Federal acquisition workforce ill-equipped for procurement reforms

The federal acquisition workforce lacks the skills and training to take full advantage of procurement innovations and reforms begun in the early to mid-1990s, according to experts from the public and private sectors who testified on Capitol Hill Tuesday. Tom Davis, R-Va., chairman of the House Government Reform Subcommittee on Technology and Procurement Policy, said the subcommittee needed to figure out how to craft legislation promoting greater use of procurement innovations and increased acquisition workforce training. Government-wide acquisition contracts, which open a single contract to numerous agencies, and other new contracting methods--such as share-in-savings and performance-based contracts, where contractors reap rewards only if their projects succeed--give contracting officers great flexibility in purchasing goods and services. But agencies sometimes don't clarify regulations for their employees, and contract officers often fail to adequately oversee contractor performance, said David Cooper, director of contracting issues at the General Accounting Office. Cooper noted that service contracting now accounts for 43 percent of all federal spending, and that information technology and professional and management support services are two of the largest components. The federal government acquired more than $87 billion in services last year, he said, an increase of 24 percent since fiscal 1990. Davis said that current contract management is insufficient and that innovative contracting options established under the Federal Acquisition Streamlining Act of 1994, the Clinger-Cohen Act and the rewrite of Part 15 of the Federal Acquisition Regulation (FAR) are underutilized because contracting officers lack training. He asked GAO to report back to the subcommittee on agency performance in that area. Davis emphasized that agencies must immediately consider share-in-savings contracts and cooperative purchasing off of the General Services Administration's schedules for information technology. He also urged an investigation into opening the schedules to state and local governments for IT purchases. David Drabkin, deputy associate administrator in the office of acquisition policy at GSA, testified that procurement reforms have placed unprecedented demands on the acquisition workforce. "Contracting specialists are now expected to have a much greater knowledge of market conditions, industry trends and the technical details of the commodities and services they procure," he said. Steven Kelman, a professor of public management at the Kennedy School of Government at Harvard University and former administrator of the Office of Federal Procurement Policy, said that the acquisition workforce needs to eliminate a "destructive attitude" that finds it acceptable for contractors to fail to meet expectations as long as the government doesn't lose money. Kelman said that share-in-savings contracts are a good way to increase project successes because they create an incentive for the contractor to do well. There needs to be federal legislation to establish share-in-savings contracts as a contract type in the FAR, he said. Kelman also called on Congress to direct OMB to work with GSA and other agencies to identify share-in-savings contract opportunities and "to develop methods that would allow agencies to keep a portion of the savings these efforts generate over a period of years." Kelman noted that contracting officers have told him they are reluctant to use share-in-savings contracts for fear that the money they save will be taken away during the budget or appropriations process the following year. Davis said he believes competition among vendors is the best way to ensure the government gets the best buy for its dollar. GAO's Cooper noted that many agencies do not take enough advantage of competition, doing business with the same contractor repeatedly simply out of "comfort." David Oliver, principal deputy undersecretary of Defense for acquisition, technology and logistics testified that the Pentagon has set a goal of making 50 percent of its contracts performance-based by 2005. He said Defense will put templates for such contracts on its Web site in three months so that others can use them as examples. Cooper applauded Defense's efforts, as well as its publication of a guide for performance-based contracting last December. Kelman also addressed the issue of contract bundling, whereby several contracts are rolled into one massive buy in a single agency, saying the practice is currently over-regulated. There are "lots of proposals for dangerous over-regulation in this area," he noted. Kelman said contract bundling provides great savings, better contracting terms and results in closer attention from suppliers. The alternative, he said, is to have established contractors providing services, which "we know from long experience is a recipe for disaster."