For Immediate Release


Kirsten Stade (202) 265-7337

Pentagon In-Sourcing Plan to Reverse Bush Contracting Gains

Conversion of Over 33,000 Jobs Would Return to Military Contract Levels of 2000

WASHINGTON - Over the next four years, the Defense Department will convert
approximately half of its contracted functions back into civil service
positions, according to official guidance released today by Public
Employees for Environmental Responsibility (PEER).  This "In-Sourcing
Initiative" would cut military contracting back to 2000 levels, before
the outsourcing explosion during the Bush years.

In a
May 28, 2009 service-wide memorandum, Deputy Defense Secretary William
Lynn laid out a plan for "realigning resources for FY 2010-2014 to
decrease funding for contract support and increase funding for
approximately 33.4K new civilian manpower authorizations, 10,000 of
which are for the Defense acquisition workforce."  He concluded,
"In-sourcing is a high priority of the Secretary of Defense."

the Bush administration, spending on military contracting nearly
doubled to nearly $400 billion, consuming approximately 39 cents of
every defense dollar.  This in-sourcing plan would reduce contract
spending back to the levels of 2000, or approximately 26 cents of each
Pentagon dollar.  In a tacit admission that military outsourcing had
gone too far, the plan prioritizes the conversion of contracts for
"inherently governmental" functions which should never have been
contracted out for private performance in the first place.  It advises
commands to "in-source as expeditiously as possible" existing contracts
that -

  • Perform an "enduring mission requirement," a function which is needed beyond the contract term;
  • Had experienced "problems with contract administration"; or
  • Civilians could do more cost-effectively than contractors.

service has begun implementation of in-sourcing.  One such plan, from
the Air Force Materiel Command dated January 2010, contains draft
contract conversion orders and communication talking points for
affected "audiences (stakeholders)."  The Pentagon projects a "40%
savings for every contract-to-civilian conversion" a savings that the
Air Force Materiel Command discounts by half based on its "historic
savings in past cycles."

"The Pentagon is conceding that
the recent boom of military outsourcing proved to be a bust," stated
Jeff Ruch, Executive Director of PEER which successfully sued to block
total outsourcing of environmental work on domestic bases.  "Most
importantly, it is now officially recognized that excessive outsourcing
compromises both accountability and performance."

While the thousands of new civil service openings will be filled
through open merit system competition, as a practical matter the
current contractor employees performing the soon-to-be in-sourced
functions will have advantages in applying and competing for these

"Under Bush, military commands were graded on how much they could
outsource and now the services are being evaluated on the speed with
which they in-source," Ruch added.


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Public Employees for Environmental Responsibility (PEER) is a national alliance of local state and federal resource professionals. PEER's environmental work is solely directed by the needs of its members. As a consequence, we have the distinct honor of serving resource professionals who daily cast profiles in courage in cubicles across the country.

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