It's a trickle now, but DoD is gradually bringing work back in-house. And the reason? To lower costs. It seems like, oh, so six months ago, that the government still kept up the drumbeat that privatizing was always better. So it feels startling to see government documents that state doing work in-house saves money. But there it is.
Just a few days ago, I reported on a speech by Defense Secretary Robert Gates on the FY 2010 budget and his commitment to convert thousands of contractor jobs into government jobs . . . in order to save money. Well, it also reported on continuing privatization at West Point and opposition by the American Federation of Government Employees (AFGE).
Now we have an announcement on bringing back in-house more contracted-out work. The basis for this announcement is a memorandum from a year ago. A puzzling memo, given who was in charge then.
This was an April 4, 2008 memorandum on implementing section 324 of the National Defence Authorization Act for FY 2008 directed the development of guidelines and procedures to ensure that DoD civilian employees perform new functions and functions performed by contractors. It also has other restrictions on the use of contractors. These changes were implemented in order to "reduce workforce costs, realign inherently governmental and exempt functions for goverment performance, and manage more efficiently and effectively."
On April 20, 2009, Defense Finance and Accounting Service (DFAS) officials announced:
they have decided to transition Department of Defense Retired and Annuitant (R&A) pay functions to a government run operation performed by DoD civilian workers in early 2010. Currently this worked is performed by an outside contractor."
The memorandum continues:
The DFAS conducted a Business Case Analysis to determine if R&A pay was a viable candidate for in-sourcing.
According to DFAS Director Terri McKay, the BCA concluded in-sourcing R&A pay was the preferred solution.
“The study showed bringing this work back in-house would result in savings of more than $20 million over the next 10 years, provide improved flexibility and reduce risks to operations, and finally would allow us to sustain and potentially improve service delivery and customer satisfaction,” said McKay.
Plans call for an orderly transition from the contractor to a government managed and operated R&A function effective in early 2010.
Gradually, it is not the same ol' same ol'.
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