The need to increase competition at the subcontract level.

Abstract

This study was undertaken to investigate the need to increase competition at the subcontract level in Government acquisition. Current Government acquisition policies include the preference for competitive subcontracting*, It was recognized that approximately 50% of all Government acauisition dollars go to subcontractors and that effective competition at that level is necessary to ensure that the Government is receiving quality items at the best prices. In investigating the nature of competitive subcontracting, interviews were conducted with Government, prime contractor, and subcontractor personnel. Areas covered in these interviews included the amount of competitive subcontracting, competitive practices and policies of each participant, and problems encountered in attempting to achieve competition. The results of this study include: the current extent of competitive subcontracting is unknown; there are many pressures working against competition; although the Government has procedures and policies regarding competition they do not always work; and, the need to increase competition cannot be determined without further research. It is recommended that a reporting system be developed to monitor the amount of competitive subcontracting and that a mandatory subcontracting clause be developed, if more competition is desirable.