GovernmentExecutive.com

The Defense Department has underestimated the cost of implementing a new personnel system for civilian employees, an issue that could hamper the system's management, according to a new report by the Government Accountability Office.

Defense's November 2005 estimate that it will cost $158 million through 2008 to implement the National Security Personnel System does not include indirect costs associated with its design and implementation, the report (GAO-07-851) said. Items left out include the full salaries for civilian and military personnel charged with putting the system in place, along with the cost of general administrative services, research and technical support, rent, maintenance costs for buildings, equipment and utilities.

"Without a cost estimate that includes all costs the department expects to incur as a result of implementing the new system, decision-makers -- within DoD and Congress -- will not have the complete cost information they need to make decisions about whether adequate resources are being provided," the report said.

GAO said federal financial accounting standards hold that reliable information on costs of federal programs is essential to effective management. It is also important in helping Congress and executives make informed funding decisions.

But Defense's pervasive financial management deficiencies have been the basis for the designation of this as a high-risk area since 1995, GAO stated.

Auditors recommended that Defense define all direct and indirect costs of NSPS, prepare a revised estimate of these costs in accordance with federal financial accounting standards, and develop a comprehensive oversight framework to ensure that all funds are fully captured and reported.

Defense officials concurred with most of GAO's recommendations, but noted that the department already has launched an effort to better identify overall costs -- an effort that is not reflected in the draft report.

Defense agreed, however, to develop a revised estimate of applicable costs for implementing NSPS from fiscal 2008 to 2011. "As is true for the first estimate . . . the revised estimate could be affected by congressional changes to the authorities that govern the system," Defense said.

Congress granted the department authority in the 2004 Defense authorization act to create a new human resources system, based on the notion that the current one was too rigid and outdated to allow an effective response to modern threats of terrorism.

But NSPS has been the subject of much controversy, with critics arguing that the system illegally curtails the collective bargaining rights of employees. An appeals court ruled in May that the 2004 law grants the agency the authority to scale back collective bargaining rights until November 2009. A petition submitted by federal labor unions for a review of that decision by the full appeals court is pending.

In the meantime, unions have been lobbying Congress to pass language to block aspects of NSPS. In May, the House passed the 2008 Defense authorization bill, which includes language that would repeal the existing authority of Defense to move forward on the labor relations portions of the system. The Senate Armed Services Committee passed similar language late that month.

COMMENTS

• I had a break in service. I went out as a wg-10 and was rehired in a different position as a gs-07. I was never a gs prior to this year. What I see happening is incentives for poorly qualified kids coming into the construction field and "older" experienced workers being kicked to the curb. The whiz kid's get rolled over by contractors and their superiors bestow them with accolades for their performance. I am a white male age 56. My supervisor has asked me repeatedly how old I am and when I intend to retire. This I assume is a factor in awarding training, incentives and promotion. NSPS offers no recourse for discrimination on the basis of age, disability or race. I believe this administration came to power under suspect methods with an agenda to undo every program and policy implemented for the advancement of socioeconomic standing. The elite will cheat, lie and sacrifice lives to enhance their own rank as ruling class "families". ed leary Posted October 19, 2007 4:06 PM
• You are some of the whiniest people on earth! This is simple...work harder, have the potential to get paid more. So many DoD employees are OVERPAID...yes, they make more money than they earn, compared to what the same skills cost outside of DoD. To make matters worst, they spend more time whining than working. Get over it...the days of longevity based pay - no matter how little or how poor your work is - is gone. Is NSPS perfect? Heck no. But, it's a long needed change to a system which has rewarded people who are lucky to have a job. Proud American Posted September 13, 2007 12:37 AM
• Having recently retired after 32+ years of federal service, 19 of which in supervision, I fully concur with the comments concerning prospective misuse of the pay for performance aspects of NSPS. Like it or not, HR problems in DoD are mainly due to poor civilian leadership - caused by the tendency of white males to hire other white males of lesser intelligence than themselves (as Don Rumsfeld used to say, "A's hire A's and B's hire C's") who will not rock the boat. Being a white male, I can attest to this. A civilian supervisor in DoD who challenges the poor opinions/decisions of upper management on a regular basis is eventually moved to a position of lesser or no importance (carefully done as a "non-adverse action.) So, NSPS will now provide upper management with a pay for performance tool to further encourage behaviors that they prefer. You cannot solve a leadership issue with a "new" system. Bad leaders will badly administer even the most ideal system and government has yet to devise an "ideal" system for anything. R. White Posted July 24, 2007 8:54 AM