Defense authorization bill drops industry sore points

Government contractors can breathe a bit of a sigh of relief with the conference version of the 2013 National Defense Authorization Act.

The final version of the bill backs off provisions involving workforce strength, contractor compensation and access to internal audits, that many in industry found troubling.

“Common sense has prevailed,” said Professional Services Council President and CEO, Stan Soloway.

PSC had objected to provisions in the bill that required a set ratio of civilian and contractor workforce reduction. It also set limits on salary reimbursement, and allowed the Defense Contract Audit Agency unlimited access to defense contractor internal audit reports and working papers.

All three provisions were beaten back in the conference report in order to reconcile House and Senate versions of the bill.

According to a PSC statement, the new provision for workforce reductions gives the Defense Department flexibility in how it reduces staff.

“Requiring DOD to make equal cuts across its blended workforce would have deprived the department of the ability to make strategic decisions about how to best meet its mission needs,” Soloway said.

On the issue of compensation, the provision to cap reimbursement was replaced by a requirement to have the Government Accountability Office conduct a study on the impact that such a move would have on the Defense Department, as well as the industrial base and contractor employees.

On the audit issue, the new provision lets DCAA only use internal audit reports to assess risk and evaluate internal controls and business systems.