International Food Aid:

Better Agency Collaboration Needed to Assess and Improve Emergency Food Aid Procurement System

GAO-14-22: Published: Mar 26, 2014. Publicly Released: Mar 26, 2014.

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What GAO Found

Although the U.S. Department of Agriculture (USDA) and U.S. Agency for International Development (USAID) jointly manage international emergency food aid procurement, the agencies disagree about the usefulness of the Web Based Supply Chain Management system (WBSCM) to manage the entire process. WBSCM had significant deficiencies when it was implemented in April 2011, which led USAID to discontinue using it to procure ocean freight for bulk commodities, manage prepositioned or stockpiled commodity inventory, and track food aid shipments. For example, WBSCM was slow and time consuming to use and its process to procure ocean freight for bulk commodities was not compatible with USAID's process to negotiate contracts with ocean freight vendors. USDA currently uses WBSCM to procure food aid commodities, while USAID procures ocean freight using other systems not connected to WBSCM. Since March 2012, USDA has made changes to WBSCM, and USDA officials assert that these changes address some of the problems that led to USAID's decision to discontinue use of the system.

Since USAID uses systems outside of WBSCM, USAID and USDA lack information on individual food aid shipments, which, in turn, hinders USDA's ability to use WBSCM to prepare reports and efficiently file claims against ocean carriers to recover U.S. government funds. GAO's Standards for Internal Control in the Federal Government state that information should be accurately recorded and communicated to those who need it and in a form that enables them to carry out their internal control and other responsibilities. USAID relies on freight forwarders to track and periodically provide information on shipments. In GAO's work for a recent report, we found that freight forwarders did not collect complete or consistent information on emergency food aid shipments. Without accurate information from its freight forwarders, USAID is limited in its ability to generate accurate information on food aid shipments. In addition, GAO found that USAID and its warehouse contractors did not always accurately record all prepositioned commodity inventory transactions. USAID provides this potentially inaccurate information to USDA officials who enter this information into WBSCM to generate quarterly financial statements. Moreover, USAID's data collection outside WBSCM makes it more difficult for USDA to file claims efficiently against ocean freight vendors and recover U.S. funds because USDA officials must manually enter USAID information. According to USDA officials, USDA filed 131 such claims in fiscal year 2012 valued at $1.2 million.

USDA and USAID are not collaborating effectively to resolve their disagreement on the usefulness of WBSCM. In prior work, GAO identified key elements of effective collaboration that can enhance and sustain collaboration among federal agencies. Although USDA and USAID's collaborative efforts have incorporated some of these elements to develop WBSCM, they have not incorporated others. Specifically, USDA and USAID do not agree on the roles and responsibilities of key participants in the process, do not share a defined outcome for their collaboration, and do not have a written agreement stating how the agencies will collaborate. An upcoming functional upgrade of WBSCM offers an opportunity to make substantial changes that are mutually agreeable.

Why GAO Did This Study

USDA and USAID spent about $9.2 billion to provide international emergency food aid during fiscal years 2007-2012. USDA developed WBSCM with USAID's input to manage domestic and international food aid procurements. USDA spent about $187 million to develop and implement the system. GAO was asked to examine the international emergency food aid procurement process.

This report examines (1) the extent to which agencies agree to use WBSCM to manage the process, (2) how the agencies' use of WBSCM and other systems affects USDA's ability to have accurate information, and (3) the extent to which the agencies are collaborating on how to use WBSCM. GAO reviewed the procurement process and observed WBSCM in use. We analyzed inventory spreadsheets used to compile USDA's financial reports. We compared agencies' efforts to collaborate against key elements for effective interagency collaboration.

What GAO Recommends

GAO recommended the agencies work together to ensure USDA receives accurate prepositioned inventory data, improve WBSCM's functionality by testing modified functions, and develop a written agreement that clearly outlines outcomes and roles and responsibilities for using WBSCM. USAID noted its view that prepositioned commodities move off USDA's books and onto those of USAID but agreed in general with our other two recommendations. USDA agreed with our recommendations and stated that the Commodity Credit Corporation retains ownership of prepositioned commodities.

For more information, contact Thomas Melito at (202) 512-9601 or melitot@gao.gov.

