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Federal Contract Abuses on the Rise
From Forbes June 28, 2007 Back

 

Federal Contract Abuses on the Rise


BY Associated Press
Staff Reporter

A House committee released a report that found more than half of government contracts in 2006 were awarded with limited or no competition, an increase from the year before.

Rep. Henry Waxman, D-Calif., chairman of the House Oversight and Government Reform committee, on Wednesday released a report critical of government spending and contracting trends, specifically the rise in noncompetitive contracts being awarded.

The report is based on data from government contracts provided by Eagle Eye Inc. and audits and investigations by the Government Accountability Office. Eagle Eye used data from 1999 through 2006 compiled by the government to track federal contracts.

The report found that federal spending in 2006 rose by 9.2 percent to a record high of $412.1 billion. More than 50 percent, or $206.9 billion, was awarded by the federal government without a competitive bidding process or through limited competition, roughly 12 percentage points higher than 2005 results.

In 2005, out of the $377.5 billion in contracts awarded, 38.4 percent were awarded without a competitive bid or through limited competition.

Roughly $1.1 trillion in federal contracts have been identified by government audits and investigations as being involved in fraud, waste or abuse. The number of contracts in this category ballooned to 187 in 2006, compared to 118 from the previous year.

The top six recipients of federal contracts are Lockheed Martin Corp. (nyse: LMT - news - people ), Boeing (nyse: BA - news - people ) Co., Northrop Grumman Corp. (nyse: NOC - news - people ), Raytheon Co. (nyse: RTN - news - people ), General Dynamics (nyse: GD - news - people ) Corps. and Halliburton (nyse: HAL - news - people ) Inc.

© 2007 Forbes All rights reserved.

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