Section 809 Panel - Recommendation #49 - Provide Increased Flexibility to the Time Periods within which Contract Obligations are Permitted to Occur

Abstract

End-year contract obligation surges, spurred by a use-it-or-lose-it mentality, can lead to lower-quality requirements and contracts, inefficient allocation of resources, degraded negotiating leverage and pricing power, and a negative effect on workforce morale. The panel recommends congressional approval of a simple, small-percentage carryover authority for the Department of Defense's operations and maintenance (O&M) accounts. This proposal offers the best opportunity to deal with periodicity-related problems as a first step.