The Department of Veterans Affairs has spent $51.7 billion since 2022 out of a fund built to make good on the PACT Act’s promise to veterans exposed to burn pits, Agent Orange, and every other slow poison the military handed out alongside a rifle. Congress just added another $52.7 billion for FY2026. And according to a new VA Office of Inspector General audit, the Veterans Benefits Administration cannot say with confidence how many people it actually pays out of that fund, let alone what any of them do all day.
The Missing Forty-Three
Every six months, VBA is supposed to run a recertification process, essentially a roll call, to justify the continued need for central office staff hired using the Toxic Exposures Fund. It is the kind of housekeeping exercise that exists precisely so nobody has to ask, months later, “wait, who are we paying and why.” In FY2025, VBA’s own recertification authorized 43 fewer employees than HR Smart, the department’s official personnel system, actually showed drawing pay from the fund at the same time.
Forty three people is not a rounding error. When OIG asked about the gap, VBA officials said their goal was to reduce the number of fund supported support staff, a phrase that answers a question nobody asked and dodges the one that matters. It took a VBA employee confirming, after OIG presented its findings, that the agency had simply been paying for more central office staff than it had ever authorized. VBA’s response has been to announce it will stop charging central office staff to the fund altogether, which solves the embarrassment without explaining how it happened or for how long.
That last part matters. Recertification has run since October 2023. Four different chief financial officers have cycled through VBA’s top finance job since the estimation methodology was published in December 2023, a level of turnover that the audit itself flags as a reason nobody was ever assigned to keep the paperwork straight. Leadership musical chairs is a familiar VA excuse; it is less familiar to see OIG connect that turnover directly to money moving without anyone responsible for watching it move.
A Fund Nobody Can See Into
Here is the part that should worry veterans more than the staffing math. VBA’s inability to reconcile who it pays traces back to something more basic. VA’s computer systems cannot tell PACT Act related work apart from ordinary work in the first place. Not approximately. Not unless someone manually estimates it. VBA officials told OIG flatly that none of VA’s systems are configured to track Toxic Exposures Fund data and services separately, and that VA has no activity based cost accounting capable of tying a given employee’s actual tasks to a given funding stream.
That is not a footnote to the staffing failure; it is the mechanism that made the staffing failure possible. If a system cannot tell you whether an employee’s workload is PACT Act related, it certainly cannot tell you whether that employee should still be on the payroll under that fund six months from now. The recertification process was supposed to be the human patch for a technical gap. The patch failed in exactly the way you would expect a manual workaround to fail, quietly, for at least one full cycle, until an outside auditor forced the count.
VHA has the identical hole, dressed slightly better. None of its systems can track individual episodes of toxic exposure care either, so VHA built its own workaround, called expenditure transfers, to shift the money between accounts after the fact. That workaround produced its own paper trail of errors, about $371,000 misapplied to the wrong accounts, including one facility that charged research costs to a medical services account explicitly reserved for patient care. VHA caught and fixed it, and corrected a second error a facility flagged on its own once auditors were already in the building. VBA did not catch its own gap; OIG did, and only after VBA’s own recertification numbers failed to match what HR Smart had been showing all along.
Reconciliation Is Not a Software Feature
OIG’s four recommendations amount to VA promising to build the tracking apparatus it should have had before it started spending $51.7 billion. VBA is now finalizing an actual cost estimation methodology, four years and four CFOs after the fund launched, and has committed to properly coding employees in HR Smart by October. VHA is promising quarterly sampling of its expenditure transfers, which is a reasonable fix for a problem that only exists because the underlying systems cannot do the job automatically.
None of this required forensic accounting. It required VA to build accounting systems that can distinguish one funding stream from another, a capability most mid sized nonprofits manage without a $52.7 billion appropriation. Instead, VA ran a specialized, congressionally mandated benefit for four years on spreadsheets, proxies, and an honor system recertification that nobody was checking.
The department has now concurred with every recommendation and set target completion dates stretching into 2027. Veterans exposed to toxic substances during their service are entitled to more than a promise that the tracking will eventually exist. They are entitled to a department that could already answer the question OIG had to ask for them: who, exactly, is this fund paying, and for what.
