• on Sep 1st, 2014 in Delivery & Collection | 6 comments

    The Social Security Administration (SSA) is going back to the mail, bucking the digital trend it embraced just 3 years ago. This month, SSA will again start mailing paper benefit statements to people at 5-year intervals.

    In 2011, under budget pressure, SSA stopped mailing paper statements that provide an estimate of future Social Security earnings. The effort certainly saved money, about $70 million a year. But only about 11 million people – or just 6 percent of all workers – registered online to view their statements. This low participation heightened criticism that people weren’t getting valuable reminders of what they can expect to get back in the future from payroll taxes.

    Advocacy groups for older Americans and the paper industry pressured the agency to resume mailing paper statements. They noted that millions of Americans don’t have Internet access and thus have no way to verify the accuracy of their Social Security benefits or to plan for retirement.

    If you are one of the 11 million who registered to view your statement online, you won’t get a paper statement mailed to you. But everyone else will get a mailed statement when they are ages 25, 30, 35, 40 and so on.

    SSA’s return to hard-copy statements suggests that some types of communication still need to be mailed. Do you agree? Or, as broadband expands, can most communications eventually move online for convenience and cost savings? What types of statements do you prefer to receive by mail? Are there statements you prefer to get online? 

  • on Aug 25th, 2014 in OIG | 1 comment

    About 90 percent of the data in the world today has been created in the past 2 years alone, according to IBM. Yes, we live in the era of Big Data.

    Data is vital to our work as an OIG. We use data analytics – including data mining, risk assessment models, and predictive analytics – to help focus our audits and investigations on high-risk areas of the U.S. Postal Service that yield the largest financial impact and/or efficiency improvements. For our organization, data analytics is a game-changer. Using a single data interface, investigators no longer have to comb through different programs and network folders, saving considerable time. Our predictive model lets us identify cases involving a high probability of fraud, before beginning an investigation.

    While the data game is rapidly evolving, federal laws governing data use have moved at a slower pace. The recently enacted DATA Act provides a powerful weapon in combatting fraud and waste in government by standardizing and opening up federal spending information for all to see. But agencies still face bottlenecks in uncovering fraud and abuse. Notably, the Computer Matching and Privacy Protection Act of 1988 – written before Big Data and intended as an extension of the Privacy Act – added procedural steps that agencies must follow when matching federal, state, and local electronic databases.

    Say an agency wanted to check its payroll data against the Department of Labor’s (DOL) workers’ compensation records to determine if an individual is collecting both a paycheck and a workers’ compensation check. Under the 1988 law, the requesting agency would need to draft a formal matching agreement to be reviewed by the data integrity boards at both the requesting and responding agencies (in this example, DOL). The complicated process can take 6 months or more, during which time fraud can continue.

    The Computer Matching Act was passed at a time when people were unfamiliar with computers and worried about their privacy. Privacy is still a major concern, but is privacy protection inadvertently skewed in favor of criminals? Data analytics allows investigators to root out fraud and abuse early and find those responsible before they can make a long-term habit of it. But the most effective uses of data analytics are often obstructed with administrative hurdles.

    What is the right balance between protecting federal employees’ privacy and equipping agencies to quickly detect fraud and abuse? If you accept money from the government – such as a paycheck, disability check, grant award, or contractor payment – should you expect more scrutiny? Would you be willing to share your data to help combat fraud? Or is an overabundance of protection necessary in this age of Big Data? 

  • on Aug 18th, 2014 in Post Offices & Retail Network | 164 comments

    It’s baaack.

    Network consolidation will return in January 2015, a year after going on hiatus. The U.S. Postal Service announced recently that it would resume consolidations, closing up to 82 mail processing facilities. This second phase of the network consolidations should be done prior to the 2015 fall mailing season.

    The Postal Service expects the changes to yield $750 million in annual savings and to affect about 15,000 employees. In 2012 and 2013, the Postal Service consolidated 141 mail processing facilities, resulting in cost savings of about $865 million.

    Loyal readers of our blog will recall that the Postal Service put its network consolidation plans on hold in early 2014 while it reconsidered its proposed changes to service standards for First-Class Mail. (See our blog from earlier this year on the delay.) Phase two will affect the service standards for First-Class Mail and Periodicals as well, eliminating the overnight standard for most First-Class Mail. Periodicals service standards would range from 3 days to 9 days, versus the current 2 to 9 days.

    The Postal Service says eliminating excess capacity through consolidation is one of the few options it has to cut costs. Consolidation will also allow the Postal Service to establish a “low-cost, technology-centric delivery platform necessary to serve the mailing and shipping industry for decades to come.”

    Still, the planned consolidations are likely to rankle some. At least one postal union has already come out strongly against the plan, saying it will degrade service and lead to mail delays. It intends to vigorously fight the closures. On the other hand, industry has generally supported Postal Service efforts to reduce costs and improve efficiencies, as long as service isn’t irreparably harmed.

    We welcome your thoughts. Should the Postal Service continue with consolidations given the decline in mail volume and the potential cost savings? Or should the Postal Service first explore ways to use the excess capacity to provide services that might yield additional revenue sources, such as warehousing or other logistics services? 

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