The expose by the Post's reporters on the waste in federal government procurement is an extension of the General Services Administration scandals with which we have been surfeited over the past several years. But what has the administration or Congress done to control and reform this procurement process?
Sen. Lawton Chiles (D-Fla.), the comptroller general of the United States, and others who have studied federal procurement, have estimated that from $25 billion to $60 billion is lost annually through mismanagement, fraud and waste. The latter estimate is almost one-tenth of the projected federal budget.
The federal government has long been aware of the need for procurement reform. In the late '60s, the president appointed a Commission on Government Procurement. Its final report was published in December 1972. In 1976, an adminstration bill and a bill developed by a subcommittee chaired by Sen. Chiles were considered. Both bills endorsed and implemented the salient recommendations of the commission report. After four years of hearings, the draft of a Federal Acquisition Reform Act still has not reached the floor of the Senate.
An Office of Federal Procurement Policy -- recommended by the president's commission -- was created in 1973 in the Office of Management and Budget to propose reform regulation and legislation for the procurement process. It has spent most of its time papering the process with additional or revised regulations. It has refused to give credence to the orgy of year-end spending by agencies -- when the greatest volume of wasteful contracts is made. Waste is beyond its ken: agencies are given rules to go by, and the purchase of products and services is a decision for the procuring agency. To date, the administration has urged its agencies to use the utmost discretion and good judgment, but it has never mandated a practical solution to the waste that proliferates daily. Congress is the last resort.
After World War II, Congress took three years to study the procurement problems that emerged during the critical war years and to pass the Armed Services Procurement Act (1947) and the Federal Property and Administrative Services Act (1949). Seven and one-half years have passed since the December 1972 report of the Commission on Government Procurement, with no reform legislation. Sen. Chiles has introduced the most comprehensive bill, but, after numerous hearings since 1976, nothing has been considered on the floor of the Senate. This legislation has been referred to the Office of Federal Procurement Policy, and a report on it is anticipated by October 1981. Congress may be considering it in 1982.
Sen. David Pryor (D-Ark.) and Rep. Herbert E. Harris II (D-Va.) have introduced stopgap legislation to curb the wasteful year-end spending spree by agencies. But a 20-percent limitation on expanditures in the last two months of a fiscal year will only move the spending spree to the ninth and tenth months. Rep. Burton (D-Calif.) is attempting to reform the contracting procedures and contract supervision practices of the federal government. His amendments to the Federal Property Act would penalize contractors for fraud and abuse of contract procedures, require more stringent accountability and mandate minimum and levels of audit scrutiny.
The underlying problem, of course, is discipline in the procurement process. What is needed is not just an absence of corruption by the parties involved, but a clear mandate to the contracting officers, program personnel and their staffs that if a project proposal for a product or service is unnecessary, it will be rejected. This appears to be over-simplification, but it is a critical test of what is or is not wasteful. Since a prejudgment of every proposal by someone other than the contracting officer is not practical, a sanction must be found for gross mistakes of judgment. An effective sanction, which would reduce the acency's appropriated funds, would evaluate the end product of a questionable procurement and reduce the agency's next annual appropriation by the dollar amount of the wasteful expenditure of funds. Such a sanction would encourage termination of contracts that were proving useless and would impose the discipline of accountability where it belongs. The inspectors-general in each agency would be the logical ones to supervise such evaluations.
Waste in government is a fact; the current newspaper exposes make this irrefutable. But it not an inevitable part of doing business with the government. There are many solutions, most of which can be effective only if they have the sanction of statutory law. Perhaps a national referendum on the November ballot could afford the elderly, the unemployed and other underpriviledged Americans the opportunity to tell their representatives in Congress how much they would like to see the $60 billion, which is being wasted, funneled in their direction.
No American entrepreneur could profitably conduct his business in such a haphazard way. A trial-and-error system with useless end products is a profligate waste of taxpayers' money.
To borrow from President Carter's characterization of his energy program as the moral equivalent of war, the federal procurement process -- or mess, if you like -- is the marketplace equivalent of depravity.