U.S. Automatic Cuts Send Pentagon Contract Awards Down 52 Percent
May 12, 2013
Pentagon contracts tumbled 52 percent in April from a month earlier as across-the-board federal budget cuts took hold.
The Defense Department announced awards with a maximum value of $19 billion in April, about 22 percent lower than a year earlier, according to procurement data. The biggest contract, a $6.9 billion network equipment deal, was won by a group of eight companies led by General Dynamics.
The military is scheduled to absorb $37 billion in cuts this year under the reductions known as sequestration. The contract slowdown is “undoubtedly tied to sequestration’’ and reflects an even sharper drop in awards than mandated under the cuts, said Larry Allen, president of Allen Federal Business Partners, a consulting company in McLean. In March, the Pentagon awarded $39.4 billion in contracts.