Recommendation: The Secretary of Labor should ensure that BLS explores cost-efficient ways to evaluate the data sources currently used to produce subpopulation indexes, such as by engaging more directly with other stakeholders or seeking input from its advisory groups and other knowledgeable entities about approaches to expand data collection in a cost-efficient manner. (Recommendation 1)

Agency: Department of Labor
Status: Open

Comments: The Department of Labor agreed with this recommendation and stated that it would continue to investigate improvements to subpopulation indexes.

Recommendation: The Secretary of Labor should ensure that BLS explores the use of already collected National Accounts data to produce more accurate, timely, and relevant CPIs. (Recommendation 2)

Agency: Department of Labor
Status: Open

Comments: The Department of Labor (DOL) disagreed with this recommendation, stating that the National Accounts data are not a replacement for Consumer Expenditure Survey data. We agree that the National Accounts data are not a wholesale replacement for the Consumer Expenditure Survey data, but it would still be useful to examine National Accounts data as an augmenting, alternative source of data to supplement or enrich the Consumer Expenditure Survey. Such an effort could potentially lead to more accurate, timely, and relevant CPIs. Although DOL noted that the Consumer Expenditure Survey is a continuous survey and that data are received quarterly, most CPIs still rely on expenditure weights based on Consumer Expenditure Survey data that are up to 4 years out-of-date. In addition, the Consumer Expenditure Survey faces increasing costs and declining response rates. DOL said it is exploring ways to accelerate the data collection and processing time and that it periodically investigates the frequency of updating expenditure weights. This is a laudable effort that we believe warrants further action to explore additional opportunities for improvement, such as researching the extent to which there are instances or categories for which the National Accounts data could be used to produce more up-to-date expenditure weights than the Consumer Expenditure Survey.

Recommendation: The Director of the Office of Allowances (ALS) should clearly document how the conditions at relevant posts meet the criteria for Director Points to ensure that hardship pay rates for overseas posts are consistently determined across posts and tenures of ALS Directors. (Recommendation 1)

Agency: Department of State
Status: Open

Comments: In commenting on our report, State concurred with our recommendation. As of January 2020, the Director of ALS has not granted any Director Points since the subject GAO review was completed. According to State officials, should points be necessary in the future, ALS will document why the conditions at relevant posts require the use of Director Points connected with hardship pay rates. We will continue to follow-up on this.

Recommendation: The Undersecretary of Management should assess the cost-effectiveness of State's policies and procedures for stopping and starting hardship pay for employees who temporarily leave their assigned overseas posts. (Recommendation 2)

Agency: Department of State
Status: Open
Priority recommendation

Comments: State concurred with this recommendation, and reported that the department is taking a two-pronged approach to reviewing the issue. First, the Department is conducting a comprehensive review of all costs associated with the processing of hardship and other associated allowance and differential cables through reviews of post-level and central expenditures. This review is expected to be complete by October 2020. Second, the Department is costing out alternative methods of addressing allowance and differential costs that reduce the manual effort on the Department but address the need to support costs incurred by Foreign Service Officers overseas. Meetings with Foreign Service Officer staff to understand variances in the current model were held in the summer of 2019. Highlights from those sessions are being incorporated into a proposal to coincide with the review of costs from the first phase. The final proposal is expected to be complete by the end of 2020.

Recommendation: The Department's Comptroller should analyze available diplomatic cable data from overseas posts to identify posts at risk of improper payments for hardship pay, identify any improper payments, and take steps to recover and prevent them. (Recommendation 3)

Agency: Department of State
Status: Open
Priority recommendation

Comments: State concurred with this recommendation. According to State, it continues to identify and seek repayment of improper payments and communicate the importance of timely actions to the regional bureaus and posts to ensure improper payments do not occur. In addition, the Bureau of the Comptroller and Global Financial Services (CGFS) supports the roll out of the Overseas Personnel System, which will centralize the collection of arrival and departure data for the calculation of improper payment notification and risk analysis. To fully implement the recommendation, the Bureau of Human Resources (HR) must complete worldwide deployment of the Overseas Personnel System, and both HR and CGFS would need to complete integration work to enable arrival and departure data to flow in an automated fashion between the two systems. CGFS would then need to provide documentation that the system allows it to more easily identify and prevent improper payments. Preliminary development of the integration will begin in the summer of 2020 while the OPS roll-out continues.