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Washington, D.C. — Legislation introduced today in the House and Senate would bring about long overdue and much needed reform of the federal A-76 contracting out process, said the leader of the National Treasury Employees Union (NTEU). NTEU President Colleen M. Kelley praised the CLEAN UP Act, introduced by Rep. John Sarbanes (D-Md.) and Sen. Barbara Mikulski (D-Md.), as a practical step to reduce waste in government contracting and return work to the hands of federal employees.

“Federal employees have proven time and time again to be more effective and efficient than the private sector at delivering services the American people rely on,” Kelley said. “With the CLEAN UP Act, federal employees will have a fair opportunity to compete with the private sector for certain government work, while also ending the contracting out of inherently governmental work that should only be done by accountable federal workers.”

The CLEAN UP legislation, formally known as the Correction of Longstanding Errors in Agencies Unsustainable Procurements Act, would ensure that inherently governmental work is actually performed by federal employees; encourage agencies to give federal employees opportunities to perform certain types of outsourced work, including work that was contracted out without competition; and would reform the Office of Management and Budget (OMB) Circular A-76 privatization process.

“NTEU fully recognizes that, in the current fiscal crisis, it is important that the federal government look for ways to maximize its resources and to root out waste, fraud and abuse,” Kelley said. “One way is to reform the broken competitive sourcing process and bring contracted work back in-house.”

With the support of some in Congress, the previous administration rewrote the A-76 rules governing competition between private contractors and federal employees for government work, despite objections by NTEU that the new regulations favored outside companies and would result in poor performance and wasted taxpayer dollars.

This is what happened at the Internal Revenue Service when a private contractor announced it could not begin work on schedule under a $103 million contract for receiving, filing and maintaining tax returns and other tax-related documents. That left the IRS scrambling to staff the job after spending months transferring its own employees out of the work. It took nearly 16 months for the contractor to assume all its contractual obligations. Two years later, the IRS canceled the contract amid reports by agency employees of lengthy delays in retrieving information they needed to do their jobs.

“Despite the lessons of recent history, some are arguing that reducing the federal workforce would generate savings and would not result in inferior service,” Kelley said. “Proponents of contracting out disregard the fact that any savings generated would simply be shifted to private contractors who generally cost more, are less accountable, and are unable to do the work as well or as efficiently as federal workers.”

NTEU’s concerns about the flawed A-76 process were supported by a Government Accountability Office report that showed that the Office of Federal Procurement Policy is understaffed and its repository of contractor performance information is underutilized, resulting in agencies making uninformed decisions and awarding contracts to companies with poor performance histories. Additionally, OMB reports that excessive reliance on contractors has eroded the in-house capacity of agencies to perform critical functions, undermining their ability to accomplish their missions.

NTEU is the largest independent federal union, representing more than 150,000 employees in 31 agencies and departments.