GAO: Agencies Missing Out on Billions in Contract Savings

October 4, 2012

Agencies missed an opportunity to save billions of dollars last year by underutilizing strategic sourcing programs that leverage the government’s buying power, a new report shows.

Four departments — Defense, Homeland Security, Energy and Veterans Affairs — account for 80 percent of federal procurement spending but used strategic sourcing programs for about 5 percent, or $25.8 billion, of their procurements, according to a draft report by the Government Accountability Office to be released Thursday.

Strategic sourcing essentially means bulk purchasing, and it requires that agencies commit to using one contract for certain products and services — such as office products or delivery services — so they can negotiate deeper discounts from vendors. Agencies can award their own strategic sourcing contracts or use governmentwide contracts that are part of the Federal Strategic Sourcing Initiatives, or FSSI.

 

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