Good morning. I want to thank Chairman Lieberman and Senator Durbin, who chairs the Subcommittee on the Oversight of Government Management, for calling today's hearing. I also wish to thank our witnesses for sharing their insights with us this morning. Lastly, I extend my appreciation to two of our witnesses, Colleen Kelley, president of the National Treasury Employees Union, and Bobby Harnage, president of the American Federation of Government Employees, for the work they do on behalf of their members.
September 11th has raised a new awareness of the importance of cost-effectiveness and accountability in government. Many agencies are now required to fulfill homeland security missions they had not considered just a year ago. To ensure that new and existing missions are met, we must make certain that agencies have the necessary people, skills and technologies to carry out their responsibilities.
Last week, I chaired an Armed Services Readiness Subcommittee hearing where we reviewed the achievements and challenges of federal acquisition. I want to welcome Angela Styles, who testified in last week's hearing. I enjoyed our discussion last week and look forward to working with you on these issues. While we have made progress in making our government acquisition system more responsive to the commercial environment, we continue to see significant shortcomings in DoD's management of its $53 billion in services contracts. Moreover, contract management and acquisitions have been identified as high-risk areas by GAO.
There are a number of actions we need to take to meet these challenges: We need to achieve transparency of costs - both in government and among federal contractors. To do this, we must work to improve the management of contracts and the collection of timely and accurate information about those who perform the work. We must stop erroneous and improper payments to contractors. For example, between FY94 and FY98 defense contractors returned $4.6 billion in erroneous payments to the Department of Defense.
We must ensure that the government has the people and tools they need to determine costs for both government and contracted out activities over the long-term.
Contracting out for goods and services raises fundamental questions of accountability at a time when we are demanding more from federal employees whose jobs and responsibilities are expanding. One of our witnesses today, Mr. Dan Guttman, points out that there are approximately 2 million federal employees and 8 million employees who work for the government on grants and contracts. Who are these contracted workers, and who are they ultimately accountable to? What are the long-term costs of contracting out, both in terms of money spent and the effect of losing in-house expertise? What are the national security consequences of this?
Over the past decade, the federal workforce has been dramatically cut at a time when agency homeland security missions were not as obvious as they are today. Do we know if the federal government has the people it needs to accomplish these new missions? How much institutional knowledge are we losing by cutting the federal workforce through outsourcing? I hope our witnesses can address these questions.
We must learn from the past and avoid the same kind of procurement abuses that accompanied previous episodes of rapid budget growth, like the spare parts scandals that plagued the Department of Defense in the 1980's. In the face of broadened and more complex agency missions, resources are too scarce to allow this to happen again.
Because of limited resources, we need to make sure that federal contractors achieve cost-effectiveness and are accountable to the agencies they serve.
I wish to express my appreciation to our witnesses again for their testimonies.
