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Project on Government Oversight

Contract Oversight

In order to ensure that contractors supply the government with the goods and services agreed to under the financial terms and programmatic requirements outlined, it is important that the federal government conduct proper oversight of contracts. Good oversight holds contractors accountable; poor oversight often leads to waste, fraud, and abuse of taxpayer dollars. POGO’s Contract Oversight Investigations are aimed at preventing billions of dollars from being wasted and defrauded from the $530 billion annually spent by the government on goods and services.  Click on the program areas below to learn more.

Arm's Length Negotiations
Cozy government-contractor relationships have been attributed to many instances of waste and abuse. To make every effort to get the best value for the taxpayer, the government must promote aggressive arm's-length negotiations with contractors.

Competition in Federal Contracting
To better evaluate goods and services and to get the best value, the government must encourage genuine competition between contractors. Competition in contracting also prevents waste, fraud, and abuse, because contractors know that they can be replaced if they do not perform at the highest levels. The government must ensure that full and open competition is the rule, rather than the exception.

Contract Auditing
Contract auditing helps to protect taxpayers at the different phases of the contracting process -- before contracts are awarded and after contractors have submitted billings -- to ensure that taxpayers do not pay contractors for expenses that are unreasonable, unsupported, and/or excessive.

Contractor Accountability
To ensure that taxpayer dollars are being spent responsibly the government must regularly monitor and audit contracts. Contract administration should not end after the contract is awarded -- taxpayers deserve more.

Cost Accounting Standards
Cost accounting standards are used to increase the uniformity and consistency of cost accounting data supplied by contractors to the government for the purposes of assisting in negotiating, pricing, or administering contracts. Such rules are especially crucial to prevent the use of accounting gimmicks in a frequently noncompetitive environment.

Earmarks circumvent the merit-based or competition allocation processes, frequently specifying the location or recepient of government funds. It is important that earmarks be transparent in order to prevent corruption by allowing taxpayers to hold legislators and senior policymaker accountable for government spending decisions.

Federal Contracting Resources
Government contracting is complex and difficult to navigate. For years, POGO has been directing people to various internet resources that help them learn more about how the federal government is spending hundreds of billions of dollars. POGO's contracting resources page includes links to federal agencies, private entities, and government watchdogs that follow federal contracts and grants, government investigative reports, campaign contribution data, and ethics information.

Federal Contractor Misconduct
Contractor misconduct is a term used by the Project On Government Oversight (POGO) to highlight instances when companies that sell goods or services to the government violate laws or regulations, or are accused of wrongdoing in its dealing with the government, persons, and private entities. POGO has compiled this Federal Contractor Misconduct Database (FCMD) because there is no government repository for contractor misconduct information.

Federal Grants
In awarding federal grants, it is standard practice for a federal agency to require that a competitive grant proposal go through a peer review process in order to evaluate the merit of the application.  POGO investigates and challenges cases in which grants are awarded to specific locations or entities based on congressional earmarks, favoritism, or cronyism.  

Government Privatization
Federal contract spending has doubled since 2000, totaling roughly $530 billion in FY 2008. This trend has been fueled in part by the idea that private entities are better equipped to provide goods and services more efficiently and at lower costs than government employees. The government's growing reliance on contractors raises concerns about federal spending and the control of the government. The government must confirm that contractors are not performing inherently governmental functions, which must be performed by civil servants.

Human Trafficking
Despite Presidential Directives and DoD guidance, POGO believes that trafficking in persons (TIP) continues to take place in Iraq and other countries where U.S. contractors for both civilian agencies and the U.S. Military have interests. In addition to the human rights aspect of the TIP problem, there is now a contracting element that POGO is following.

Iraq & Afghanistan Reconstruction Contracts
Iraq & Afghanistan reconstruction efforts have been riddled with waste and abuse, including poor planning, acquisition workforce problems, security issues, and lack of accountability and transparency. These problems were compounded because of the escalating cost of the War on Terror. POGO continues to looking into reports that American taxpayers are getting a bad deal.

Katrina Contracting
The federal government's response to the Katrina Hurricane cost taxpayers over $100 billion -- much of it going to contractors doing everything from addressing short term needs like food and shelter to repairing public water works systems. The relief effort was riddled with problems with sole source contracts, outrageously high charges, and questionable expenses. Many of those same problems are returning in the Katrina rebuilding effort. POGO is looking into numerous cases that highlight big picture contracting problems.

Katrina Extras

Lead System Integrators
Recent reports have surfaced about the inherent problems with having contractors control and oversee billion dollar government programs. Some experts say that the government isn't capable of managing those projects. POGO disagrees - government control of programs is essential to ensuring that private interests aren't driving the public bus.

Risky Contract Vehicles
To prevent abuse, the government must ensure that risky contract types that have been abused in the past are only used in limited circumstances and are accompanied by audit and oversight controls.

Small Business Contractors
POGO receives information from many sources about how large contractors dominate the contracting system. If given the opportunity, small, minority-owned, and women-owned businesses can supply goods and services to the taxpayers at the same or a better value than large contractors. Too often contract bundling delegates small businesses to subcontracting roles. The federal government must ensure that a level contracting playing field exists for all contractors.

Third-Party Financing
The use of private parties to finance large-scale public projects often costs more than if the government chose to fund the project directly, because of the inherently higher cost of financing through the private sector.  POGO typically promotes direct government funding as a more cost-efficient and accountable mechanism.  

Transparency in Contracting
To regain public faith in the contracting system, the government must ensure that the contracting process is open to the public, including contractor data and contracting officers' decisions and justifications. Many people claim that "sunshine is the best disinfectant," so let's shine some light onto the complex, dark world of federal contracting.