A-76 debate continues

As the Office of Management and Budget works on final revisions to Circular A-76, representatives from the Defense Department, Congress and the General Accounting Office are weighing in with their recommendations on the best course of action.

Circular A-76 outlines how the public and private sectors should compete to perform commercial-like government functions. Last November, OMB proposed major revisions to the circular, including a new definition of which jobs are "inherently governmental" and a reduction of the circular's current three-year cycle to one year.

OMB received more than 700 public comments on the proposed changes and is in the final stages of reviewing them before issuing a final rule, said Angela Styles, administrator of the Office of Federal Procurement Policy.

During a March 19 hearing before the Senate Armed Services Committee's Readiness and Management Support Subcommittee, lawmakers peppered Styles and other officials — Pete Aldridge, undersecretary of Defense for acquisition, technology and logistics, and David Walker, U.S. comptroller general — with questions about whether the revised A-76 favors industry or actually promotes competition.

Sen. Carl Levin (D-Mich.) said the revised circular "doesn't appear to reflect a commitment to competition" and makes the process essentially a "direct conversion" of government jobs to the private sector. He added that a recent letter from Walker to OMB Director Mitchell Daniels Jr. said the proposed revisions sent a negative and unfortunate message to government employees.

"I do not anticipate a reference to 'direct conversion' in the final draft... [and] may eliminate 'direct conversion' references altogether," Styles said. She added that the Bush administration is concerned that some agencies are handing government work to the private sector without considering cost, something that the revised rules would attempt to eliminate.

Sen. Saxby Chambliss (R-Ga.) was highly critical of the circular. "I don't like A-76. I don't like it because I don't think it's fair. It's a one-way street."

Chambliss said he would like to see a review of past projects that have been outsourced using A-76 to determine whether the government has ever been given a chance to bid on bringing work back in-house.

However, Aldridge said the government can only take back outsourced work if it has "excess capacity," adding that he does not see evidence of that at DOD.

Styles said A-76 currently includes barriers to bringing work back in-house, but those will be removed. While acknowledging that the focus is on potentially outsourcing jobs, she noted that when jobs are outsourced, they are subject to competition every three to five years — contrary to the hundreds of thousands of government jobs that have never been subject to competition.

The harshest criticism of A-76 came from Bobby Harnage, national president of the American Federation of Government Employees. "The November draft is so one-sidedly pro-contractor, it defies belief." He added that under the rewritten circular, at least 850,000 federal jobs would be subject to privatization, while "only a tiny handful of contractor workers would be reviewed."

Styles reiterated that final decisions on the revised Circular A-76 have not been made and said the administration is continuing to review public comments and attempting to address concerns about fairness, timelines, direct conversions and more.