Anti-pattern 7.5
Savings Nobody Can Evidence
Funding is approved on the promise of savings that nobody agreed how to measure.
In This Context
Money outside the annual budget is hard to get, and a proposal that promises to pay for itself is much easier to approve. Forecasting a saving is far easier than evidencing one. The US Technology Modernization Fund (TMF) was set up as a central pot outside the annual budget cycle, lending money to federal agencies for modernization, to be repaid from the savings the projects produce.
Therefore
Funding is approved on forecast savings, without agreeing which cost line they will appear on, what the baseline is, or when they will show up.
Consequently
- The money arrives outside the annual cycle, as intended.
- GAO reported in 2026 that TMF projects had realized about $13.5 million in savings, against about $1.06 billion expected, and its earlier reviews found most projects’ savings estimates unreliable.
- In 2021, GAO reported that the fund cost more to run than it collected in fees.
- After a large injection of cash in 2021, the repayment rules were loosened to allow partial or minimal repayment for projects whose savings were hard to realize, so a fund meant to pay for itself became more like an ordinary central budget.
- A saving that can’t be evidenced counts against the next proposal too.
- A better approach: Baseline Before You Claim.
Seen In
Chapter 16, “Make the Numbers Survive Being Checked” (GAO-26-107737 footnote); Chapter 17, “Central Budget” (GAO-22-105117 and the GSA release, in footnotes). Facts as given there.