White House cuts $400 million in aid for state unemployment systems

The White House is terminating $400 million in funds for states meant to modernize their unemployment insurance systems.Why it matters: These systems fell apart when unemployment soared in the pandemic, leading to rampant fraud and delays for beneficiaries.Without updates, similar problems could be on tap for the next recession.Zoom out: Congress authorized the money in the $1.9 trillion coronavirus relief bill passed in 2021. Congress allocated $2 billion for the efforts, later cutting that funding in half.Those funds were wasted on equity projects, but only a fraction of the money appears to have been devoted to such measures, according to the Labor Department, which sent a notification letter to Congress last week to let lawmakers know "these grants are being terminated."About 28% of the funds granted to states, $219 million, were used specifically for equity, as outlined in a Labor Department report.In this case, "equity" is a term meant to describe efforts to make the unemployment insurance system easier for people to use and access, perhaps not what is typically considered DEI.Efforts to promote equitable access to unemployment insurance "include eliminating administrative barriers to benefit applications, reducing state workload backlogs, improving the timeliness of UC payments to eligible individuals, and ensuring equity in fraud prevention, detection, and recovery activities," according to the report.Follow the money: $204 million was awarded for IT modernization, $134 million for fraud detection, and $93 million for system integrity, such as combating fraud and strengthening ID verification.The IT funds have been spent more slowly while states get projects underway, says Andrew Stettner, who led the modernization efforts during the Biden administration."When I left in December, states had spent about $100 million of the $219 million specifically for equity but only $2 million of the $204 million for IT," says Stettner, who is now director of economy and jobs at the Century Foundation. 18 states are working on updates to their systems, he says.Pulling this aid will be devastating for the states just getting started on these projects. "States were in the middle of all the planning and procurement. Now they're really holding the bag for finishing," Stettner says.The other side: The grants were "squandered" on "bureaucratic and wasteful projects that focused on equitable access rather than advancing access for all Americans in need," the Labor Department says in an emailed statement to Axios."We're committed to ensuring our unemployment system is free from fraud and abuse, and we look forward to partnering with state workforce agencies on real solutions that meet the needs of American workers."The bottom line: In an effort to combat fraud, the Labor Department has pulled back money from states meant to help combat fraud.

Comments

World news

Trump: 'Not my decision' to bring Kilmar Abrego Garcia back from El Salvador

washington times

Comments

Similar News

To Berlin’s relief, Musk — not Merz — got slammed during White House visit

In this White House WWE battle there was only going to be one winner

The White House adviser who helped fuel Trump-Musk feud

Merz Cracks the Trump Code With Friendly White House Meeting

Trump Tower is throwing a Pride month party for LGBTQ+ Republicans despite White House dodging events

Biden adviser’s brutal two-word verdict after Karine Jean-Pierre’s ‘Broken White House’ defection

Trump scorns Merkel legacy during new German chancellor’s White House visit

Trump to test German Chancellor Merz on trade, Ukraine war at White House meeting

Elon Musk ‘was butthurt’ after string of White House humiliations

Trump is ‘losing patience’ with Musk’s criticism as president reposts mogul’s leaving the White House message

Elizabeth Warren claims Musk enriched himself to the tune of $100B during his time in the White House

Trump will meet German Chancellor Merz at the White House. Here's what to know

AFP should take over NT police investigation into Kumanjayi White’s death, Labor MP says

Ros Atkins on... The White House claims on BBC Gaza coverage

Friedrich Merz, Germany’s Chancellor, Heads to Meet Trump at White House

'We're going to clean this up:' White House on the future of Canadians going to Harvard

Homeland Security hits back at claims ICE agent at Martha’s Vineyard has ‘white supremacist’ tattoo

Why the White House is singling out the BBC for criticism

Official White House X account targets Boulder attack suspect’s family with deportation threat

BBC rejects White House claim it removed Gaza story

World news

Trump: 'Not my decision' to bring Kilmar Abrego Garcia back from El Salvador

Vladimir Putin frontline shambles as deserters ‘gun down’ official

Panic in Spain as it announces new crackdown on overtourism

Polling on Elon Musk glaring red light for Republicans

Man killed wife and son, 7, before turning gun on himself after becoming depressed over ‘unemployment,’ family says

