Contingency Contracting Failures: It's About the People

The big story before the Labor Day holiday was the release of the final report by the Commission on Wartime Contracting in Iraq and Afghanistan (CWC). According to the Project on Government Oversight (POGO), the enormous dollar volume of waste and the assumption of the over-reliance on contractors for contingency operations was the focus of the report. I very much respect POGO's work, but I respectfully disagree.

The major issue is the quality of the acquisition workforce. In agreement was Sen. Claire McCaskill (D-MO), who stated that two areas in the report that jumped out to her was the Defense Department culture and the lack of qualified and too few contracting professionals as main reasons for the waste. Although I normally focus on quality, it was the quantity on this issue that was also a major failure.

..."I think the dirty little secret that has now been exposed-in fact this goes governmentwide and not just in wartime contracting-is that if you don't have the personnel that work for the federal government, rather than increase the personnel and the costs associated with that, go out and contract," she said. "This has occurred to a large extent in the Department of Homeland Security, it's occurred in a number of places and we have been doing that while we have hollowed out our acquisition personnel. We need to make investment in government employees that know how to police this and we frankly have dropped the ball in that regard."...

What the report simply fails to address is the political realities made with these decisions. Hearts and minds needed to be won, and thus materialized the pictures in Iraq of U.S. personnel sitting a top pallets of U.S. currency, handing it out like candy to win favor in line with local cultural norms. In Afghanistan, bounties were paid to find "terrorists,"so locals sold their neighbors up the river to win favor with the U.S., make more money than they ever have before, and take over land and settle old scores. Warlords also were paid off, although sympathies to al Qaeda and Taliban forces continue to be difficult to determine. How much waste went to the enemy? Perhaps that is the $30 Billion that the report mentions in possible unaccounted for waste. Any oversight with these issues?

The realities for personnel are that contingency contracting may be one of the most difficult areas of contract management, as local customs and norms may interfere with transparency and oversight, making the glaring lack of adequate training even more difficult to comprehend. Further, how many people across Defense, State, and USAID have any formal training? Obviously not enough. It got so bad that Defense was actually considering giving every lowly grunt going into theatre some form of contract training!

Coordination and collaboration across these agencies means creating a Contingency Contracting Corps, shared among the agencies, that can perform the contingency contracting mission across the globe. They would be the "special forces" of contracting; the tip of the spear to ensure accountability to the taxpayer. This of course requires a massive overhaul in the training curriculum available to the acquisition workforce, which of course needs to include revamping services contracting and commercial item acquisition. A much broader skill set would also need to be considered, one that needs to be factored in for hiring or designation to this mission.

After 10 years of war, and the 15 strategic recommendations made by the Commission, I hope that Congress understands the issues at stake. We need to invest in the acquisition workforce, and fully fund these initiatives that can have vast returns with upfront investments. I would like to think that government management of this scale would easily be an election year issue, but perhaps it will not make effective sound bites.

When the Lack of Oversight on Government Contracts Has Dire Consequences

One of the most blatant examples of contractors running amok with little to no oversight has come to light recently as a result of an investigation and subsequent report by the Project on Government Oversight (POGO). This report was created based on information from current and former employees of ArmorGroup North America Inc., hired to protect the U.S. embassy in Afghanistan. The report and subsequent information provided by POGO is something that one would fine by cross pollinating a Stephen King novel with Lord of the Flies, where security contractors were forced to participate in a variety of lewd activities, hazing, and other lascivious acts or risk losing their jobs. Although the behavior by ArmorGroup personnel is inexcusable and leaves ones bereft for words, the real issue is how this happened, and how it could have been prevented.

According to the POGO report, concerns about the ArmorGroup contract have been addressed by the State Department, which administers the contract, for over two years. These concerns repeatedly addressed a pattern of security violations, a pervasive breakdown in the chain of command, and discipline and morale issues.

…In July 2007, State issued a "cure notice," advising the firm of 14 specific deficiencies that were endangering the performance of the contract, including failure to provide an adequate number of guards, relief personnel and armored vehicles. Officials sent another cure notice in April 2008. But two months later, State decided to extend the contract for an additional year...

…This environment has resulted in chronic turnover by U.S./ex-pat guards. According to the State Department, "nearly 90% of the incumbent US/Expats left within the first six months of contract performance…

...Problems with the contract, particularly concerning staffing, persisted and in September 2008 the department threatened to terminate it. But in July, State renewed the contract through 2010, with an option to extend it through 2012. The contract is worth $187 million annually…

The report further examines the utter breakdown in State oversight, with toothless warning and notifications that allowed Wackenhut Services, Inc., the parent company of ArmorGroup, to continue its abysmal performance with no real consequences. Over the last two years, this contract has seen possible misrepresentation by Wackenhut executives to Congress through sworn testimony refuted by POGO, security and communications breakdowns, and creating an environment that fuels resentment and volatility that has far reaching effects on our mission and foreign perception in a culturally sensitive part of the world.

Other questions brought to bear by the report is the inherently governmental function of providing security in a combat zone by contractors, which carries the risks of cost-cutting and profit motive, personnel issues, and rules of engagement and accountability by contractors. These types of questions still remain unanswered, although they should have been answered by State years ago through investigation and proper contract management of security contracts in Iraq (e.g. Blackwater).

Although it is expected that State will finally terminate the ArmorGroup contract, the issue remains on how these oversight gaps will be filled in the future. Although State continues to take the issue very seriously in light of the POGO report and will continue to improve its oversight of State security contract overseas, the bigger question is the inherently governmental nature of providing security in a combat zone. As POGO recommends, the language in the 2009 National Defense Authorization Act should be clarified and strengthened to prohibit reliance on private security contractors for inherently governmental functions, and to include protection of the diplomatic mission in a combat zone as being inherently governmental. I do not believe this function is something that should be outsourced, as the most professional and dedicated security force in the world should go back to performing this function; the U.S. Marines.

This also brings into question appropriate disciplinary action against Wackenhut and ArmorGroup, as the nature and severity of their actions warrant disbarment and possible criminal proceedings against those employees who violated the law in the “performance” of their duties against other employees and local nationals. Only when the Government takes performance and oversight seriously, and holds contractors responsible and accountable for their actions, will this type of activity no longer take place. I do believe that the vast majority of contractors act in accordance with ethics rules and uphold high standards of integrity, but am troubled by the small percent that do not and corrupt the government contracting process with little or no accountability. Past performance has to be made a much stronger evaluation factor for future work, and should be the central focus of award guidelines in light of a renewed push for tracking past performance data. Nonetheless, strong contract administration and oversight are ultimately the key to ensure performance on contracts. If it were not for whistleblowers risking is some cases their safety, would we have known about the abuses at Abu Ghraib prison in Iraq or ArmorGroup in Afghanistan?