April 25, 2006
Jason Fornicola
(202) 639-6448

AFGE Highly Critical of New OMB Report

Washington—The American Federation of Government Employees (AFGE) strongly denounced today the Office of Management and Budget’s (OMB) report to Congress that claimed that “competitive (sic) sourcing” produces any benefits for either agencies or taxpayers. The OMB report describes the methodology behind setting up public-private competitions. However, AFGE National President John Gage asked, “How can it be determined that taxpayers are benefiting from competitive sourcing when all savings are ‘projected, estimated, forecasted or expected’?” To date, there have been no audited, actual savings documented from the date ranges (FY03 – FY05) covered in the report. Furthermore, the Comptroller General has said repeatedly that agencies lack the accounting systems necessary to determine costs and savings from contracting out.

Additionally, AFGE opposes OMB’s insistence that its controversial “best value” (sic) privatization process is in the best interest of the taxpayer. OMB has acknowledged that this process benefits contractors. “In trying to drum support for ‘best value’ (sic), OMB is attempting to overturn the painstakingly crafted bipartisan compromise included last year by the Congress in the Transportation-Treasury-HUD Appropriations Bill. Identical language has been included in the Defense Appropriations Bill since FY04. Even stronger language was included in the FY06 Defense Authorization Bill. All three public-private competition requirements provide the best of both worlds in the provision of services: Agencies get to determine what quality standards should be established and taxpayers get services provided at the lowest possible cost,” said John Threlkeld, Legislative Representative for AFGE.

Gage also pointed out the inadequate supervision of contractors, saying, “OMB’s quality control efforts appear to be, based on this report, devoted exclusively to following up on winning in-house workforces, instead of checking up on poorly-performing contractors.”

In looking out for not only AFGE members and employees but also the American public, Gage added, “AFGE warns taxpayers to be cautiously optimistic of OMB’s competitive sourcing initiative, as it continues to be inconsistent and one-sided in favor of contractors.”

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