OMB targets more jobs for outsourcing in 2003

Private sector firms will be able to compete for as many as 85,000 federal jobs in fiscal 2003, a spokesperson with the Office of Management and Budget said Friday. The Bush administration will require agencies to compete at least ten percent of all government positions considered "commercial in nature" in fiscal 2003, according to Amy Call, deputy associate director for communications at OMB. Under the 1998 Federal Activities and Inventory Reform (FAIR) Act, agencies must compile annual lists of all commercial positions. The 10 percent mandate doubles OMB's competition target for fiscal 2002, when agencies are required to directly outsource or perform public-private competitions on 5 percent of FAIR Act positions, or 42,500 jobs. The mechanics of the outsourcing mandate will stay the same in 2003, Call said. Agencies will be able to use direct conversions, in which jobs are converted to the private sector without competition, and public-private competitions to meet the ten percent target. As in fiscal 2002, agencies will not be allowed to use reason codes to exempt any FAIR Act positions from the ten percent competition requirement, said Call. Call said the new 10 percent requirement is an incremental increase from the 5 percent target of fiscal 2002. Agencies were informed of the 10 percent target in guidance for the 2003 budget, she added. The Bush administration still plans to put half of all FAIR Act positions up for private-sector competition eventually. Last month, OMB Director Mitch Daniels said the 50 percent target was a "long way off." Agencies are putting the finishing touches on the latest FAIR Act inventories, which are due to OMB by June 30. The 10 percent requirement will apply to these inventories. Stan Soloway, president of the Professional Services Council, lauded the Bush administration for encouraging competition but cautioned that agencies may not be able to meet the 10 percent target. "It will clearly be difficult to do under current processes for competition," he said. "But there's an old theory that you set tough goals or you don't achieve modest ones." OMB's decision to prohibit reason code exemptions from the ten percent requirement may frustrate some agencies, according to Allan Burman, president of Jefferson Solutions and former administrator of the Office of Federal Procurement Policy. "Many of the agencies feel there are positions that are commercial in nature but for a number of reasons should still be done by government people," he said. Robert Agresta, vice president of the consulting firm Star Mountain, Inc., said OMB's competition requirement does not force agencies to review their commercial inventories to determine what functions should be competed, a major goal of the FAIR Act. In his view, OMB should require agencies to review a certain percentage of positions on their FAIR Act lists each year. "The hard number target should be applied to a systematic review of commercial inventories, rather than saying you have to compete five or ten percent," he said. "Actual competitions should be a result of that process."