Evening star., 1946-08-15
Duplicate Payments
By Navy Uncovered
In GAO Checkup
fFourtIs OF a Series.)
BY Joseph HonIon
Washington Correspondent Of the ST Louis
pnst Dispotch

All IllliAaU UAOlt Va ielhltN W
Government procurement agen-
cieS in the rush to achieve maxi
mum wartime production is con-
tained in report of the Genera,
Accounting ONCE on spot
check of Navy procurement
methods. Made late in 1914, il
showed duplicate payments tC
contractors in sums ranging
from $57,96 to sos, ,626 and total
ing more than $l,000,000.
That the Navy was not alone II
free and easy-and unnecessary
penditure of the peoples money is
shown in another report on costly
Army housing and recreation facility
near Choteau. Okla. which the GAO
reported was used by only neglible
percentage of the war workers fol
whom it was intended.
Limited Period Covered.
Such incidents, added to others
which have been and will be de-
scrlbed in this series on war waste
illustrate what Controller General
Lindsay c. Warren meant recently
when he told the Mead Committee
of the Senate that untold billions
had been wasted in war contracts.
The GAO check on duplicate
payments by the Navy was limited
to accounts being handled at the
time the survey was made and by
no means covers The entire war pc
Rod. The amount of duplicate pay
ments discovered was 81 ,033 ,433 and
the GAO men reported their study
showed need for immediate cor
rective action by the Navy TO elm
mate inadequate procedures in
processing invoices for payment 10
various contractors.
The Navy's fiscal director, w. J.
Mcneil, told the reporter, however
the GAO survey of these duplicate
payments had been made after the
Navy itself had diclosed to the con-
troller general their discovery by its
disbursing officers in certain con-
tracts
More than two months after this
situation was called to the Navy s
attention, it replied that the prob
lem had been receiving constant
study as a result of which there was
then being installed. IN March, l945,
system of centralRing accounting
and disbursing practices BY which
it expected to eliminate duplicate
payments
Personnel Waste Hit.
The following October, GAO
again had occasion TO criticize Navy
procurement methods-thls time for
"prodigal use of personnel and ma
terial." This GAO report dealt with
10000 purchase orders for items OF
small or no value. AS horrible
example the report cited orders for
items which cost nothing at all, 2
cents. 4 cents, 9 cents and II cents.
Each purchase instrument, the
report adds, involves the prepara-
ton of several prescribed forms,
comprising seven sheets of printed
matter. AS many as % copies OF the
order are distributed. or a total OF
l6l sheets TO obtain an article having
no value" or priced at few cents.
In the above five cases total of 800
sheets of paper we're required to
cover purchases involving the total
amount of 26 cents.
Not included in the GAO reports
seen by this reporter was similar
incident related by a member of the
GAO staff who was Navy contract
officer during the war When a
dealer walked into his office with the
wooden handle for an electric switch,
he found that a purchase order had
been issued for it.
Less Trouble as Gift.
Waving the forms in one hand
and holding the switch handle IN
the other. the dealer said: Here.
! want to make you present Of
this, I'd rather do that than fill
out the forms.
But a subordinate protested that
he could not accept the switch
handle on that basis-it was against
regulations. The we can't"
said the naval officer, now with
GAO. Take it and send it airmail
to the ship that wants it
The Oklahoma housing and recre-
alton facility mentioned earlier were
intended to serve workers at INT
plant situated between Tulsa and
There were IS dormi-
tories, two cafeterias. three recrea-
tion halls, two post exchanges with
such services as barber shops, beauty
parlors and laundries. theater. a
boat dock and boats, saddle horses
and athletic fields.
But most of the workers seemed
to want to live in Tulsa or Muskogee,
or other nearby towns. The GAO
report. made in May. 1913, set out
that the plant then employed 500
persons and was operating at 70
percent of capacity. The facilities
described had been designed for use
of 1000 workers, but GAO the report
said no more than 325 persons had
ever occupied the dormitories at any
one time.
Previous articles in this series
have dealt with cost plus fixed con-
tracts and negotiated price con-
tracts, pointing to cases in which
both failed 10 protect the Govern
ment's interest.
Data Indicate Ratio.
There is not available any COM
pilation Of how much the Govern
ment spent on cost-plus contracts,
and how much on fixed price, but
the most recent report of the Of
flee of Contract Settlement, which
has nearly completed its work, sheds
some light on the ratio between the
Two forms Of contract.
From the beginning of the war
10 June 30, the Office of Contract
Settlements reported, 304, 1870 fixed
price contracts, involving commit
ments of $4,000 ,000,0 900, had been
settled. For the same period 1,025
cost-plus contracts involving can
celed commitments of $4,000 000,-
900 had been settled. 1t will be
noted that while the fiXed-price con-
tracts were larger, both in num-
Der and in total dollars. the indi-
vioual CoSt-plus contracts were
much larger, on the average.
Friaic mould 1o1l -