DOD contracting problems spread to Interior, Treasury, GAO says

The Defense Department's contracting troubles are not limited to the General Services Administration's Federal Technology and Federal Supply services. A recent Government Accountability Office report found DOD used the Interior and Treasury departments' interagency procurement services'GovWorks and FedSource'and overpaid or watched as contracts were awarded with little or no competition.

Auditors reviewed 17 DOD projects worth about $249 million and found Defense did not always get 'the full benefits of competitive procedures,' and Interior and Treasury did not 'ensure fair and reasonable prices and may have missed opportunities to achieve savings on millions of dollars in purchases.'

The report follows a rocky two years where DOD and GSA came under fire from GAO, inspectors general and Capitol Hill for questionable uses of interagency contracting vehicles.

DOD, which bought more than $1.2 billion worth of goods and services from GovWorks and FedSource in fiscal 2004, also did not perform contracting analyses to determine whether using GovWorks and FedSource made the most sense.

'DOD also lacks basic information about purchases made through franchise funds,' auditors said. 'Without this data, it is difficult to assess whether franchise funds' contracting services provide DOD value.'

Auditors also found DOD, GovWorks and FedSource failed to follow proper, sound contracting practices.

'DOD did not provide [GovWorks and FedSource] with detailed information about their needs,' GAO said. '[GovWorks and FedSource] did not translate DOD's needs into well-defined contract requirements that contained criteria to determine whether the contractor performed successfully.'

GAO recommended a series of changes for DOD, GovWorks and FedSource. All three agreed with auditor's suggestions and have started making changes.

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