The Trump administration has withdrawn its attempt to block $10 billion in childcare and social support funds for five Democratic-led states, marking another setback in its efforts to restrict federal funding over claims of fraud and alleged opposition from political rivals.
In early January, the administration announced the freeze amid a high-profile federal investigation into alleged fraud involving federal social service programmes in Minnesota, but a federal judge in New York paused the move days later.
Trump has made tackling fraud a major focus of his second term, turning the issue into a key theme ahead of the November midterm elections as Republicans work to retain control of Congress. Although a government analysis suggests that hundreds of billions of dollars are lost to fraud each year, critics of the president say many of the allegations are politically motivated and not backed by sufficient evidence.
The Department of Health and Human Services had attempted to suspend $7.4 billion in funding for the Temporary Assistance for Needy Families (TANF) programme, which provides financial support to households, along with nearly $2.4 billion allocated for the Child Care and Development Fund and approximately $870 million from the Social Services Block Grant.
The move targeted California, Colorado, Illinois, Minnesota, and New York, where the programmes provide support to large numbers of low-income families. The states swiftly filed legal action, arguing that the administration’s decision was politically motivated and unconstitutional.
In a letter to the states last week, HHS informed them that the restrictions placed on their access to federal funding would no longer apply. The agency also withdrew its requests for explanations and additional information, including reviews into whether benefits had been provided to ineligible immigrants.
