GAO Report Questions Army's Use of Contractors

Ann All

I blogged back in June about concerns surrounding the growing practice of federal government agencies employing contract workers. Several studies seemed to indicate that, rather than boosting efficiency and saving the government money, the practice suffered from a lack of oversight and inflated costs.


A recent report from the Government Accountability Office offers more fodder for concern. According to a Washington Post story about the report, the Defense Department last year spent $158.3 billion on services, more than it spends on supplies, equipment and major weapons systems. The number marks a 76 percent increase over the past decade.


The GAO focused on the Army Contracting Agency's Contracting Center of Excellence, which provides procurement services for 125 divisions at the Pentagon. Forty-two percent of the center's procurement specialists are contractors, a jump of 24 percent from fiscal 2005. This heavy use of outside companies is worrisome because of a possible loss of federal control and accountability over government programs, says the report.


Most of the specialists are employed by a single private company, CACI International of Arlington, Va., one of the 50 largest contractors in the U.S. The report found that, in many cases, the difference between government employees and contract workers largely boils down to "their different badge color" and their salaries. Some contractors make $74.99 an hour, according to the report, 27 percent more than the government workers performing the same duties.


Says Joseph Lieberman (I-Conn.), chairman of the Senate Homeland Security and Governmental Affairs Committee:

We must be assured that contract dollars are awarded so that taxpayers get the best value for their money and not to increase the fortunes of a contractor or its employees.

Army contracting officials cite "chronic difficulties" in recruiting and retaining procurement specialists, due to stiff competition from other government agencies as well as the private sector. The Washington Post reported in August that many federal workers were leaving the government's employ because they could make more money at private companies. That story mentioned Abraxas, a company run by a former CIA case officer, that has hired more than 100 former government employees over the last six years -- many of whom then were put to work as contractors on government accounts.

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Mar 28, 2008 5:15 PM Ted Nowak Ted Nowak  says:
I haven't seen the GAO report, but do have one question about what is included in the cost comparisons. If the figures quoted represent the cost for an hour of service, the employee cost should include the cost of benefits, which often exceeds the 27% rate differential. If the rates quoted reflect hourly compensation paid to the individual, then I believe the comparison is appropriate.On the issue of the increased rate of contractors within the organization, I also agree this is a significant concern. While contractors may bring outside methods and efficiencies that the employee does not, I questions whether the lack of knowledge about the corporate culture and activities present more of a detriment than a benefit. Reply
Mar 29, 2008 3:06 PM bob bob  says:
Hey Ted, Read the report, the cost of a government worker was loaded with all of the governments contributions to benefits (health, retirement, etc...) and included the overhead costs associated with the employment of those government workers. Reply

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