Tighten controls on federal contracting to combat waste, fraud

Monday, Sept. 12, 2011 | 2 a.m.

As the nation grapples with economic issues and its growing debt, here’s sobering news: At least $31 billion spent on government contractors has been lost to fraud or waste in Afghanistan and Iraq, according to a bipartisan federal panel.

In its recently issued final report, the Wartime Contracting Commission said the figure could be higher — as much as $60 billion of the estimated $206 billion spent on contracts over the past decade.

The report found a combination of reasons for the fraud and abuse, including poor planning, lax oversight, substandard contract management and shifting requirements.

Former Republican Rep. Christopher Shays, a co-chairman of the panel, said the situation is “troubling because U.S. doctrine has held for more than 20 years that contractors are part of the total force that would be deployed in contingencies.”

Yet, he noted, the government wasn’t ready to use a large number of contractors when it went into either Afghanistan or Iraq. “We are still not adequately prepared to use contractors to the scale required,” he said.

Given that, it’s no surprise that there are such problems. The lax oversight provided ample opportunity for fraud or abuse. Weak management meant several projects grew out of control. For example, an agricultural development program designed to pay for wheat seed and fertilizer in part of Afghanistan in 2009 was budgeted for $60 million. The report says the program quickly was expanded to a larger area and a larger mission — at a price tag of $360 million.

The commission also noted that the government was paying for things that the host countries likely wouldn’t be able to maintain, including facilities and infrastructure. The report noted that the government issued a contract for $82 million to design and build the Afghan Defense University — the country’s West Point. But the cost of the contract grew as the size of the military tripled. The commission was told it could cost as much as $40 million a year to run the university, which may be out of Afghanistan’s reach.

The report provides Congress with 15 recommendations for cutting waste in contracting operations. Members of the commission noted that some of those recommendations, like creating new oversight positions, will cost money. Shays acknowledged the tight times but said Congress shouldn’t hold back.

“With tens of billions of dollars already wasted, with the prospect of more to follow, and with the risk of recreating these problems the next time America faces a contingency, denial and delay are not good options,” he said. “They shouldn’t even be an option.”

Congress can’t let the report’s findings or recommendations go dormant. There has been too much money lost. Lawmakers need to take action to protect against fraud and waste in the future.