GAO: Acquisition planning must include cost estimates, best practices

Tuesday - 8/9/2011, 5:07pm EDT

By Jolie Lee
Federal News Radio

The top four civilian agencies can do a better job in the planning stages for service contracts, according to a new Government Accountability Office report.

GAO evaluated the contract planning at NASA, USAID and the Departments of Homeland Security and Health and Human Services.

Governmentwide, civilian agencies obligated more than $135 billion in FY 2010 for service contracts. That's 80 percent of total civilian contract spending, according to GAO.

The key elements of acquisition planning include:

  • Written acquisition plans
  • Requirements development
  • Cost estimation
  • Lessons learned

GAO found the four agencies were not incorporating cost estimation and lessons learned as important parts of the planning process.

"Moreover, agencies varied in how they documented rationales for cost estimates prepared during acquisition planning and any lessons learned, which limits the availability of such information for future use," according to the GAO report.

Budget cutbacks have made cutting wasteful spending more pressing for agencies. Senate Homeland Security and Governmental Affairs Committee Chairman Joe Lieberman (I-Conn.) said the GAO report comes at a "critical point in our fiscal history."

"The report shows that planning for a contract is just as important to its outcome as negotiating and managing it. The federal government must determine what it really needs to buy, how it's going to buy it, and what it should pay - BEFORE a contractor is hired. If agencies clearly define what they are buying and what they can afford, taxpayer dollars will be saved in the long run," Lieberman said in a statement.