DOD to scrutinize contractors' support services

Defense Department officials are planning tougher reviews of contractors' services that might be too close to jobs that only federal employees should perform, according to a letter released today.

In the letter to the Government Accountability Office, Shay Assad, director for defense procurement and acquisition policy at DOD, wrote he will revise how DOD managers review the extent to which contractors’ services support the work that is set aside only for government employees, or jobs that are termed inherently governmental functions. The officials will also adjust how managers should consider filling those functions with DOD’s civilian employees, he wrote.

Assad's letter is in response to a GAO report. GAO found that DOD, the largest federal buyer, does not require an assessment of those risks as part of reviews of acquisition strategies or when task orders are issued for professional and management services.

GAO found no evidence in the acquisition document reviews that DOD considered the risks, such as a potential loss of government control of mission-related policy and major program decisions. GAO analyzed seven acquisitions and more than 75 percent of task orders

In fiscal 2008, DOD obligated $200 billion on services contracts, including $42 billion for professional and management services, according to GAO’s report.

Assad also wrote that he will establish policies for DOD to properly assess the unique risks associated with outsourced services that are closely related to inherently governmental work, while training department employees to watch over the contractors providing those services.

DOD also plans to draft guidance on finding approaches to overseeing contractors who are supporting those government employee-only jobs, Assad wrote. Officials are already working on rules, as mandated by the fiscal 2009 National Defense Authorization Act, to make a clear distinction between contractors and government employees who are working the same office.