Well duh. lol You guys don’t have to pay the pensions of contractors when their contract is done and the war is over. Of course the government loves to use this ‘disposable workforce’ called contractors.
Thanks to David Isenberg who brought this to everyone’s attention through his blog, and you can read his assessment here.
I do have an issue with the way GAO reworded the one instance that federal employees were more cost effective. Why training, vetting and recruiting costs were not included in this last one, is interesting. Is this because politically speaking, they are wanting to promote phasing out security contractors, and the GAO was pressured to write it that way? So instead of adding 240 million with the 162 million dollars to make the ‘grand total cost’ to the government for federal employee security specialists of 402 million dollars, they instead decided to stick with just the 240 million dollar figure? So in order to support their statement that security was not cost effective, they decided to split up the figure…(raised eyebrow) So with my simple math here, I show that private industry is more cost effective than the government for security work.
Also, I wonder if legal fees and lawsuits were tacked into the costs, because private industry is definitely eating that bill with this war. Just ask companies like Xe or DynCorp. And as more legislation is passed, which allows more people to easily sue private industry, and/or makes it more difficult to sue the government, I think this is another area that needs some attention in the accounting process here. A company has to have it’s own costly legal apparatus. The government has a massive legal apparatus already and oodles of laws to protect itself from litigation.
Just look at the dismal example of how many ‘few successful’ whistleblower cases there have been against government? Office of Special Counsel should be changed to the Office of Protect the Government. Not to mention all the lawyers assigned to protect the various agencies and departments out there. The government has a legal shield around it like you can’t believe, and all of it is funded by the tax payer.
Overall, this is a good publication to show folks as proof that we are more cost effective and we do make sense to the government. So if you are ever in an argument with some dork about the nuts and bolts of contractor efficiency, just pull this sucker up and let the GAO do your talking. –Matt
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GAO-10-266R March 4, 2010
Full Report (PDF, 20 pages)
Summary
In Process
Our comparison of likely State Department costs versus contractor costs for four task orders and one contract awarded by the State Department for security services in Iraq showed that for three of the task orders and the contract, the cost of using State Department employees would be greater than using contractors, while the State Department’s estimated cost to use federal employees was less for the other task order. For example, using State Department employees to provide static security for the embassy in Baghdad would have cost the department approximately $858 million for 1 year compared to the approximately $78 million charged by the contractor for the same time period. In contrast, our cost comparison of the task order for providing personal security for State Department employees while in the Baghdad region–which required personnel that have security clearances–showed that for this task order, the State Department’s estimated annual cost would have been about $240 million, whereas the contractor charged approximately $380 million for 1 year. However, because the State Department does not currently have a sufficient number of trained personnel to provide security in Iraq, the department would need to recruit, hire, and train additional employees at an additional cost of $162 million. Contract requirements are a major factor in determining whether contractors or government personnel are less expensive–especially factors such as whether personnel need security clearances. However, there are other factors that may play a role in the decision of whether to perform security services with federal employees or enough federal employees than to acquire contractors. Additionally, the government could potentially be faced with incurring some administrative costs from having to take actions to reduce government personnel if they are no longer needed. When using contractors, the department also incurs administrative costs for awarding the task orders and contract and providing oversight; however, the State Department was unable to estimate these costs. Finally, some costs associated with providing Iraq security services using federal employees–such as developing new career fields, providing additional overhead, and building new housing–are difficult to quantify.
Link to publication here.