New law aims to avoid repeat of recent scandals at Veterans Affairs

President Donald Trump on Aug. 14 signed into law a bill that seeks to increase oversight of the Veterans Affairs Department following recent scandals involving critical skill incentives for VA senior officials and projected budget shortfalls. 

The Protecting Regular Order for Veterans Act (S. 423) prohibits the VA from providing the recruitment and retention incentives to members of the Senior Executive Service who work in its central office. 

The new law also specifies that such critical skill incentives can only go to a member of the SES on an individual basis, rather than a group, and need the approval of certain VA officials, including the assistant secretary for Human Resources and Administration, assistant secretary for Accountability and Whistleblower Protection and the department general counsel. 

Additionally, the VA will be required under the law to provide quarterly, in-person briefings to the congressional veterans’ committees for the next three years on the department’s budget and any shortfalls. 

The legislation — sponsored by Sen. Dan Sullivan, R-Alaska — aims to address two separate controversies that emerged within the VA in 2024, both surrounding the PACT Act. 

That law, enacted by former President Joe Biden in 2022, expanded VA health care and benefits to millions of veterans who were exposed to toxic burn pits during their service. As part of an effort to increase staffing, the PACT Act also established critical skill incentives for employees and applicants with “high-demand” or understaffed skills. 

VA had approved $11 million in such bonuses to nearly all senior executives in the Veterans Health Administration and Veterans Benefits Administration, due to what the VA’s inspector general dubbed an “improper and overzealous application” of the PACT Act’s provisions. Former VA Secretary Denis McDonough later apologized for the payments and recouped the incentives. 

The bonus controversy was later coupled with a projected $3 billion budget shortfall crisis within the VA, which Josh Jacobs, former undersecretary for Benefits, attributed to the department issuing more claims decisions under the PACT Act than anticipated.

Congress in September 2024 passed a nearly $3 billion supplemental for the VA after officials in July 2024 flagged that a budget shortfall could affect veteran benefits. 

However, VA officials told Congress after the supplemental funding was approved that they didn’t end up immediately needing it. The VA OIG reported in March that part of the reason why there appeared to be a pending shortfall is because VA did not include carryover funding from prior years in its calculations. 

“A contributing cause for the projected shortfall in funding was that realized prior-year recoveries — unspent deobligated funds that are available to be used for other purposes — were not included in the VBA status of funds calculations,” according to the report. “Had the realized prior-year recoveries been included in the calculations throughout the year, the monthly funding status reports would have shown a reduced risk of a shortfall by the end of the fiscal year.”

House Veterans’ Committee Chairman Mike Bost, R-Ill., said during floor remarks on July 21 that “[t]his bill is a straightforward, commonsense effort that partners with Secretary Collins and the Trump administration to establish greater accountability and oversight of career senior executives at the department. The need for this legislation comes in the wake of the critical skills incentive payments scheme uncovered by my committee during the last Congress. The days of waste, fraud and abuse are over.”

The House passed the legislation on that day by voice vote. The Senate cleared the bill in April by unanimous consent. 

The PRO Veterans Act also codifies the VA’s customer experience office, which was established in 2015 to collect feedback from veterans and their family members to improve the delivery of benefits and services. 

VA is undergoing a department-wide review of its mission and structure; although, officials said that they will not conduct large-scale reductions in force.