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Union Reacts to New IRS Contract

By Ed O'Keefe

Colleague Brian Krebs reports in his Security Fix blog that the IRS has awarded a tax processing contract to a company that recently compromised the security of 1.1 million Social Security numbers and the financial data of 1.5 million payroll card holders. Not surprisingly, leadership at the National Treasury Employees Union (NTEU) is not happy.

Why? Let's put it this way: IRS privatization is to NTEU what Japanese automobiles are to the United Auto Workers -- a headache.

The federal workers union represents thousands of IRS employees and last fall strongly urged President-elect Obama to cancel the agency's private contracts. Such agreements waste taxpayer dollars and offend IRS employees, the union argued, since the rank and file believe they understand and can perform such tasks better than private firms. Last month the IRS allowed its tax collection contracts to expire and the recent FY '09 omnibus bill requires a government-wide review of all contracting to determine cost-effectiveness.

While the agency's tax collection contracts have expired, other agreements, including the one Krebs reported on, still exist.

"NTEU is very concerned about contracting at the IRS both from a taxpayer security standpoint and an efficiency standpoint," NTEU President Colleen M. Kelley said in a statement yesterday afternoon. She cited a recent Treasury Inspector General for Tax Administration report that raised questions about the fiscal prudence of the IRS' "cost plus" contracts. Such agreements require the IRS to reimburse contractors for labor costs and other time and materials expenses. (The tax processing contract highlighted by Krebs is a fixed-price, not "cost plus" agreement.)

"There are many contracts for work out there that could be done more efficiently and at less cost by federal employees," Kelley said, adding that her union will continue to raise its concerns with the IRS and Office of Management and Budget as it performs the mandated government-wide review of contracting.

By Ed O'Keefe  | April 24, 2009; 2:10 PM ET
Categories:  Workplace Issues  
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Comments

You've got to be kiddin" In older versions of A 76 the processing of taxes was held out as an example of "GOVERNMENTAL" activity that would not be contracted out. A76 is not just cost but security and efficiency of process. If this contract holds up then a BIG question comes next...why do we need the IRS at all? Contract out the whole place and its multi-billion dollar yearly budget. The honor system of government was at IRS the standard, along with ethics of the workforce. I am ashamed to say I used to work there. TIGTA get after them and get it cancelled before more damage is done!!!

Posted by: kidvid | April 24, 2009 3:17 PM | Report abuse

You've got to be kiddin" In older versions of A 76 the processing of taxes was held out as an example of "GOVERNMENTAL" activity that would not be contracted out. A76 is not just cost but security and efficiency of process. If this contract holds up then a BIG question comes next...why do we need the IRS at all? Contract out the whole place and its multi-billion dollar yearly budget. The honor system of government was at IRS the standard, along with ethics of the workforce. I am ashamed to say I used to work there. TIGTA get after them and get it cancelled before more damage is done!!!

Posted by: kidvid | April 24, 2009 3:28 PM | Report abuse

The comments to this entry are closed.

 
 
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