GAO chief criticizes competitive sourcing quotas

The head of the General Accounting Office criticized the use of quotas in competitive sourcing during a Senate hearing Monday.

"In my personal opinion, it is inappropriate to have quantitative targets in the area of competitive sourcing," said GAO chief David Walker at a hearing on legislation that would give federal agencies more flexibility to recruit and retain skilled employees. "These types of decisions require more informed judgments, not arbitrary numbers [that] can send a mixed message." Competitive sourcing is one tool agencies can use to meet their goals, but it must be used appropriately, Walker said.

The Office of Management and Budget has directed agencies to directly outsource or hold public-private job competitions on 15 percent of federal jobs deemed "commercial" by the end of fiscal 2003 and has said agencies must eventually compete 50 percent of their commercial jobs.

At a Senate hearing earlier this month, lawmakers and union officials criticized the Bush administration's plan to let private firms bid on thousands of federal jobs, saying the measure could hamper federal recruiting efforts and weaken the civil service.

Office of Federal Procurement Policy Administrator Angela Styles said at the time that OMB had to set targets in order to persuade civilian agencies to build the infrastructure needed to hold public-private job competitions. She also emphasized that OMB has worked with agencies to develop plans that fit their needs, and reiterated that some agencies could fall short of the 15 percent target if OMB approves their competitive sourcing plans.

But during Monday's hearing, Walker and union officials questioned the wisdom of setting specific outsourcing targets. "These one-size-fits-all arbitrary outsourcing quotas give no consideration to the unique needs of individual agencies," said Colleen Kelley, president of the National Treasury Employees Union. "Would you seriously consider employment with the federal government knowing your job may be contracted out from under you for no reason other than to meet an arbitrary number?"

Civil service reforms will be irrelevant if the administration moves ahead with its privatization quotas, said Bobby Harnage, president of the American Federation of Government Employees. "There will be no civil service, just a corps of political appointees and acquisition officers churning through the revolving door between contracting agency and contractor."

A GAO panel studying competitive sourcing issues will send its recommendations for improving the process to Congress in May, Walker said.

Monday's hearing focused on legislation designed to streamline the federal hiring process, improve government benefits for employees and provide more authority for job training and bonuses. S. 1612, S. 1603 and S. 1639 all aim to make the federal civil service more attractive and are pending in the Senate.

Although Kelley welcomed legislation "that draws attention to the federal government's human capital crisis," she criticized the bills for failing to seriously address pay parity between federal employees in the civil service and the military. The president's fiscal 2003 budget proposes a 4.1 percent pay raise for members of the military and a 2.6 percent pay raise for the federal workforce, which Kelley called "a slap in the face" to federal employees.

"We know that many think the president's proposed pay raise is not nearly enough, and we understand their position," said Kay Coles James, director of the Office of Personnel Management. "However, that proposed increase constitutes a reasonable and prudent use of severely constrained resources." OPM plans to release a report soon on the General Schedule pay system, James said.

GAO unveiled a draft management model Monday for agencies to use when developing their workforce plans. The framework focuses on linking performance and organizational goals, empowering employees and using existing authority to offer job incentives.