The Office of Management and Budget will no longer hold
agencies to governmentwide numerical targets for competitive
sourcing—including the goal of opening 425,000 federal jobs to
private competition—federal procurement chief Angela Styles said
In written testimony before the Senate Governmental Affairs
Committee, Styles said OMB has “moved away” from the
governmentwide numerical goals that have been part of OMB's
competitive sourcing initiative since its launch in March 2001.
Later, she told reporters that OMB had scrapped its goal of
competing 15 percent of all federal jobs deemed “commercial in
nature” by the end of fiscal 2003, and the ultimate goal of the
initiative, competing 50 percent of all commercial positions, or
The target of 425,000 jobs dates to the 2000 presidential
campaign, when President Bush called on federal agencies to let
private firms bid on half of all commercial jobs in government.
OMB's decision to eliminate uniform targets came about
gradually, Styles told lawmakers at the Governmental Affairs
Committee hearing. Over the past two and a half years, the
administration has noticed so many “exceptions to the rule” when
reviewing agencies' individual competitive sourcing programs that
it finally decided to drop broad percentage goals, she said.
Instead, OMB will set individual targets for the levels of
competitive sourcing feasible at each agency, and hold agencies to
their new customized targets. Many of these targets have already
been agreed upon during previous discussions about agency-specific
competitive sourcing initiatives, Styles said.
In theory, an agency could receive a “green,” or top mark, on
OMB's traffic-light scorecard for competing just 10 percent of its
commercial jobs, providing it had OMB approval, she told reporters
after a separate Thursday hearing of the Senate Energy and Natural
Resources Subcommittee on National Parks.
Until now, OMB has pushed most agencies to work toward placing
15 percent of positions designated as “commercial in nature” up
for competition, in order to earn a yellow light on the management
scorecard. For example, OMB upgraded the Defense Department to
yellow on its most recent scorecard, after the department competed
71,000 jobs to hit the 15 percent target.
Under OMB's new criteria, outlined in a report
to Congress issued Thursday, agencies will receive a yellow
light if they complete one competition that meets OMB standards.
In the past two quarters, they must have finished 75 percent of
all streamlined competitions—those where less than 65 full-time
equivalent jobs are up for bids—within a 90-day timeframe and have
canceled fewer than 20 percent of publicly announced competitions.
Agencies aiming for a green light must have completed at least
10 competitions after January 2001. Over the past year, agencies
deserving of the highest possible rating must have canceled less
than 10 percent of competitions announced, completed 90 percent of
all standard competitions in a year and finished 95 percent of
streamlined competitions within 90 days, OMB's modified guidelines
Despite the emphasis on finishing competitions within tighter
timeframes, agencies are at liberty to spend as long as they need
to plan competitions, Styles said. The clock only starts ticking
when agencies actually begin the competitions, she explained at
the Senate Governmental Affairs Committee hearing.
Lawmakers from both parties and federal employee unions have
attacked the concept of setting targets for competitive sourcing.
In a July 24 letter, Sen. Joseph Lieberman, D-Conn., asked OMB
Director Joshua Bolten to explain documents and internal memoranda
that purportedly demonstrate that OMB and federal agencies “have
been violating the law in pursuit of the administration's
pre-established numerical quotas for outsourcing.”
According to Lieberman, the administration's outsourcing
policies to date have “never been based on the circumstances of
individual agencies.” Instead, OMB set “arbitrary” competitive
sourcing quotas, he argued.
“When managed properly, equitable competition for new and
existing federal government work is one of several tools that can
help agencies reduce costs and become more responsive to customers
and taxpayers,” Lieberman wrote. “The administration's arbitrary
quantitative targets, however, chill other more creative means of
achieving cost savings.”
Colleen Kelley, president of the National Treasury Employees
Union, said she is skeptical that the agency-specific targets OMB
develops will differ much from the uniform 15 percent target
previously in place. “I'm not convinced that they're not just
trading one set of quotas for another,” she said. “I'm going to
watch this closely.”