Very interesting testimony from Scott Amey, who is the General Counsel for the The Project On Government Oversight (POGO) (http://www.pogo.org/). in a hearing before the Congressional Oversight Committee on the on Treasury’s Use of Emergency Contracting Authority, Mr. Amey called for increased competition -real competition - in federal contracting, specifically calling for greater utilization of reverse auctions, testifying that:
To better evaluate goods and services, and to get the best value for taxpayers, the government must encourage genuine competition. At first glance, it may seem that federal agencies frequently award contracts competitively, but the definition of “competitive” includes limited competition and one-bid offers. Consequently, to accurately track or evaluate competition, the definition of “competitive bidding” should be revised to apply only to contracts on which more than one bid was received.
In addition to redefining competition, federal agencies must:
- Reverse the philosophy of quantity over quality. Acquisition is now about speed, making competition a burden; this is a recipe for waste, fraud, and abuse.
- Debundle contract requirements in order to invite more contractors to the table. Contracts that lump together multiple goods and services exclude smaller businesses that could successfully provide one good or service, but are incapable of managing massive multi-part contracts. Breaking apart multi-supply or -service contracts reduces the multiple layers of subcontracting which can drive up costs while adding little value.
- Ensure that waivers of competition requirements for task and delivery orders issued under multiple-award contracts or the federal supply schedule program are granted infrequently.
- Increase emphasis on sealed bidding to receive the lowest prices.
- Use reverse auctions more frequently. In a Department of Energy reverse auction for pagers, two companies submitted initial bids for $43 and $51 per pager. At the close of bidding, the government awarded the contract at the price of $38 per pager.
Why is competition in contracting important? In a nutshell, genuine competition between contractors means the government gets the best quality goods and services at the best price. Competition also prevents waste, fraud, and abuse because contractors know they must perform at a high level or risk being replaced.
You can read the full testimony at POGO's website:
Testimony of POGO's Scott Amey before the Congressional Oversight Hearing on Treasury’s Use of Emergency Contracting Authority
President Obama and Jeff Zients, who is the Federal Chief Performance Officer, have emphasized the reforming contracting is a major priority and that reverse auctions will play a critical role to introduce savings and transparency into procurement processes, you can expect to see a real trend toward far greater use of competitive bidding in the very near future (See http://wyld-about-technology.blogspot.com/2010/09/president-obama-priorities-procurement.html). We here at the Reverse Auction Research Center will be monitoring the situation and provide you with the latest news from all the cabinet agencies strategies to make increased use of reverse auctions.
President Obama and Jeff Zients, who is the Federal Chief Performance Officer, have emphasized the reforming contracting is a major priority and that reverse auctions will play a critical role to introduce savings and transparency into procurement processes, you can expect to see a real trend toward far greater use of competitive bidding in the very near future (See http://wyld-about-technology.blogspot.com/2010/09/president-obama-priorities-procurement.html). We here at the Reverse Auction Research Center will be monitoring the situation and provide you with the latest news from all the cabinet agencies strategies to make increased use of reverse auctions.
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