Federal Manager's Daily Report

Numerous issues would arise in any effort to lift the longstanding ban on studies in which the in-house costs of certain commercial-type federal jobs were compared with contractor bids, the Congressional Research Service has said.

When the “OMB Circular A-76” process was in common use—especially at DoD, which has the bulk of such jobs—it resulted in the contracting out of tens of thousands of federal jobs. However, through a series of spending bills, agencies have been barred for more than a decade from conducting such studies, following controversies including whether agencies were losing control over their missions and whether the promised savings were being achieved.

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Said CRS, “While some view A-76 competitions as an effective cost-savings mechanism that also increases government efficiency, others believe that the government has overestimated or improperly calculated the substantial savings sometimes attributed to public-private competitions. Critics see the A-76 process as a vector for undue and improper privatization of government functions.”

The White House’s budget proposal for fiscal 2021, like its prior proposals, seeks to lift the moratorium on conducting those studies. The CRS report said that raises issues including (in its words):

* To what extent should existing law and policy guidance for public-private competitions be modified to reflect best practices and prior lessons learned?

* What benefits might be realized in requiring a phased rollback of the moratorium, or in allowing selected public-private competitions to proceed as pilots?

* Should certain government performed commercial-type functions beyond those already exempted by statute and policy be protected from public-private competitions? If so, which functions?

Other issues, it said, include the accuracy of procedures for comparing costs at the bid stage and the actual costs afterward, and whether after 10 years the expertise still exists to “fairly and effectively evaluate A-76 competitions.”

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