OMB reports progress with competition goals

A Bush administration report designed to promote its competitive sourcing initiative shows that controversy over the initiative is not likely to fade.

The Office of Management and Budget report, titled "Competitive Sourcing: Reasoned and Responsible Public-Private Competition," is intended to supplement a July report that examined five agencies to show how they were implementing rules to govern competitions between federal employees and private contractors.

The new report, dated September 2003, includes a summary of the workforce and competition plans for the 24 agencies the President's Management Agenda tracks.

Federal employee unions and some congressional Democrats have fought the measure since OMB began revising its Circular A-76, which lays out rules for conducting competitions. Although opponents have won some concessions from OMB and some legislative victories, the competitive sourcing initiative remains.

"You're not going to see the end of the battle this year," said Stan Soloway, the Professional Services Council's president. "I expect this to be a continuing battle for quite a while."

In some respects, opponents and supporters are simply on different sides of an ideological divide that is unlikely to be bridged, Soloway said. The Bush administration argues that competition is generally good and leads to better value for taxpayers no matter who wins. Opponents see the initiative as a push to privatize ever-larger pieces of the government, eliminating hundreds of thousands of federal jobs.

"Whatever the administration's rhetoric and whatever mechanism it is pushing at any given time, the objective is to move as many federal jobs as possible to the private sector," said Colleen Kelley, president of the National Treasury Employees Union.

However, Soloway believes that most policy-makers understand the importance of competitive sourcing, even though they may call for greater oversight. Even an amendment that Rep. Chris Van Hollen (D-Md.) successfully added to OMB's appropriations bill forbidding the use of funds to carry out the revised A-76 permitted competitions under the old rules, Soloway pointed out.

Some have misgivings about an aggressive approach to opening jobs to outsourcing, but "there is equal discomfort with the idea that we're going to just shut down competition," he said. "There is a recognition that this needs to be done."

From a practical standpoint, agencies face some significant challenges in implementing the new Circular A-76, Comptroller General David Walker said. In written testimony he submitted Oct. 3 to the Senate Oversight of Government Management, the Federal Workforce and the District of Columbia Subcommittee, he outlined some of them.

Chief among the challenges is a 12-month limit that the new circular places on most competitions. Walker, responding to written questions from subcommittee members, agreed that the time frame might be unrealistic. Data from the Defense Department shows that competitions often take an average of 25 months. However, the new A-76 mandates that some planning must occur before a public announcement of a competition, which could make it possible to carry out the process in a shorter amount of time.

Walker's General Accounting Office had previously recommended that OMB lengthen the time frame to 18 months. "We believe that additional financial and technical support and incentives will be needed for agencies as they attempt to meet the ambitious 12-month time frame," he wrote.

Specifically, Walker recommended establishing a fund at OMB that agencies could draw from to help conduct and manage the competition process.

OMB's new report emphasizes a customized plan for each agency and dedicated high-level management oversight to ensure that the process gets proper priority and effective management. Each agency should appoint a competitive sourcing official to accomplish that, under the revised A-76 guidelines.

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