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New contracting guidelines mean more gov't hires

By Ed O'Keefe

The size of the federal workforce will grow even more next year, as agencies and departments will need to increase the number of contracting officers by at least 5 percent, according to new guidelines issued Tuesday by the Office of Management and Budget.

President Obama earlier this year vowed to save at least $40 billion annually by cutting non-competitive contracts and ending the use of contractors to conduct certain government functions.

Despite that pledge, the new guidelines do not define the meaning of "inherently governmental," the term used to describe government functions that contractors could no longer conduct. OMB expects to define the term by year's end, according to a spokesman. Officials privately describe the process as complex, acknowledging that any definition will inevitably mean the loss of billions of dollars in revenue for contractors.

Agencies must submit plans to hire more workers responsible for government contracting to OMB by Monday. Some agencies may experience a higher increase in their acquisition workforce.

The guidelines also instruct agencies to slash spending on "high risk" contracts by 10 percent this fiscal year. Such agreements are considered wasteful, redundant, noncompetitive or poorly managed. Those cuts are in addition to a mandated 7 percent cut in total government contracts over the next two years.

The new guidelines will be the subject of a Wednesday afternoon hearing of the Senate subcommittee on contracting oversight. The panel's chair, Sen. Claire McCaskill (D-Mo.), plans to express her concerns about how the new guidelines address the issue of accountability, according to her spokeswoman.

Sen. Joseph I. Lieberman (I-Conn.), chairman of the Senate Homeland Security and Governmental Affairs Committee, applauded the administration's plans to focus on hiring more contracting officers.

"Congress needs to recognize that we will continue to see an alarming waste of taxpayer dollars if we don’t ensure that agencies have employees with the right skills to manage these purchases," Lieberman said in a statement.

"Pressure from the very top will help keep the heat on agencies to eliminate contracting practices that waste precious taxpayer dollars.”

Leave your thoughts in the comments section below.

By Ed O'Keefe  | October 27, 2009; 5:30 PM ET
Categories:  Administration, Contracting  
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An from my own personal experience of as working as a ncdot state highway inspector where that federal highway funds were being utlizied in the construction of certains highway project inside of north carolina. i had the oppurnity to personall witness the waste fraud an abuse of several million dollars of taxpayers monies an i was in fact responsible for the recovery of approxmate 1.2 million dollars of taxpayers dollars by the state of north carolina thank you

Posted by: | October 27, 2009 6:09 PM | Report abuse

The fuel that has and will drive the proposed changes cited by the OMB Memo is the acquisition personnel. However, in my federal experience in both civilian and DoD agencies, in both pre-award and post-award functions, the formal and in-house training needed for the required skills and judgment of acquisition personnel is uneven and not uniformly funded among the federal agencies. This circumstance has been compounded by 77 changes in 10 years to the Federal Acquisition Regulations which acquisition personnel are required to be proficient with. I was fortunate to begin my career as an intern performing post-award contract administration with cross-functional training among specialists assocaited with the myriad of oversight and monitoring duties after contract award. That training was the cart BEFORE the horse that became the foundation of sound contract judgment I used as a Contract Specialist and Contracting Officer. Unfortunately, we have seen the consequences all too often on the front pages of newspapers when there is inadequate capacity of skilled acquisition personnel with business judgment.

Posted by: gdma | October 28, 2009 12:13 AM | Report abuse

This is another example of a poorly planned "solution" to an inadequately analyzed problem. Hiring more people will do nothing to improve a poor process; it will more likely have the opposite affect and increase waste. And arbitrarily deciding to cut noncompetitive contracts won't necessarily result in a better deal for the taxpayers. Truly successful organizations establish long term relationships with their suppliers. Constantly putting contracts out for bid can inhibit long term supplier relationships and lead to increased costs and lower quality products and services in the long run.

Posted by: bigtom6156 | October 28, 2009 10:02 AM | Report abuse

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