GAO: Missed Opportunities in Cutting Contractor Spending

Federal agencies reported substantial savings in meeting President Obama’s direction to cut contractor spending, but the Government Accountability Office found missed opportunities to high-risk contracts, along with problems with reported data.

The study came about following President Obama’s 2009 executive order calling for the 24 largest agencies to save $30 billion annually in contracting by fiscal year 2011 and reduce the share of dollars obligated under new high-risk contracts by 10 percent in fiscal year 2010.

“The extent of savings resulting from OMB’s initiative is unclear. While OMB reported that agencies reduced contract spending by $15 billion from fiscal year 2009 to fiscal year 2010, this analysis was based on government-wide spending trends and not solely due to the savings initiative. GAO found billions of dollars in overstated and questionable savings, reported by civilian agencies in early fiscal year 2011,” the report says.

The GAO report says that the Office of Management and Budget continue to focus on the savings initiative and clarify how it aligns with other new initiatives, clarify guidance on how agencies’ initiatives are defined and reported, and expand the initiative to include all high-risk actions.


GAO also recommends that OMB report on the results of the initiative through fiscal year 2011. The Office of Federal Procurement Policy expressed concern that the report presents an incomplete picture of savings, especially at the Department of Defense. GAO disagrees and believes the report accurately portrays the scope and results of agencies’ efforts under the initiative. OFPP agreed to adopt, where appropriate, GAO’s recommendations regarding recording and methodological concerns.

FEDERAL CONTRACTING OMB’s Acquisition Savings Initiative Had Results, but Improvements Needed

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