Administration to identify information technology investments that are at risk and in need of corrective action.

GAO found that: (1) the total amount of federal IT spending is unknown, since the Office of Management and Budget (OMB) does not collect comprehensive IT budget data on a governmentwide basis; (2) federal agencies do not generally break out IT obligations as separate line items in their budget documents, but they include this information within program or administrative costs; (3) OMB reported that executive branch agencies plan to obligate about $26.5 billion in IT-related funds in fiscal year (FY) 1996; (4) OMB does not require the reporting of some potentially significant types of IT spending, resulting in billions of dollars in unreported spending; (5) IT-related obligations have increased by about $4 billion since FY 1991, despite the decline in defense obligations; (6) 11 federal agencies have IT-related problems serious enough to be categorized as high-risk; and (7) these IT-related problems warrant increased congressional oversight to ensure that top agency management takes corrective action.