Buying Season's Hidden Costs

In August, the federal IT market research firm INPUT released a report showing agencies spending a greater portion of their IT budgets in the government’s fiscal fourth quarter. That’s up from 28 percent from the four year time period of fiscal 1997 to fiscal 2000.

Tech Insider blog item wondered if such an increase in IT spending over such a short period of time increased the chance that agencies may not be aligning spending with strategic goals and wasting money.

The answer may very well be yes, according to the Treasury Inspector General for Tax Administration. In a recent report, the IG found that the value of purchases by the Internal Revenue Service made in the month of September increased 671 percent from 2002 to 2006. Reviewing purchases made in August and September 2006, the IG “identified deficiencies with 14 (15 percent) of 92 procurement actions …,” according to the report. “We believe appropriations regulations may have been violated for four of the actions, while all required acquisition steps were not completed for the remaining 10 actions.”

The IG also wrote:

Inefficient and ineffective procurement actions can occur when there is a rush to use funds before they expire at fiscal yearend. This rush increases the risk that items purchased may not meet the requester’s need, thus requiring a second procurement action; were not obtained at the best possible price; or did not use the best vendor or type of contract because Office of Procurement personnel do not have the time necessary to perform a full contractor competition process. Therefore, funds may be spent inefficiently and ineffectively.