Senate bill would kill DOD performance pay, curtail sole-source contracts

The Senate has passed a bill that would end the National Security Personnel System and make it more difficult to award sole-source contracts. The measure would authorize spending $550.2 billion on Defense Department programs in fiscal 2010.

On Oct. 22, the Senate approved the fiscal 2010 National Defense Authorization Act’s conference report by a vote of 68 to 29; the House passed the bill Oct. 8. The legislation now goes to the White House for President Barack Obama’s signature. The conference report is a compromise between the House and Senate versions of the same bill.

The report contains an important provision to end the NSPS, a pay-for-performance compensation system for federal employees. The National Treasury Employees Union and others say NSPS curtails employee rights in the workplace, including the right to collective bargaining. 

Lawmakers want the program canceled by Jan. 1, 2012, according to the report. About 205,000 of DOD 's 865,000 civilian employees are in NSPS. Some federal employee unions also want the NSPS killed.

The bill also would make it more difficult for contracting officers to award sole-source contracts. The provision, which would apply governmentwide, would require contracting officers to explain why a sole-source contract of more than $20 million is in the government’s best interest.

Also, some lawmakers contend that contractors are being allowed too far into the inner workings of agencies and are coming too close to inherently governmental functions, or to work that only government employees can do.

As a result, they are requiring a review of those services to see if regulations and official guidance are keeping contractors in check.

Rep. Ike Skelton (D-Mo.), chairman of the House Armed Services Committee, said the conference report promotes Congress' main policy objectives, including “eliminating waste and recovering savings through acquisition reform, and maintaining robust oversight of [DOD].”