Premium Class Travel:

Internal Control Weaknesses Governmentwide Led to Improper and Abusive Use of Premium Class Travel

GAO-07-1268: Published: Sep 28, 2007. Publicly Released: Oct 3, 2007.

Additional Materials:

Contact:

Gregory D. Kutz
(202) 512-9505
contact@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

Previous GAO work on widespread improper premium class travel at the Department of Defense (DOD) and the Department of State (State) have led to concerns as to whether similar improper travel exists in the rest of the federal government. Consequently, GAO was asked to (1) determine the magnitude of premium class travel governmentwide and the extent such travel was improper, (2) identify internal control weaknesses that contributed to improper and abusive premium class travel, and (3) report on specific cases of improper and abusive premium class travel. GAO analyzed bank data and performed statistical sampling to quantify the extent premium class travel was improper. GAO also performed data mining, reviewed travel regulations, and interviewed agency officials.

Breakdowns in internal controls and a weak control environment resulted in at least $146 million in improper first and business class travel governmentwide. The federal government spent over $230 million on about 53,000 premium class tickets from July 1, 2005, through June 30, 2006. Premium class tickets are costly--for example, a Department of Agriculture (USDA) executive flew business class from Washington, D.C., to Zurich, Switzerland, at a cost of $7,500 compared to $900 for a coach class ticket. Based on statistical sampling, GAO estimated that 67 percent of premium class travel was not properly authorized, justified, or both. While business class travel accounted for 96 percent of all premium class travel, many agencies informed us that they did not track, and thus did not know the extent of, business class travel. OMB and GSA also did not require reporting of business class travel. GAO found large differences in premium class guidance governmentwide, with some agencies issuing less restrictive guidance that were tailored for executive travel. For example, the FTR allows premium class travel for flights over 14 hours if properly authorized. However, executives at the Foreign Agricultural Service frequently used "mission critical" to justify flights to Western Europe that typically lasted less than 10 hours. Other agencies, such as State and the Millennium Challenge Corporation (MCC), automatically approved premium class travel for all flights over 14 hours. GAO's analysis of flights involving destinations in the United States and Africa, the Middle East, and parts of Europe lasting 14 hours or more showed that 72 and 83 percent, respectively, of State's and MCC's flights involving these locations were in premium class. In contrast, 3 percent of all DOD's and the Department of Homeland Security's flights to the same locations were in premium class. There are examples representing specific cases of improper and abusive use of premium class, including employees of entities not subject to the Federal Travel Regulations that have issued policies that resulted in the purchase of costly premium class travel.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: GAO found that large differences in federal agencies' premium class travel guidance and a lack of central oversight led to improper and abusive use of federal premium class travel. Consistent with the intent of our recommendation for a central oversight office for travel management, GSA created the Center for Policy Evaluation (CPE) in fiscal year 2008 to work with federal agencies to identify opportunities to improve government-wide operations, including travel and transportation. For these and other functional areas, CPE evaluates the implementation and effectiveness of agency-level policies, agency adherence to mandatory federal requirements/regulations, and adoption of best practices and innovative tools that enable Federal managers to prudently manage their assets.

    Recommendation: The Administrator of General Services Administration should take actions necessary to help agencies comply with the FTR governing the use and reporting of premium class travel by establishing an office for travel management within GSA to review agency policies and procedures, identify areas where agency policies and procedures do not adhere to federal regulations, and issue recommendations to agencies to bring their policies and procedures into compliance.

    Agency Affected: General Services Administration

  2. Status: Closed - Implemented

    Comments: GAO found that large differences in federal agencies' premium class travel guidance and a lack of central oversight led to improper and abusive use of federal premium class travel. In October 2009, GSA strengthened the government-wide management and accountability of federal premium class travel by adding a federal agency requirement to the FTR for annual certification of a disability or special need traveler and a one-time certification for a disability or special need traveler who has a lifelong condition.

    Recommendation: The Administrator of General Services Administration should take actions necessary to help agencies comply with the FTR governing the use and reporting of premium class travel by requiring that the physician's certification related to medical requirements for premium class travel be updated annually unless the physical impairment is a lifelong impairment.

    Agency Affected: General Services Administration

  3. Status: Closed - Implemented

    Comments: GAO found that large differences in federal agencies' premium class travel guidance and a lack of central oversight led to improper and abusive use of federal premium class travel. In October 2009, GSA strengthened the government-wide management and accountability of federal premium class travel by amending the FTR to require that all federal agencies develop and define what constitutes a rest period upon arrival at a temporary duty station.

    Recommendation: The Administrator of General Services Administration should take actions necessary to help agencies comply with the FTR governing the use and reporting of premium class travel by requiring agencies to define what constitutes a rest period upon arrival.

    Agency Affected: General Services Administration

  4. Status: Closed - Implemented

    Comments: GAO found that large differences in federal agencies' premium class travel guidance and a lack of central oversight led to improper and abusive use of federal premium class travel. In October 2009, GSA strengthened the government-wide management and accountability of federal premium class travel by amending the FTR to require agencies to develop and issue internal guidance that explains when mission criteria and the intent of that mission call for premium class transportation accommodations.

    Recommendation: The Administrator of General Services Administration should take actions necessary to help agencies comply with the Federal Travel Regulations (FTR) governing the use and reporting of premium class travel by requiring that agencies develop and issue internal guidance that explains when mission criteria and the intent of that mission call for premium class accommodations.

