These reports show that spending on services acquisitions is  increasing at a time when the acquisition workforce is decreasing. Since 1997, spending on services has grown 11 percent. 1). Agencies have to address governmentwide reductions in the acquisition  workforce. Section 201 of SARA would create a Chief Acquisition Officer (CAO)  within each civilian executive agency. By  granting the CAO clear lines of authority, accountability, and responsibility  for acquisition decision-making, SARA takes a similar approach as leading  companies in terms of the responsibility and decision-making authority of  these individuals. The program established by section 103 would allow  federal agencies to gain from the knowledge and expertise of private- sector professionals and entities. While we support the intent of this proposal—to make payments to  government contractors more timely—implementation of this provision  could result in increased improper payments and stress already weak  systems and related internal controls. This change would make it clear that such contracts are specifically  authorized for commercial services. Conclusion

The growth in spending on service contracts, combined with decreases in  the acquisition workforce and an increase in the number of high-dollar  procurement actions, create a challenging acquisition environment. It is  important that agencies have the authorities and tools they need to  maximize their performance in this new environment. The initiatives  contained in SARA address a number of longstanding issues in contracting  for services, and should enable agencies to improve their performance in  this area.
Why GAO Did This Study

Since 1997, federal spending on services has grown 11 percent and now represents more than 60 percent of contract spending governmentwide. Several significant changes in the government--including funding for homeland security--are expected to further increase spending on services. Adjusting to this new environment has proven difficult. Agencies need to improve in a number of areas: sustaining executive leadership, strengthening the acquisition workforce, and encouraging innovative contracting approaches. Improving these areas is a key goal of the proposed Services Acquisition Reform Act (SARA).

What GAO Found

The growth in spending on service contracts, combined with decreases in the acquisition workforce and an increase in the number of high-dollar procurement actions, create a challenging acquisition environment. It is important that agencies have the authorities and tools they need to maximize their performance in this new environment. The initiatives contained in SARA address a number of longstanding issues in contracting for services, and should enable agencies to improve their performance in this area. For example: (1) Section 201: Chief Acquisition Officers: Appointing a Chief Acquisition Officer would establish a clear line of authority, accountability, and responsibility for acquisition decisionmaking; and (2) Section 103: Government-Industry Exchange Program: A professional exchange program would allow federal agencies to gain from the knowledge and expertise of the commercial acquisition workforce. At the same time, GAO is concerned about some provisions in SARA. For example: (1) Section 211: Ensuring Efficient Payment: While GAO supports the intent of this proposal to make payments to government contractors more timely, GAO has reservations concerning its implementation. GAO's work shows that agencies have been hampered by problems such as high payment volume, inadequate payment systems, and weak controls.