Stephen Miller calls mass LA protests against ICE raids an ‘insurrection’ as unrest continues

The tiny sport stirring up a big controversy in Spain

Police officer accidentally shot and killed by her colleague in Chicago

Small sport stirs up controversy in Spain as Basque Country makes its international debut

More bodies of executed civil war-era prisoners uncovered under Greek city park

Chaos erupts at Paramount Home Depot as protesters confront immigration agents

Britain is ALREADY at war with Russia and ‘we are in pretty big trouble’ admits defence expert in bombshell warning

Woman, 30, shot dead by armed cops after ‘attacking two people with knife’ in square used for Oktoberfest

Eight-year-old boy found starved and murdered in loft and left in a rubbish bag

What to know about counterprotests to Trump's June 14 parade

U.K. judge warns of risk to justice after lawyers cited fake AI-generated cases in court

‘He’s a battler’: Veteran Corey Perry playing key role for Oilers in Stanley Cup final

Trump says Musk could face ‘serious consequences’ if he backs Democrats

Six killed by Israeli gunfire near Gaza aid site, Hamas officials say

Death row inmate's final meal so controversial it's now banned

Humiliation for Putin as £74m fighter jet erupts in fireball after new Ukraine's attack

Trump National Golf Club in Bedminster responds after receiving devastating health department grade

Musk may indeed have won Trump the election. But his Wisconsin cheesehead humiliation proved he’d lost the juice

Chicago cop shot and killed by fellow officer in friendly fire incident during tactical operation

Chabria: ICE arrested a California union leader. Does Trump understand what that means?

Teen, 19, dies after viral TikTok ‘dusting’ challenge went wrong leaving family ‘utterly devastated’

Deadly Russian strikes condemned as 'savage' - as dozens more injured in Ukrainian city

Carney says Canada to focus on peace, energy security and new partnerships at G7 meeting

Kilmar Abrego Garcia back in U.S., charged with human smuggling as lawyers vow ongoing fight

Alberta buying U.S. alcohol again, months after pause meant to fight tariffs

Police investigate possible poisoning after man dies, woman hospitalized north of Montreal

Trump says relationship with Musk is over

Hamlin undeterred by ruling siding with NASCAR in lawsuit filed by Jordan-owned 23XI and Front Row

Bucharest gay pride march turns 20 as LGBTQ+ Romanians face growing hostility from right-wing groups

Vegetable sculpture contest features a squash Donald Trump and a papal 'cornclave'

American father wanted for allegedly killing his three daughters may be trying to flee to Canada

Parents of Brit backpacker, 24, facing 20 years in prison over fatal e-scooter crash fly to Australia

England player ratings as 4/10 Palmer sums up Tuchel’s muddled tactics

England jeered as Roy Keane criticises ‘bored’ players in laboured Andorra win

Murder suspect 'marries teen model girlfriend in secret wedding' while on run from police

Stanley Cup final: Marchand plays hero for Panthers in Game 2 win over Oilers

Prairie wildfires having air quality impact on several provinces

Russian attacks on Ukrainian city of Kharkiv kill 4

Health Canada warns consumers not to inhale ‘laughing gas’ recreationally

Gender stereotypes shape reactions to Trump-Musk outburst

Elks open regular season against Lions in Vancouver on Saturday

Calgary Stampeders set to start new CFL season with Vernon Adams Jr. at QB

Liberia's ex-speaker charged with arson over parliament fire

Russian attack on eastern Ukrainian city of Kharkiv kills 3, wounds 21

Why were so many Thai farmers among the hostages held by Hamas?

New powers demanded to tackle Russia's 'shadow fleets'

Donald Trump issues stark warning to Elon Musk as furious row continues

JD Vance reveals how Donald Trump really feels about Elon Musk spat

The incredible £24.8bn transport mega project that will transform Europe

Katie Miller, Stephen Miller’s wife, in a ‘tricky situation’ after Musk and Trump’s falling out

Man charged with targeting MLB and NFL stars in home burglary spree

More alleged child porn victims of former New Pornographers drummer come forward, authorities say