DIIG Current Issues No. 34: FY2012 Federal Services Contracting Trends
August 27, 2013
Fiscal pressures related to the Budget Control Act have driven agencies to look to contracts as a as a source of potential savings. Accounting for 24 percent of total federal discretionary outlays, and 60 percent of total federal contract obligations in 2012, services contracts are a ripe source for savings. This has been born out, as services contract obligations declined by $24 billion between 2011 and 2012. Services contracting brings its own unique challenges relative to contracting for products, and there has been increasing awareness inside the government of the need to craft acquisition policy that accounts for those differences in order to better control costs.
In recent years, acquisition officials government-wide have focused reform efforts on a few specific initiatives: increasing competition, increasing the use of fixed-price contract types (and consequently reducing the use of cost-type contracts), and reducing management support contracts. This paper will first highlight some of the major trends in services contracting using FY2012 contracting data now available through the Federal Procurement Data system and USASpending.gov and then use this data to evaluate the success of these specific reform efforts in the last fiscal year.