Under a two-year plan announced in March, President Barack Obama asked government departments and agencies to save $40 billion in contracting costs by the fiscal year ending on September 30, 2011, by ending unnecessary contracts and improving acquisition management.
They were also charged with limiting reliance on contractors and reducing the use of high-risk contracts, such as those awarded without competitive bidding, a segment of the federal budget that has ballooned in recent years.
U.S. government spending on contracts has more than doubled since 2002, totaling about $540 billion in 2008, and the use of the noncompetitive, “high risk” has risen by 129 percent, from $82 billion to $188 billion, in the same period, OMB said.
The system has also been flawed with mismanagement and waste, said Jeff Zients, deputy director of the Office of Management and Budget.
“No business, large or small, could survive the continued waste and mismanagement the federal government has experienced. It’s illogical, it’s unacceptable, and we will fix it,” Zientz told reporters on a conference call.
Obama was to make a statement later on Monday about the cost-cutting program after meeting with an employee at the Department of Veterans Affairs who won a competition that asked federal employees to submit cost-cutting ideas.
