Labor Secretary Lori Chavez-DeRemer revealed that the Department of Labor will be sending more than $1 billion in unused pandemic-related funds back to taxpayers. The move aligns with the Trump administration’s broader efforts through the Department of Government Efficiency (DOGE) to curb excess spending and improve accountability across federal agencies.
According to a press release from the department, $1.4 billion in leftover COVID-19 relief funds will be “returned to taxpayers through the U.S. Department of Treasury’s General Fund,” while steps are underway to retrieve the additional $2.9 billion that remains.
“The roughly $4.3 billion was intended for states to use for temporary unemployment insurance during the pandemic,” the press release states. “Instead, several states continued spending millions of dollars despite no longer meeting necessary requirements, which was uncovered in a 2023 audit conducted by the department’s Office of Inspector General.”
The department explained that the funding in question was originally allocated through the Coronavirus Aid, Relief, and Economic Security (CARES) Act, passed in March 2020. Its purpose was to expand unemployment benefits to Americans who were unable to work due to the pandemic.
Although the program was officially terminated in 2021, a subsequent review in 2023 uncovered that four states had continued drawing from the funds. The audit concluded that these states did so “despite not meeting program requirements,” and identified more than $100 million in questionable expenditures.
“There’s no reason leftover COVID unemployment funds should still be collecting dust,” DeRemer told Fox News Digital in a statement. “I promised to look out for Americans’ hard-earned tax dollars, and we are delivering at the Department of Labor.”
“Any money still sitting around for pandemic-era unemployment funds is a clear misuse of Americans’ hard-earned tax dollars,” Chavez-DeRemer said in the press release, adding that she is “rooting out waste to ensure American Workers always come First.”
Deputy Secretary of Labor Keith Sonderling echoed her sentiments, expressing disapproval at the lack of oversight that allowed this situation to persist.
“It’s unacceptable that billions of dollars went unchecked in a program that ended several years ago.
In a huge win for the American taxpayer, we’ve clawed back these unused funds and will keep working to eliminate waste, fraud, and abuse.”
This latest development follows a message DeRemer shared with department staff upon assuming her role last month. In that internal communication, she pledged to enforce Trump’s executive orders and collaborate with DOGE to target inefficiencies.
“Under the leadership of President Trump, our focus remains on promoting job creation, enhancing workforce development, and ensuring safe working conditions, wages, and pensions so that every American has the opportunity to succeed,” DeRemer said to employees in the memo. “I challenge each of you to actively engage with your teams to identify innovative solutions that can help us achieve our goals.”
Chavez-DeRemer emphasized that the department must fully support the Trump administration’s vision by ensuring that all funds are spent responsibly. She stressed the importance of cutting waste, minimizing unnecessary expenditures, and making the most of government resources.
The department, she said, “must focus on practicing fiscal responsibility, reducing unnecessary spending, and optimizing our resources to ensure that taxpayer dollars are utilized effectively.”
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