Links
Stimulus Watch: No-bid contracts mean higher costs
The Defense Department frequently awards no-bid work to small contractors for repairs at military bases under the new economic stimulus law, costing taxpayers millions of dollars more than when businesses compete for the work, according to an Associated Press analysis of 570 such contracts.
The Pentagon saves more than three times as much money when companies compete, the AP analysis showed. Yet more than $242 million in federal contracts–representing more than one-fourth of the military's stimulus contract spending so far–has been awarded under the recovery program through no-bid contracts for repairs and maintenance.
President Barack Obama promised last month to save money through competition.
"By ending unnecessary no-bid contracts and reforming the way government contracts are awarded, we can save the American people up to $40 billion every year," Obama said, as he announced new procedures to increase competition.