Readers react: Sizing up set-aside contracts

John Moliere is puzzled by another reader's suggestion that the government should do away with its set-aside contracting programs. That reader was commenting on FCW's recent story about Obama's acquisition reform initiative (check it out here).

"If the new Administration really wants to help in contracting arena and save money, it should eliminate ALL of the special set-aside programs," the reader wrote. "These programs add to the hassles the contract administrators go through, reduces competition, increases costs, and often results in lower quality service or product."

Another reader expressed similar sentiments:

"A big problem with government contracting is that much of it is done for social engineering purposes. Much of it is small disadvantaged business set aside. Getting rid of that restriction would save the government a lot of money, but it would eliminate some of the social engineering. The government just needs to decide what is important, social engineering or cost efficiency."

Moliere, the community's biggest proponent for setting aside contracts for businesses owned by service-disabled veterans, had to respond. Here's what he wrote:

I read a couple of comments that I would like to respond to in particular, the one that has the statement in it'...it should eliminate ALL of the special set-aside programs. These programs add to the hassles the contract administrators go through, reduces competition, increases costs and often results in lower quality service or product.' Wow. This sounds like an angry employee of a large business that is afraid of losing his/her cushy job or a fed that is too lazy to go the extra mile. The so called set-aside programs relieve large businesses the burden of maintaining large back benches of niche capabilities and it provides a legitimate opportunity for the job creating engine of our economy to respond cheaper and quicker than large firms with inordinately expensive Taj Mahal like edifices and great trappings to pay for through the burden of overhead and [general and administrative] expense out of control. It also enables the veterans and service disabled veterans a chance at the slice of the opportunity just like it does for the forgotten minority of 53 percent...the women and the other disadvantaged people of color or geographical handicap. Wake up and look around. These programs keep the big firms from running amok. Sure, large businesses have no business receiving sole source contracts like the KBR Halliburton front page issue, especially where there is evident competition, but do not look in a condescending manner on the socio-economic groups that have fought hard to earn the little advantage they have earned. 

We certainly have heard nothing to suggest that Obama would consider ditching set-asides. But it will be interesting to see how well the various socio-economic groups fare with stimulus spending.