VA Budget Shortfall Of $12 Billion To Cause More Budget Complications For 2025

The Department of Veterans Affairs (VA) is facing a $12 billion shortfall, and it is not making things easier when it comes to the government budget for 2025. There is already a debate between parties on how to approach the budget for the succeeding year, which may cause more complications than solutions.

According to The Hill, there is an existing disparity between the funding bills crafted by House Republicans and what Democrats say should be spent, taking into consideration a deal made between the White House and the GOP leadership last year. Lawmakers say that the shortfall in the VA budget simply means more headaches coming.

"How this all gets resolved is super complicated," said former Senate Democratic budget aide Zach Moller. "Does this $12 billion come from other things in VA?"

Just last month, the VA requested Congress to allocate $3 billion to answer for mandatory benefits. The said amount would cover the fiscal year, which ends in September. Aside from the $3 billion, it also requested $12 billion as additional funding, which would be allocated for medical care for the year 2025.

Because of the immediacy of the VA's call, there was bipartisan momentum in Congress to answer for it, or else millions in veterans' benefits would be at risk in the coming weeks. In the event that the funding does not reach VA by Sept. 20, the compensation of veterans, as well as their pension benefit payments, would also be delayed in October.

According to Sen. John Boozman (R-Ark.), there would only be checks if they get to fix the issue in September. He also said that both sides find the issue as something that needs to get done.

Republicans scrutinized the shortfall, criticizing the way that the VA has been managing funds. Such has stalled the effort to expedite the fix that was meant to correct the $3 billion shortfall.

Based on the Fiscal Responsibility Act (FRA), there is a funding cap for non-defense programs for 2025, pegged at approximately $711 billion. The FRA was the result of the deal between President Joe Biden and Kevin McCarthy (R-Calif.), the House Speaker at the time.

UPenn stated on its website that the FRA will reduce by $1.3 trillion non-interest spending. Some members of Congress are having a hard stance against the requested funding of the VA.

Bobby Kogan, senior director of federal budget policy for the Center for American Progress, stated that the VA medical spending has to live with the budget cap for non-defense discretionary.

"So, all else equal, whatever was going to happen for this coming year, that means there's $12 billion less room for everything else," he said.