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OMB will push some agencies to surpass outsourcing targets

Some agencies should prepare to surpass a Bush administration target for opening more federal jobs to private sector competition, Office of Management and Budget Director Mitch Daniels said Tuesday. Speaking before an audience of contractors at a conference sponsored by the Contract Services Association, Daniels said OMB would push certain agencies to let the private sector compete in fiscal 2002 on more than 5 percent of all federal jobs considered commercial in nature. The 5 percent target is a baseline that some agencies should exceed, Daniels said. "We want a business plan for this where units with higher [outsourcing] potential are given higher targets," said Daniels. "Some agencies have a tremendously big upside for competition," he added, citing the Interior and Agriculture departments as examples. The Interior Department continues to perform routine maintenance and training activities that could be provided by the private sector, according to Daniels. "Interior has been described as the world's largest lawn care service," he said. Daniels mentioned routine maintenance, janitorial, and training services as examples of functions that could easily be performed by the private sector. OMB will also work to expand the pool of federal jobs that are eligible for competition by scrutinizing agency inventories of commercial jobs, Daniels said. Under the 1998 Federal Activities Inventory Reform (FAIR) Act, agencies must compile annual lists of jobs that could be performed by contractors. Daniels said the Justice and Interior departments and the Environmental Protection Agency had submitted incomplete FAIR Act lists in 2000. "Some of these lists need work," he said. "At the Environmental Protection Agency, [only] 4 percent of 18,000 jobs were on the [2000] list." Agencies submitted the first round of 2001 FAIR Act inventories to OMB last month. While OMB competitive sourcing targets apply only to work being performed by federal employees, Daniels said the Bush administration is open to allowing public employees to compete for work being performed by contractors. Agencies currently have the authority to let in-house workers participate in such competitions, he said. When asked if OMB would require agencies to conduct public-private competitions on work done by contractors, Daniels replied, "I haven't thought about that." Daniels also reiterated the Bush administration's opposition to union-backed legislation that would allow federal employees to compete for virtually all government contracts. "My nominee for the most poorly conceived bill of the year is something called the Truthfulness, Responsibility and Accountability in Contracting [TRAC] Act," he said. An official with the American Federation of Government Employees blasted Daniels' statement. "It's a sad commentary on the extent of contractor influence on OMB that the director would oppose legislation that would ensure better tracking of contractor costs and more public private competition, because both elements of the TRAC Act have the potential to save taxpayers large amounts of money," said John Threlkeld, a policy analyst with the union.