Overseas Civilian Contractors

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Federal contractors get 10 percent raise

“Excessive reimbursements are wrong and must stop,” Mack said. “We call on Congress to follow the lead of those members who have already recognized the importance of lowering the executive compensation cap so that taxpayers are no longer liable for these wasteful and unnecessary payments.”

Washington Post  Joe Davidson  The Federal Diary May 7, 2012

Uncle Sam isn’t as flush as he used to be, but he still has enough money to pay individual private contractors as much as $763,029.

That’s the federal cap on reimbursement to executives of private firms doing government work. The cap was raised in April, from $693,951, by the Office of Federal Procurement Policy

It’s worth pointing out that this 10 percent raise comes as federal employees are in the midst of a two-year freeze on basic pay rates.

But Obama administration officials had no choice in raising the cap. The compensation formula was set by law.

“In accordance with an outdated statute, the federal government was forced to raise the cap on agency reimbursements to contractors for the pay of senior executives who contract with the government,” said Moira Mack, an Office of Management and Budget spokeswoman. “With this latest congressionally mandated increase, taxpayers will be on the hook for contractor reimbursements far in excess of what is reasonable.”

A notice to federal agency heads, from Lesley A. Field, acting administrator of the Office of Federal Procurement Policy, said “this rate of growth in the cap . . . has far outpaced the rate of inflation, the rate of growth of private-sector salaries generally, and the rate of growth of Federal salaries — forcing our taxpayers to reimburse contractors for levels of executive compensation that cannot be justified for Federal contract work

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May 7, 2012 Posted by | Civilian Contractors, Contractor Oversight, Follow the Money, Government Contractor | , , | Leave a comment