    Agency Affected: General Services Administration

  5. Status: Closed - Implemented

    Comments: GAO found that large differences in federal agencies' premium class travel guidance and a lack of central oversight led to improper and abusive use of federal premium class travel. In response to this recommendation, OMB acknowledged the need for greater transparency and accountability in managing the approval and use of premium class travel governmentwide. In this context, OMB indicated it would use GSA's analysis of agency premium class data to work with Executive branch agencies and develop an overall framework for reviewing, reporting, and auditing premium class travel. This framework would be consistent with the standards and requirements described in OMB Circular A-123, Management's Responsibility for Internal Control, in that it would follow a risk-based approach to assess the effectiveness of internal controls implemented to curtail unnecessary and unjustified use of premium class travel.

    Recommendation: In order to improve internal control over the authorization and justification of premium class travel and to strengthen monitoring and oversight of premium class travel as part of an overall effort to reduce improper and abusive premium class travel and related government travel costs, the Director of the Office of Management and Budget should use the premium class data collected by GSA to consider developing a risk-based framework containing requirements for reporting business class travel to GSA and to perform audits of premium class travel programs, including a review of executive travel.

    Agency Affected: Executive Office of the President: Office of Management and Budget

  6. Status: Closed - Implemented

    Comments: GAO found that large differences in federal agencies' premium class travel guidance and a lack of central oversight led to improper and abusive use of federal premium class travel. In October 2009, in response to GAO's findings, GSA, with the support of OMB, strengthened the government-wide management and accountability of federal premium class travel by adding a requirement to the FTR that requires all federal agencies to annually report to GSA the use of all "other than coach-class" transportation accommodations (i.e., premium class travel which includes both business class and first class travel accommodations) which exceed the coach-class fare.

    Recommendation: In order to improve internal control over the authorization and justification of premium class travel and to strengthen monitoring and oversight of premium class travel as part of an overall effort to reduce improper and abusive premium class travel and related government travel costs, the Director of the Office of Management and Budget should establish policies and procedures to initially require all federal agencies to collect data on the use of all premium class travel, including business class, and submit the information to GSA annually until a risk-based framework is developed.

    Agency Affected: Executive Office of the President: Office of Management and Budget

  7. Status: Closed - Implemented

    Comments: GAO found that large differences in federal agencies' premium class travel guidance and a lack of central oversight led to improper and abusive use of federal premium class travel. In January 2008, in response to GAO's overall finding, OMB directed federal departments and agencies to immediately implement a number of premium class travel policies and controls to ensure that conditions surrounding the request for and use of premium class travel accommodations are reasonable and necessary. Related to this recommendation, OMB required federal departments and agencies to establish policy whereby premium class travel requests for all agency personnel, including senior-level executives, would be approved by an individual at least at the same level as the traveler, or by an office designated to approve premium class travel. OMB further instructed departments and agencies to confirm that this policy and related controls were included in their respective internal travel guidelines/regulations, and implemented accordingly.

    Recommendation: In order to improve internal control over the authorization and justification of premium class travel and to strengthen monitoring and oversight of premium class travel as part of an overall effort to reduce improper and abusive premium class travel and related government travel costs, the Director of the Office of Management and Budget should instruct agencies that premium class travel requests for their senior-level executives must be approved by someone at least at the same level as the traveler or an office designated to approve premium class travel for all senior-level executives.

    Agency Affected: Executive Office of the President: Office of Management and Budget

  8. Status: Closed - Implemented

    Comments: GAO found that large differences in federal agencies' premium class travel guidance and a lack of central oversight led to improper and abusive use of federal premium class travel. In response to this recommendation, GSA revised Federal Travel Regulations (FTR) to require federal agencies to submit premium class travel data (i.e., federal employees' travel accommodations other than coach-class) to GSA for analysis, issued FTR Bulletin 10-05 to agencies that specifies premium class travel reporting requirements, and developed a web-based data collection tool that agencies will now use to submit the required travel data. This data collection tool was developed after GSA and agencies attempted to use the existing Travel Management Information System to collect premium class data; however, this system could not capture data elements necessary for premium class reporting. The web-based collection tool has undergone beta testing, and will be used by agencies to collect 2011 premium class travel data later this year. Agencies have been directed to submit their 2011 data to GSA by mid-January 2012. GSA will then analyze this data and identify specific premium class travel policies that may need to be reviewed and revised, including those proposed in our recommendation to clarify guidance on authorizing premium class use only when less costly means of transportation are not practical and to limit premium class travel for permanent change of station moves to only those situations where certain conditions (i.e., physical handicap or medical/security considerations) or cost factors apply. GSA's actions, both implemented and planned, satisfy the intent of this recommendation.

    Recommendation: The Administrator of General Services Administration should take actions necessary to help agencies comply with the FTR governing the use and reporting of premium class travel, based on the premium class data collected from agencies, determine if the government should clarify guidance concerning authorizing premium class travel only when less costly means of transportation are not practical and limit the use of premium class travel for permanent change of station moves to those necessary as a result of physical handicap, medical reasons, or security reasons, or if the trip is taken at no additional cost to the government.

    Agency Affected: General Services Administration

 

Explore the full database of GAO's Open Recommendations »

Jul 9, 2014

Jun 19, 2014

May 30, 2014

May 15, 2014

May 13, 2014

May 12, 2014

May 2, 2014

Mar 27, 2014

Mar 13, 2014

Looking for more? Browse all our products here