The Department of Veterans Affairs (VA) manages one of the largest IT infrastructures in the federal government, relying on critical systems to deliver care and benefits to millions of veterans. However, oversight of the software powering these systems remains inconsistent. According to recent analysis, VA software license management challenges continue to hinder the department’s ability to optimize spending and ensure compliance across its vast digital ecosystem.

The Government Accountability Office (GAO) has highlighted persistent gaps in how the agency tracks and reconciles its commercial software assets. While the VA spends billions annually on IT and cyber-related investments, including commercial software licenses, it has struggled to determine whether it is purchasing too many or too few licenses for its actual usage. This disconnect between procurement and deployment creates financial inefficiencies and potential security risks within the federal network.

In a January 2024 government-wide report, the GAO noted that while the VA identified its five most widely used software vendors with the highest quantity of licenses installed, it faced significant challenges in validating those numbers. Specifically, the department was not tracking the appropriate number of licenses for each item of software currently in utilize. The agency did not compare inventories of software licenses that were currently in use to purchase records on a regular basis. These findings underscore the need for stricter inventory controls and regular auditing processes.

Assessment of Key Activities

The GAO’s evaluation focused on two primary activities essential for effective license governance. The assessment revealed that neither activity was being met adequately at the time of the review. The table below outlines the specific areas where the VA fell short of best practices.

Until the VA adequately assesses the appropriate number of licenses, it cannot determine whether it is purchasing too many licenses or too few. In January 2024, the GAO recommended that the department track licenses in use within its inventories and compare them with purchase records. The VA concurred with the recommendations and stated it is taking preliminary actions to track software license usage. In early March 2026, VA officials reported that the department plans to implement initial functionality for a centralized software license inventory in late March 2026. If successful, this could be a critical first step in improving the department’s ability to track and analyze licenses across the organization. Implementation of these recommendations would allow the VA to identify opportunities to reduce costs on duplicate or unnecessary licenses.

Impact on Cloud Computing Efforts

Beyond internal tracking issues, external vendor practices have also complicated the VA’s modernization efforts. In a November 2024 report, the GAO found that restrictive software licensing practices, such as certain vendors’ processes, adversely impacted federal agencies’ cloud computing efforts, including those of the VA. These practices either increased costs of cloud software or services or limited the department’s options when selecting cloud service providers. At the time of the report, the VA had not established guidance for effectively managing impacts from restrictive practices for cloud computing or determined who is responsible for managing these impacts.

Until the VA establishes guidance and assigns responsibility for mitigating the impacts of restrictive software licensing practices, it will likely miss opportunities to avoid or minimize these impacts. The GAO made two recommendations to the VA to mitigate the impacts of restrictive software licensing practices. The department concurred with the recommendations. In May 2025, VA officials reported that the department planned to stand up a working group composed of IT and acquisition subject matter experts to identify, analyze, and mitigate the impacts of restrictive software licensing practices on cloud computing efforts by September 2026. However, it has not provided an update on the status of the working group. The GAO will continue to monitor the VA’s actions to fully implement these recommendations.

Fiscal Implications and High-Risk Status

The financial stakes are significant. For fiscal year 2025, the department planned to spend about $985 million on software, including commercial software licenses. Efficient management of these assets is not merely an administrative task but a fiscal necessity. In 2015, the GAO identified the management of software licenses as a focus area in its High-Risk report. The oversight body has also previously reported on the need for federal agencies, including the VA, to ensure better management of software licenses to prevent waste and ensure operational integrity.

This analysis summarizes two 2024 GAO reports on VA software license management, including the VA’s efforts to track software license usage and manage restrictive licensing practices. The statement also addresses the status of the VA’s actions in response to recommendations from those reports. The GAO reviewed its prior function, VA documentation related to the status of efforts to implement the recommendations, and information provided by the VA in March 2026 as part of ongoing oversight work. For more on federal IT oversight, visit the Government Accountability Office or the Department of Veterans Affairs official websites.

What Comes Next

The upcoming implementation of a centralized software license inventory in late March 2026 represents a pivotal checkpoint for the department. Success in this initial functionality deployment will determine whether the VA can move from preliminary actions to sustained compliance. The establishment of the working group by September 2026 remains a key milestone for addressing restrictive licensing practices that affect cloud adoption. Stakeholders and oversight bodies will be watching closely to see if these timelines are met and if the proposed solutions yield tangible cost reductions and operational improvements.

As federal agencies increasingly rely on complex software ecosystems, the lessons learned from the VA’s experience may inform broader government-wide policies on asset management. Readers are encouraged to share their thoughts on how improved license management could impact public sector IT efficiency in the comments below.

Disclaimer: This content is for informational purposes only and does not constitute financial or legal advice. Figures and timelines are based on reported government data and are subject to change.