Senate rejects plan to allow Defense employees to compete with contractors

The Senate on Tuesday rejected, on a 50-49 vote, a legislative proposal that would have mandated government competition with private firms for certain defense work.

The measure was introduced by Sen. Ted Kennedy, D-Mass., and backed by the American Federation of Government Employees, the largest federal employee union. The proposal closely resembled legislation offered in the House by Reps. Thomas Allen, D-Maine, and Robert Andrews, D-N.J. earlier this year.

The Senate Republican High-Tech Task Force had urged members to vote against the proposal, arguing that it would be costly to the government and would discourage private industry.

In a letter to Senate colleagues signed by 11 of its members, the task force said the amendment--proposed to the fiscal 2003 Defense Department authorization bill--would have caused some technology companies to stop vying for federal contracts because it would have mandated government competition with private firms for certain defense work.

Service contractors also fought the measure. "It was a definite threat to industry's ability to respond to the needs of the Defense Department," said Gary Engebretson, president of the Contract Services Association, in a statement.

The amendment would have required the Defense Department to allow federal employees to compete for work currently performed by private sector firms. Competitions would have been held under Office of Management and Budget Circular A-76, which allows Defense to outsource work performed in the government if it can be done more cheaply in the private sector.

Virginia Republican George Allen, chairman of the task force, said in a statement that the amendment would have "complicate[d] the procurement process and cost taxpayers more money."