Department of Defense officials have spent more than $70 billion on contracts for which they can’t document that the government paid “fair and reasonable” prices.
The DOD inspector general said in a report made public Friday that the Defense Contract Management Agency failed to create properly documented case files required by Federal Acquisition Regulations to document purchases at eight major contractor locations.
Among the contractors included in the audit were facilities for Northrop Grumman, Boeing, General Atomics, Raytheon, Lockheed-Martin, BAE, L-3 and Bell Helicopter-Textron.
The eight have contracts worth more than $21 billion and are considered representative of the 353 contractor locations from which the government obtains the $70 billion in defense goods and services.
Defense contract officers are required by FAR to use multiple techniques for documenting the reasonableness of prices proposed by contractors.
But the DOD IG found that in all eight of the audited locations, Pentagon contracting officers failed to do so.
The IG said DCMA officials should take steps to correct the problem and that doing so would insure that “DoD contracting officers will be better positioned to negotiate fair and reasonable contract prices for the government and taxpayer on at least $70 billion in negotiated government sales.”
Go here to read the full DOD IG report.
Mark Tapscott is executive editor of the Washington Examiner.
