Democratic lawmakers allege abuse in federal contracting

The Bush administration is on a federal procurement binge, fueled by increasing mismanagement and corruption in such contracts, Democrats on the House Committee on Government Reform allege in a new report released today.

The nation's largest federal contractor, Lockheed Martin Corp., was paid $25 billion by the government in 2005?an amount larger than the budgets of the departments of Commerce and the Interior, the Small Business Administration and Congress combined, the report states.

The top five federal contractors?Lockheed Martin, Boeing Co., Northrop Grumman Corp. Raytheon Co. and General Dynamics Corp.?received a total of $80 billion in 2005, which is 21 percent of all federal contract dollars, the report stated.

The fastest growing federal contractor between 2000 and 2005 was Halliburton Co., whose procurement revenues increased from $763 million in 2000 to nearly $6 billion in 2005.

Overall federal procurement spending has risen 86 percent from 2000 to 2005, to $378 billion annually, the report said. The 101-page report was prepared at the request of Rep. Henry Waxman (D-Calif.), senior Democrat on the committee.

"Under President Bush, the federal government is now spending nearly 40 cents of every discretionary dollar on contracts with private companies?a record level," the report states. Federal contracts have become the fastest-growing component of federal discretionary spending.

Furthermore, mismanagement in federal contracting is widespread, with increases in noncompetitive contracting, inadequate oversight, abuse of contracting flexibility and poor contract planning, the report states. For example, noncompetitive and sole source awards more than doubled, going from $68 billion to $145 billion from 2000 to 2005.

The report identifies 118 contracts collectively worth $746 billion that have experienced significant overcharges, wasteful spending and management. It also outlines problems identified in major contracts related to Pentagon programs, the Iraq war, Homeland Security and Hurricane Katrina.

Among the largest of these alleged wasteful contracts listed in the report are $10 billion to Accenture Ltd. and partners for the U.S. Visitor and Immigrant Status Technology; $292 million to Aegis Defence Services Ltd., for Iraq reconstruction services; and $40 million to Akima Site Operations LLC for portable classrooms for post-Katrina Mississippi classrooms.

About the Author

Alice Lipowicz is a staff writer covering government 2.0, homeland security and other IT policies for Federal Computer Week.

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