Recommendations for Executive Action

  1. Status: Open

    Comments: USDA states that USAID provides information on pre-positioning inventories on a quarterly basis, but USDA cannot independently verify the accuracy of the information. In addition, USAID does not use Web Based Supply Chain Management system (WBSCM) to manage inventory at the preposition warehouses, which could make it easier for USDA to compile its quarterly financial reports. In May 2015, USDA officials agreed to meet with USAID officials to explain their information needs and demonstrate how WBSCM can be used to manage prepositioning inventory.

    Recommendation: To improve the efficiency and accountability of the emergency food aid procurement process, the Secretary of Agriculture and Administrator of USAID should direct their staffs to work together to take steps to improve USDA's ability to account for U.S. government funds by ensuring that USAID provides USDA with accurate prepositioned commodity inventory data that USDA can independently verify.

    Agency Affected: Department of Agriculture

  2. Status: Open

    Comments: USAID states it has taken steps to ensure the accuracy of the quarterly pre-position warehouse data it provides to USDA. For example, USAID says both the Food for Peace and Transportation Division staff review the data they receive from USAID's 6 warehouse contractors before it is compiled into one spreadsheet and provided to USDA. If any discrepancies or inconsistencies are found, USAID resubmits a corrected report. In May 2015, USAID officials agreed to meet with USDA officials to better understand USDA's information needs and how Web Based Supply Chain Management system (WBSCM) can be used to manage prepositioning inventory.

    Recommendation: To improve the efficiency and accountability of the emergency food aid procurement process, the Secretary of Agriculture and Administrator of USAID should direct their staffs to work together to take steps to improve USDA's ability to account for U.S. government funds by ensuring that USAID provides USDA with accurate prepositioned commodity inventory data that USDA can independently verify.

    Agency Affected: United States Agency for International Development

  3. Status: Open

    Comments: In August 2014, USDA completed an assessment of WBSCM's functionality for international procurement process with the Foreign Agriculture Service. Unfortunately, USAID was not able to participate and test the functionality of the system at that time. USDA has reached out to USAID and other stakeholders such as freight forwarders to identify other pain points with the current Web Based Supply Chain Management system (WBSCM) international procurement process. According to USDA officials, the agency has funding to make the necessary changes if identified.

    Recommendation: To improve the efficiency and accountability of the emergency food aid procurement process, the Secretary of Agriculture and Administrator of USAID should direct their staffs to work together to take steps to assess WBSCM's functionality by testing the international procurement functions that have been modified since April 2011 and documenting the results.

    Agency Affected: Department of Agriculture

  4. Status: Open

    Comments: USAID stated it has discussed the modifications made to the international procurement functions in Web Based Supply Chain Management system (WBSCM) with both USDA and freight forwarders. According to USAID, the agency initially experienced technical difficulties with testing the modifications and functions in August 2014. However, in May 2015, USAID officials said they were willing to test additional modifications and functionality at the request of USDA.

    Recommendation: To improve the efficiency and accountability of the emergency food aid procurement process, the Secretary of Agriculture and Administrator of USAID should direct their staffs to work together to take steps to assess WBSCM's functionality by testing the international procurement functions that have been modified since April 2011 and documenting the results.

    Agency Affected: United States Agency for International Development

  5. Status: Open

    Comments: USDA has created a team to work with USAID to develop a memorandum of understanding that clearly outlines the roles and responsibility of Web Based Supply Chain Management system (WBSCM) users. In May 2015, USDA officials met with a representative of the USAID Food for Peace office, who identified the USAID official that USDA should contact to discuss the provisions of the memorandum.

    Recommendation: In preparation for WBSCM's functional upgrade, the Secretary of Agriculture and Administrator of USAID should direct their staffs to work together to take steps to develop a written agreement signed by both agencies that clearly outlines the desired outcomes of their collaboration and the roles and responsibilities of participants, such as freight forwarders.

    Agency Affected: Department of Agriculture

  6. Status: Open

    Comments: USAID stated that USDA and USAID officials have met on an ad hoc basis regarding Web Based Supply Chain Management system (WBSCM); however, no written agreement has been developed as of March 2015. In May 2015, USAID identified a point of contact for USDA to work with in developing the provisions of a memorandum.

    Recommendation: In preparation for WBSCM's functional upgrade, the Secretary of Agriculture and Administrator of USAID should direct their staffs to work together to take steps to develop a written agreement signed by both agencies that clearly outlines the desired outcomes of their collaboration and the roles and responsibilities of participants, such as freight forwarders.

    Agency Affected: United States Agency for International Development

 

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