Press Releases

SBC Reviews Failed Retirement & Restructure Programs at SBA

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Washington, June 14, 2017 | comments

WASHINGTON – Today, the House Small Business Committee reviewed the Small Business Administration's (SBA) failed attempt to restructure the agency, particularly its use of the Voluntary Early Retirement Authority (VERA) and Voluntary Separation Incentive Payment (VSIP) Programs. The VERA and VSIP programs were created to help agencies restructure or downsize their workforce.

“The Office of Inspector General conducted an audit of SBA’s management of its VERA-VSIP program.  In its audit released just a couple of weeks ago, the OIG determined that SBA failed to achieve any of its goals.  It did not address workforce competency and agency skill gaps.  It did not decrease the average age of the agency’s workforce.  It did not address budgetary constraints to avoid a reduction in force.  In fact, apparently, the agency was facing no real threat of a reduction in force,” said House Small Business Committee Chairman Steve Chabot (R-OH).

“The VERA and VSIP options are supposed to help agencies restructure and reshape their workforces.  Yet, SBA’s workforce was left almost completely unchanged,” noted Chairman Chabot. 

A Cautionary Tale: A Review of SBA’s Failed FY 2014 Agency Restructure
Witness Testimony

“We found that while SBA made limited progress in restructuring and reshaping the workforce, it did not accomplish its stated goals of the VERA-VSIP program. As a result, SBA paid $2.1 million for early retirements for positions that were not restructured following VERA-VSIP. Overall, SBA may have been more successful in achieving its goals had it properly managed the VERA-VSIP program by developing specific and measurable VERA-VSIP goals,” said Mr. Hannibal “Mike” Ware, Acting Inspector General of the United States Small Business Administration’s Office of Inspector General.

“As the Inspector General’s audit report indicates, SBA did not carry out the 2014 VERA-VSIP properly,” said Joseph Loddo, Chief Operating Officer at the United States Small Business Administration.

“We will document the lessons learned, including in the areas of planning, implementation, results and recommended improvements. We will include all stakeholders in the process,” Loddo added.

You can view the full video of today’s hearing HERE and read the full witness testimony HERE.

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