OMB Updates Plans on Consolidating Federal Procurement
The Office of Management and Budget (OMB) released a memo to help agencies comply with President Trump’s executive order on consolidating the federal procurement process. That order told agencies to make the General Services Administration (GSA) the lead for domestic procurement for common goods and services, in a bid to save money and eliminate waste.
The memo tells agencies to work “proactively” with OMB and GSA to allow for the “optimization of contract value through smart, aggressive consolidation of buying activities for common goods and services.”
It notes that GSAs best in class contracts have yielded “significant savings and cost avoidance.”
What to Consolidate?
When it comes to consolidation, OMB notes that contracts are easy to standardize, are not agency specific, are not customized, and allow achievement of economy and efficiency are the top candidates for consolidation.
“Many, but not all, common requirements are highly suitable for consolidation,” stated the memo.
Two Consolidation Workstreams
OMB also introduced two workstreams for the consolidation efforts.
The first focuses on increased use of centralized contracts, with agencies told to use government-wide contracts first.
“Common sense dictates that agencies should routinely use existing government-wide contracts that can meet their needs before undertaking the time and expense of creating a new contract on the open market,” stated the memo.
OMB told governmentwide category managers to coordinate with the Category Management Program Office to assess spending and offer recommendations for additional consolidation.
The second workstream focuses on opportunities to consolidate through the centralization of procurement functions at GSA, essentially making GSA the procurement hub for agencies’ common purchases.
The memo spells out conditions for GSA and OMB to consider when evaluating whether an agency’s procurement functions can be transferred to GSA. Those include capacity, assessment, cost efficiency, risk management, performance monitoring, service level agreements, and budget impacts.
“Effective implementation of the workstreams outlined above should help GSA optimize value for the American taxpayer and improve the efficiency and effectiveness of acquisition activities across the Federal Government,” said OMB Director Russell Vought.
