Procurement Accounts

Timothy B. Clark

Taking stock of government's buying surge.

Years ago, Government Executive bought a small magazine called Military Logistics Forum, which started an annual accounting of Defense Department procurement spending. Knowing that people like lists, its editor, Steve Hull, found a way to rank contractors in categories ranging from ships to missiles and according to their importance to the military departments and agencies that were doing the buying.

It wasn't easy, because government record-keeping was far from perfect. But Steve discovered a tiny company called Eagle Eye Publishers Inc.

that would make sense of difficult-to-decipher federal procurement data.

Some 20 years later, Eagle Eye data mavens Paul Murphy and Timothy Yeaney are still at it, and we are publishing the 18th edition of our Top 200 Federal Contractors. We report that government bought $425 billion in goods and services in fiscal 2006, amounting to 42 percent of discretionary spending, up from 33 percent 10 years ago.

Defense's commanding share of procurement spending rose to 72 percent, or $305 billion, in 2006. It's still rising, no doubt, with escalation of our troop commitment to Iraq. The Army is spending a lot of the extra money, and its leaders are concerned that operating costs-plus the plan to expand the uniformed head count by 65,000-will threaten the high-tech Future Combat Systems they view as essential. Modernizing inventories of weapons also is a priority for the Navy and the Air Force. One analyst we consulted says spending will need to remain high to fill in the services' "hollow" forces, but with the nation spending only 4 percent of gross domestic product on defense, the affordability of their ambitions remains in doubt.

There's much concern about the people and systems that agencies use to acquire what they need, we report in this issue. Agencies' reliance on lead systems integrators has come under attack in Congress, reflecting problems in the Future Combat Systems and the Coast Guard's Deepwater program. But it's encouraging that lessons from these programs are being applied to management of Boeing Co.'s big SBInet contract to help secure our borders. Influential members of Congress also are concerned about the size and quality of the acquisition workforce, and its ability to oversee huge agency contracts-and about the government's record in meeting goals for letting contracts to small businesses.

We're all familiar with procurement horror stories, but there's good news to report as well. The much-maligned Federal Emergency Management Agency has adopted promising new approaches to buying and delivering the things people in crisis need, and the General Services Administration too has improved its wide-ranging purchasing programs. And it's great, we can say on the basis of our own experience, that our old friends Murphy and Yeaney have been awarded a sole-source contract from GSA to help put contract and grant information into a public database. They are, GSA says, the only people who have the data.

Tim Signature
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