SSA details over $800 million in savings in fiscal 2025
The Social Security Governance (SSA) has announced a plan to save over $800 million for fiscal year 2025 by implementing various cost-saving measures. These include reevaluating contracts and grants, reducing payroll through hiring freezes, and cutting down on overtime, which collectively account for approximately $550 million in savings. Additionally, the agency aims to minimize expenses in data technology by canceling nonessential contracts, which will save around $150 million, and by making notifications available online, thereby reducing postal costs for over 5 million customers.
Specific savings initiatives include the cancellation of approximately 60 office leases, which will result in $4 million in annual rent savings, and procedural changes that eliminated $3 million through reduced paper notices. The SSA’s acting Commissioner, Lee Dudek, emphasized that these changes are necessary for overcoming inefficiencies and improving service delivery, as the agency has historically functioned without significant adaptation to it’s operational processes.
However, ther have been concerns surrounding the Department of Government Efficiency’s reports of savings, with scrutiny directed at their credibility and methodology of tracking contract cancellations, highlighting a potential lack of coordination and accuracy in their claims. This situation has brought additional attention to the SSA’s efforts to ensure fiscal prudence and openness within its operations.
Social Security Administration announces more than $800 million in savings
The Social Security Administration has identified $800 million in cost savings for fiscal 2025.
The savings come from the SSA reevaluating contracts and grants, payroll, information technology, consolidating office space, and making policy changes to travel and printing.
“For too long, SSA has operated on autopilot,” acting SSA Commissioner Lee Dudek said in a statement. “We have spent billions annually doing the same things the same way, leading to bureaucratic stagnation, inefficiency, and a lack of meaningful service improvements. It is time to change just that.”
The agency found the bulk of its savings from placing a hiring freeze on SSA Disability Determination Services and reducing overtime pay. A total of $550 million was recovered.
The SSA’s cancellation of nonessential contracts reduced the budget of the agency’s Information Technology Systems by $150 million.
Another $15 million in contracts and $15 million in grants were also canceled.
The SSA also made SSA-1099 and SSA-1042 notices available online, leading to 5.4 million customers opting out of paper notices, a measure avoiding $3 million in costs. The agency also reported saving $28 million by moving to centrally print and mail notices rather than having front-line staff print and mail them locally.
The SSA also canceled over 60 leases, which will yield $4 million in annual rent savings.
Meanwhile, the Department of Government Efficiency has struggled with false reports of savings, erasing $4 billion from its “wall of receipts.”
On Sunday night, the group removed 1,000 contracts it had claimed to cancel from its website, representing more than 40% of all contracts listed on its site last week.
WHAT IS DOGE? WHAT TO KNOW ABOUT THE DEPARTMENT OF GOVERNMENT EFFICIENCY
Some of these contracts DOGE has taken credit for were either already canceled under the Biden administration or even the Bush administration.
“Overall, there’s a certain randomness to it,” Jessica Riedl, a senior fellow at the Manhattan Institute, a conservative think tank, told the New York Times. “It seems like DOGE had certain agencies pull together some random lists of contracts that may or may not currently exist anyway, and then, without checking the data very well, uploaded it onto a website and summed up the amounts. It doesn’t seem to be centrally coordinated.”
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