While government insiders applauded the General Services Administration’s move to cut back contracting schedules to save $24 million, some caution against what could become a “slippery slope.”
GSA said it will stop adding new contractors to schedules – the shopping catalog for the government to get bargains and discounts – as the first step toward streamlining its contract offerings. After a year, officials will review the schedules to see if there is still demand for them. GSA plans to eliminate contract agreements that are rarely or never used.
The new policy was announced last week, a move to clean up the out-of-date contracting vehicles that still offer goods like typewriters and non-digital photographic equipment.
Janet Clarke, senior vice president of the Washington Management Group, a Deltek company, said it’s about time for GSA to pare down its obsolete contracts while continuing to offer valuable cloud computing and cybersecurity services.
“A re-look on a regular basis is necessary,” Clarke told Breaking Gov.
However, Larry Allen, President of Allen Federal Business Partners, a McLean consulting firm that advises government contractors, warns the GSA should be careful about what it’s doing.
“While no one can really argue about closing down the typewriter schedule or other things that are obviously obsolete, I am concerned that many in the agency would start to look at closures as a default workload management tool,” he told Breaking Gov. “We could quickly find that GSA just periodically shuts things down when workload reaches some undefined status of ‘too much.'”
He added: “GSA could quickly find that they no longer have the most current products or services on schedule. While well-intentioned, this step could lead to a slippery slope of unintended consequences very easily.”
According to GSA, the Multiple Award Schedules system that offers deep discounts for goods and services has gotten bogged down with useless contracts that generate little or no business, and costs too much money to maintain and administer.
The schedule has more than 8,000 obsolete contracts with firms that hawk goods and services no longer needed by the government. It also will stop adding contracts for trophies and commemorative or promotional items, contracts that cost $3,000 a year just to maintain.
The number of companies trying to get on schedules has doubled in recent years, and the number of modifications to existing contracts has tripled, which requires significant resources to maintain, according to GSA.
“By stopping the proliferation of low performance contracts and cutting products or services that are no longer mission-critical to the government, GSA will reduce waste and save millions of taxpayer dollars annually,” said Dan Tangherlini, acting administrator. “This helps us streamline the way we do business, save taxpayer dollars, and ensure the most efficient delivery of services to our customer agencies.”
The Multiple Award Schedules leverage the purchasing power of the federal government to provide discounted products and services to government agencies through thousands of contracts with private companies. GSA projects that more than 50% of the contracts put on the schedule in 2011 will have low or no sales.
GSA will also review more than 19,000 other contracts to see which industries are over saturated, and where duplication in products and services offered “has created a crowded and confusing market.”
“When contracting officers are bogged down managing thousands of contracts with little to no sales, they can’t focus on adding innovative solutions to the schedules, improving pricing, and simplifying the buying experience for our customers. Modernizing the schedules will change that,” said Steve Kempf, Commissioner of the GSA Federal Acquisition Service.