Government Contracts

GAO-05-229 February 2005
CONTRACT
MANAGEMENT
Opportunities to
Improve Pricing of
GSA Multiple Award
Schedules Contracts

A good, non-technical Read for Those interested in how the Government spends Your money:


Federal agencies can directly
purchase more than 8 million
commercial products and services
through the General Services
Administration’s (GSA) multiple
award schedules (MAS) contracts.
Over the past 10 years, MAS
contract sales have increased
dramatically—with sales jumping
from $4 billion to $32 billion.


While GSA has taken
steps to establish a program to assess the quality of its MAS contract
negotiations, all acquisition centers are not fully participating, and the
scope of the program is limited. Moreover, the program has not yet
determined why deficiencies it has identified thus far are occurring. Until
GSA takes steps to ensure the appropriate use of available pricing and
negotiation tools, it will continue to miss opportunities to save the
government hundreds of millions of dollars in the procurement of goods
and services

The Reader can review the GAO's recommendations to correct the situation if desired, but the Author would like to offer his own recommendations:

1) Congress must set the Contract award levels for use of Prenegotiation Panels, Pre-award audits, and post-award audits: Panels and Pre-award audits--$3m, Post-award audits--$1m.
2) Congress should authorize standing Prenegotiation Panels, who must maintain review procedures for 12 Contracts continually.
3) Prenegotiation panels should be extended to military Contract awards.
4) Congress should establish a Post-award Commission with funding budget, which will supply qualified Auditors to all forms of Government Contract awards above $1m.

The GAO study does not provide percentage Savings per Contract review by Panel, Pre-award, and Post-award audits. Rigorous use of these instruments, though, could save the Government some 2.3% of all Contract awards yearly, in the Author's own estimate. lgl