OMB defends stance on competition

The Bush administration last week defended its commitment to public/private competition, an initiative that critics maintain is rife with problems.

"When a commercial function performed by the public sector undergoes competition, that competition results in significant economic savings to the taxpayer," said Angela Styles, administrator of the Office of Management and Budget's Office of Federal Procurement Policy.

Allowing the private sector to compete against government agencies to perform public functions—regardless of who wins—reduces the cost of performance by more than 30 percent, Styles testified June 28 before the House Government Reform Committee's Technology and Procurement Policy Subcommittee. But Styles said even if there are no cost savings, competition improves management, performance and innovation.

The administration's "competitive sourcing" initiative begins with the Federal Activities Inventory Reform Act of 1998, which requires that agencies submit annual inventories of all activities that are not inherently governmental and therefore could be outsourced. For fiscal 2002, agencies must put at least 5 percent of these jobs out for bid (see "OMB raises goal for fed outsourcing in 2003"). Agencies are to use OMB's Circular A-76 as a guide when determining whether a commercial activity should be outsourced to the private sector.

However, the initiative has its critics. "The A-76 process is broken," said Rep. Tom Davis (R-Va.), the subcommittee chairman. Federal employees are not adequately trained in how the process works, and some costs, such as overhead, are calculated differently in the public and private sectors, leading to unfair competitions.

Bobby Harnage Sr., national president of the American Federation of Government Employees union, said he opposes outsourcing without competition — a process known as direct conversion. Harnage and more than 180 members of Congress support the Truthfulness, Responsibility and Accountability in Contracting Act, which would require agencies to track whether contracting efforts are saving money.

Featured

  • Workforce
    online collaboration (elenabsl/Shutterstock.com)

    Federal employee job satisfaction climbed during pandemic

    The survey documents the rapid change to teleworking postures in government under the COVID-19 pandemic.

  • Workforce
    By Mark Van Scyoc Royalty-free stock photo ID: 285175268

    OPM nominee plans focus on telework, IT, retirement

    Kiran Ahuja, a veteran of the Office of Personnel Management, told lawmakers that she thinks that the lack of consistent leadership in the top position at OPM has taken a toll on the ability of the agency to complete longer term IT modernization projects.

Stay Connected