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Project on Government Oversight




White House Should Stop Excessive Executive Compensation on Federal Contracts

April 23, 2010 


Yesterday the Project On Government Oversight (POGO) sent a letter to Office of Management and Budget (OMB) Director Peter Orzsag and Jared Bernstein, the Assistant to the Vice President for Economic Policy, urging them to lower and extend compensation limits for all federal government contractor employees.

"If the Obama Administration wants to limit executive compensation for Wall Street, why aren't they stopping excessive executive compensation for government contractors? Don't the taxpayers deserve that?" asked POGO Executive Director, Danielle Brian.

On Tax Day 2010, OMB published its annual contractor "benchmark" compensation limit -- $693,151 -- the amount that may be priced into, or reimbursed under, government contracts.  The limit does not apply to all government contractor employees, but only a small group of top executives.

In the letter POGO urged OMB, through the Federal Acquisition Regulatory Council, to extend the current FAR rule to limit allowable costs to all contractor employees, and not just to the top five executives at each contractor home office and segment location. Furthermore, POGO pointed out that the nearly $700,000 limit is ridiculously high, especially during these difficult economic times.

Founded in 1981, the Project On Government Oversight (POGO) is a nonpartisan independent watchdog that champions good government reforms. POGO's investigations into corruption, misconduct, and conflicts of interest achieve a more effective, accountable, open, and ethical federal government.

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