Small businesses share of fed contracting declines

Small business federal contracting is at its lowest level in decades, the American Small Business League reports.

According to the government's own figures, small businesses received only 17 percent of the total value of federal contracts during fiscal 2005. That's the lowest level of federal contracts awarded to small businesses in the past 20 years ' and represents a sharp decline from the previous year.

The Small Business Act of 1953 requires that small businesses get at least 23 percent of federal contracts, the ASBA said. SBA figures show that 23.09 percent went to small firms during FY 2004.

'The fact that the percent of small business contracts has dropped from 23 percent to 17 percent in only one year appears to indicate a lack of commitment by the Bush administration to offer small business owners a fair opportunity to do business with the government,' the ASBA said in a statement.

Lloyd Chapman, ASBA president, said 11 federal investigations and two private studies have found fraud, abuse and a lack of oversight in small business contracting. He said the SBA's own Inspector General uncovered outright fraud in small business contracting and in Report 5-15 called the diversion of federal small business contracts 'one of the biggest problems facing the SBA and the entire federal government today . . . .'

He said the IG report also charged the SBA with doing nothing to stem the growing use of large, multiple-award contracts that significantly lessen legitimate small businesses' opportunities to participate in the federal procurement process.

'This information should sound an alarm to small business groups around the country that President Bush is serious about shutting down the SBA. It's time for small business owners around the country to wake up and see what's happening and begin to fight,' Chapman said. 'President Bush is trying to end all programs that help small, women-owned, minority-owned, and veteran-owned businesses in order to divert more federal contract dollars to the defense and aerospace industries,' he added.

About the Author

David Hubler is the former print managing editor for GCN and senior editor for Washington Technology. He is freelance writer living in Annandale, Va.

Stay Connected

Sign up for our newsletter.

I agree to this site's Privacy Policy.