Officials defend A-76 on Hill

As the Office of Management and Budget works on its final revisions to Circular A-76, representatives from the Defense Department, Capitol Hill 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 compete for commercial-like government functions. Last November, OMB proposed major revisions to the circular, including a new definition of what jobs are "inherently governmental" and cutting the 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 the comments 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, the undersecretary of Defense for acquisition, logistics and technology, and David Walker, U.S. comptroller general — with questions about whether the revised A-76 simply 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 public/private competition an equivalent to the "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 personnel.

"I do not anticipate a reference to 'direct conversion' in the final draft...and] may eliminate 'direct conversion' references all together," Styles said. She added that the Bush administration's concern is that some direct conversions are made without cost considerations, something that the revised rule will attempt to eliminate.

Sen. Saxby Chambliss (R-Ga.) was even more critical. "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 and ascertain whether the government has ever been given a chance to recompete for that work.

However, Aldridge said if the government wants to take outsourced work back, that means there is "excess capacity" and added that he does not see much of that in DOD.

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

The harshest criticism of A-76 came from Bobby Harnage, the American Federation of Government Employees' national president. "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 alleviate concerns about fairness, timelines, direct conversions and more.