WASHINGTON (Reuters) – Congress is poised to nearly halve the salary cap for U.S. government contractors after years of dramatic increases driven by skyrocketing executive pay.
A broad budget bill that won approval by the House of Representatives on Thursday would lower the cap to $487,000 a person, down from its current level of $952,000. The Senate is expected to pass the bill next week.
The measure would be a partial victory for the White House, which for years has sought to rein in contractor reimbursements that fund salary and other personnel costs. In May, the White House proposed limiting the reimbursement level to $400,000 a person – the amount Barack Obama earns as president.
Office of Federal Procurement Policy
Office of Management and Budget
ATTN: Ms. Aisha Hasan
725 17th Street, N.W.
Washington, D.C. 20503
Submitted via regulations.gov
Subject: Public Comments on the Use of Cost Comparisons
Dear Ms. Hasan:
The Project On Government Oversight (POGO) provides the following public comment regarding the use of cost comparisons outlined at 78 Fed. Reg. 11232 (February 15, 2013). Founded in 1981, POGO is a nonpartisan independent watchdog that champions good government reforms. POGO’s investigations into corruption, misconduct, and conflicts of interest achieve a more effective, accountable, open, and ethical federal government. POGO has a keen interest in government contracting matters, especially the important but often ignored issue of service contracting costs.
The Office of Federal Procurement Policy (OFPP) in the Office of Management and Budget (OMB) announced a public meeting on March 5, 2013, and requested public comments on “the practice of comparing the relative cost of performance by Federal employees versus contract performance in order to identify the most cost-effective source.” POGO hopes that all of the oral and written comments will be used to create a comprehensive cost comparison model that will be used when making human capital planning decisions.
Establishing a uniform, effective cost comparison model is one of the most, if not the most, important tasks facing the government today. This model, whether established by improving the A-76 process or building a new cost comparison process, must be initiated earlier in the human capital policy and planning phase. It also must compare the full life-cycle costs of outsourcing federal services to contractors with the costs of having those services performed by federal employees.
Taxpayers can be billed $952,000 per contractor employee under new rule
WASHINGTON – American Federation of Government Employees National President J. David Cox Sr. today expressed his outrage at the news that the cap on annual compensation paid to contractor employees using taxpayer dollars has been increased to an astounding $952,000.
The new limit announced by the Office of Management and Budget reflects a one-year increase of nearly $190,000 and a four-year increase of 55 percent. The compensation cap has nearly quadrupled since the mid-1990s.
Federal workers, military personnel and veterans could take a hit under more than a dozen deficit-reduction options the nonpartisan Congressional Budget Office detailed in a new report Wednesday.
The potential impacts range from reduced pensions and cost-of-living raises for federal employees to capped pay increases for military personnel and stricter eligibility requirements for veterans’ disability.
Sen. Patty Murray (D-Wash.) talks to an aide during a conference on the budget. (Alex Wong/Getty)
As feared, the 16-day government shutdown forced contractors to scramble for cash, revise their schedules, and reconnect with their agency liaisons, according to trade association officials.
“The good news is that most companies are putting folks back to work, which they should have been doing all along had there not been a shutdown,” said Alan Chvotkin, executive vice president and counsel at the Professional Services Council. “Our member survey shows that a large percentage of member companies did receive one or more stop-work orders. And though most, but not all, of those have now been reversed, large numbers of those contracts were unnecessarily and inappropriately stopped.”
Chvotkin said many agencies sent out blanket notices to all their contractors, even though a reading of the law says the notices would not apply to contracts fully funded in fiscal 2013 and contracts that don’t require access to government facilities or significant agency supervision. “So companies are now trying to redo those actions and restart work, which takes significant administrative work and deadlines such as something that was due in 30 days have to be rescheduled.” Continue reading “Contractors Say Shutdown Forced Them to Reprioritize”