DOD aims to rein in spending on IT services contracts; GSA tech arm faces more workforce cuts

Secretary of Defense Pete Hegseth signed a memo Thursday ordering the termination of several IT services contracts and directing the Pentagon’s chief information officer to draw up plans for in-sourcing, among other measures. The aim is to “cut wasteful spending” and “support the continued rationalization” of the Defense Department’s IT enterprise, Hegseth wrote. The move comes amid a broader push by the Trump administration to implement Department of Government Efficiency (DOGE) initiatives across federal agencies. Hegseth’s new memo to senior Pentagon leadership ordered the termination of contracts affecting a variety of DOD components, including a Defense Health Agency contract for consulting services; an Air Force contract to re-sell third party enterprise cloud IT services; a Navy contract for business process consulting services; and a Defense Advanced Research Projects Agency (DARPA) contract for IT helpdesk services. In a video released on social media touting these DOGE-related efforts, Hegseth estimated that those contract terminations would save the Pentagon approximately $1.8 billion, $1.4 billion, $500 million and $500 million, respectively.

Another round of General Services Administration workforce cuts is hitting Technology Transformation Services, specifically within its Integrated Award Environment (IAE), Solutions, and Office of Regulatory and Oversight Systems (OROS) programs, sources confirmed to FedScoop. Under TTS, the Solutions platforms and services, front office, public experience and accelerators teams were all affected by the reductions, according to a source with knowledge of the situation. However, programs that are safe from the current — and widespread — reductions in force include FedRAMP, Login.gov and Cloud.gov, sources said. Additionally, TTS consulting, fellowships and front office are untouched as well.

The Daily Scoop Podcast is available every Monday-Friday afternoon.

If you want to hear more of the latest from Washington, subscribe to The Daily Scoop Podcast  on Apple Podcasts, Soundcloud, Spotify and YouTube.