Government Accountability Office warns DHS will not realize $10.5 billion in potential savings after canceling contracts
The GAO noted that a significant portion of the services and goods covered by the terminated contracts remained necessary and were procured through other channels.
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The Department of Homeland Security (DHS) will not fully realize the $10.5 billion in potential savings it reported after canceling hundreds of federal contracts, the Government Accountability Office (GAO) concluded in a report published on September 3.
The GAO noted that the DHS estimate overestimates the costs that will actually be avoided, since canceling a contract does not necessarily eliminate the need for the goods or services it covered.
According to the agency, 95% of that $10.5 billion corresponds to 30 contracts related to information technology services and equipment. Although the contracts were canceled, DHS continued to need those resources and, during fiscal year 2025, allocated more than US$1.7 billion through other government contracts to meet those requirements.
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The cancellations came after President Donald Trump ordered federal agencies to review contracts to reduce or reallocate public spending. In March 2025, DHS began a review of more than 17,000 contracts.
DHS terminated 438 contracts
However, the GAO cautioned that even those savings may diminish if DHS reallocates resources to perform the same work through other contracts. Therefore, the agency concluded that the actual savings will be less than the US$10.5 billion reported as potential savings.
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