Performance-based acquisitions down in fiscal 2006

Federal Data Procurement System - Next Generation

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The government slipped slightly last year in making performance-based purchases, according to fiscal 2006 federal procurement figures.

Departments slid to 49 percent, down from 50.9 percent in fiscal 2005, the Federal Procurement Data System-Next Generation (FPDS-NG) found.

The decline amounts to a $5.6 billion difference from fiscal 2005. The government used $72.3 billion of eligible dollars in fiscal 2006, compared with $77.9 billion in 2005, according to the data, which is updated through Dec. 12, 2006.

In fiscal 2006, departments had $147.2 billion eligible for performance-based acquisitions, the data shows.

After a steady climb in performance-based acquisitions since 2001, departments leaped 10 percentage points in 2005 to 50.9 percent, the FPDS-NG numbers show. In fiscal 2001, only 26.2 percent — or $31.8 billion — of eligible funds were used as performance-based acquisitions.

The government nevertheless has continued to exceed its annual percentage goal for performance-based acquisitions, according to the report. The goal has been 40 percent since fiscal 2004.

The innovative contracting style is a staple of government acquisitions. Performance-based contracts are often structured so that companies are paid for reaching certain performance benchmarks or penalized for failing to meet them.

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