GSA steps away from financial, HR services

In the past few months, the General Services Administration has been quietly moving away from providing some financial shared services, and experts say that's probably not a bad thing.

GSA had been offering shared services such as accounting and payroll through its Federal Integrated Solutions Center for years, but in a May 2 memo, the Office of Management and Budget left GSA off a list of agencies that will provide those services in the future.

The White House is also updating a plan to spread the use of shared services across government under its federal shared-service providers initiative. In July and August, according to OMB's second-quarter report, FSSP requires providers to develop and begin implementing plans to address capability/capacity needs and establish principles for governmentwide shared-services governance.

The move was not a surprise. At an ACT-IAC conference last fall, Anne Rung, who was then associate administrator of GSA's Office of Governmentwide Policy, said the agency was moving away from offering shared services for human resources after determining that such services are not among the agency's core strengths. Instead, GSA would put more emphasis on acquisition, real estate and IT, Rung said.

Last September, GSA issued a formal request for information seeking advice on how to withdraw as a provider of HR services that include personnel management, personnel action processing, benefits and retirement services, training and education, specialized support for small agencies and financial management. At the time of her remarks, Rung told FCW that a timeline for the withdrawal had not been finalized.

In the May memo, OMB and the Treasury Department designated four financial management shared-services providers that can provide core accounting and other services to federal agencies. The Agriculture Department's National Finance Center, the Interior Department's Interior Business Center, the Transportation Department's Enterprise Services Center and Treasury's Administrative Resource Center are ready to support agencies' efforts to modernize their financial systems, according to OMB.

Additional providers or product offerings might be designated in the coming years as lessons are learned from the initial four providers.

Multiple experts told FCW that OMB's move was probably for the best -- not because GSA failed to provide adequate services but because financial services are not among the agency's core competencies.

"GSA doesn't have the depth of experience" in financial services that other agencies do, said Alan Chvotkin, executive vice president and counsel at the Professional Services Council. "To his credit, [GSA Administrator Dan] Tangherlini has focused on his agency's core strengths of acquisition, real estate and fleet management."