Dems charge federal contracting rife with abuse

Troubled contracts account for $746b, Lockheed alone earns $25b from government, and corruption is rife, Democratic report says.
Written by ZDNet UK, Contributor on
Democrats are charging that federal procurements are out of control, fueld by mismanagement and corruption, WashingtonTechnology reports. A report prepared for Rep. Harvey Waxman, senior Democrat on the House Government Reform committee, identified 118 problematic contracts collectively worth $746 billion. The contracts had significant overcharges, wasteful spending and management. A few of the worst cases:
  • $10 billion to Accenture Ltd. and partners for the U.S. Visitor and Immigrant Status Technology;
  • $292 million to Aegis Defence Services Ltd., for Iraq reconstruction services;
  • $40 million to Akima Site Operations LLC for portable classrooms for post-Katrina Mississippi classrooms.

The report complains that the largest federal contractor, Lockheed Martin Corp., earned $25 billion in government payments in 2005—an amount larger than the combined budgets of the departments of Commerce and the Interior, the Small Business Administration and Congress combined. The fastest growing federal contractor between 2000 and 2005 was Halliburton Co., whose procurement revenues increased from $763 million in 2000 to nearly $6 billion in 2005. As is well known, Vice President Dick Cheney chaired Halliburton before taking office.

“Under President Bush, the federal government is now spending nearly 40 cents of every discretionary dollar on contracts with private companies—a record level,” the report states. Federal contracts have become the fastest-growing component of federal discretionary spending.

Furthermore, mismanagement in federal contracting is widespread, with increases in noncompetitive contracting, inadequate oversight, abuse of contracting flexibility and poor contract planning, the report states. For example, noncompetitive and sole source awards more than doubled, going from $68 billion to $145 billion from 2000 to 2005.

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