Veterans Administration:

Proposed Consolidation of Philadelphia and St. Paul Insurance Offices

HRD-87-106: Published: Sep 16, 1987. Publicly Released: Oct 6, 1987.

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In response to a congressional request, GAO reviewed the Veterans Administration's (VA) cost-benefit analysis of a proposal to consolidate its life insurance field offices.

GAO found that VA: (1) estimated savings of about $3.94 million over a 5-year period in personnel, space, and equipment costs; (2) estimated personnel savings of $3.04 million, but failed to consider a difference in productivity between the field offices; (3) did not consider future salary increases for employees when it estimated personnel savings; and (4) overestimated savings in costs for office space because it did not consider the cost of adequate space to accommodate transferred operations.

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