The bill codifies an executive order that now requires agencies to estimate and report on improper payments, and requires annual reports on improper payments. It requires the Office of Management and Budget to identify programs at risk of making improper payments, and set targets for reducing these payments.

It also sets up a Do Not Pay initiative, which requires agencies to examine several databases that contain information about illegitimate entities that should not be paid.

The bill was introduced earlier this year by Rep. Edolphus Towns (D-N.Y.), who said it is needed to help ensure that ineligible entities are blocked from receiving billions in taxpayer funds.

"As stewards of taxpayer dollars, we must be certain that we maintain the integrity of the programs established to help those in need," Towns said in February when he introduced the bill. "This bill takes important steps toward ensuring programs are only benefiting those who are eligible."

Towns is the ranking member of the House Oversight and Government Reform subcommittee on Government Organization, Efficiency and Financial Management. The chairman of that subcommittee, Rep. Todd Platts (R-Pa.), is one of 20 co-sponsors of the bill, and is the only Republican on it.

"Focusing on eliminating improper payments goes to the very heart of government accountability," Platts said when the bill was put forward. "When citizens pay their taxes, they have an absolute right to expect that their tax dollars are being spent responsibly and appropriately."

In July 2011, Sen. Thomas Carper (D-Del.) introduced the first version of the bill, S. 1409, along with Sens. Scott Brown (R-Mass.) and Joseph Lieberman (I-Conn.).