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Federal Government Awards Small-business Contracts to Large Firms

The federal government has awarded more than $8 billion worth of small-business contracts to multimillion-dollar moneymakers such as Lockheed Martin, General Electric and AT&T, among many others, according to the American Small Business League’s analysis of federal contracts awarded last year.

The analysis revealed that of the 100 business awarded the federal contracts, 61 were large business or owned by large companies, receiving 60 percent of contracts awarded. By law, federal agencies are required to give 23 percent of contract awards to small businesses. A lack of regulation and incomplete reporting by the government on how much it spends on contracted goods and services has led to small-business contract figures becoming inflated.

Federal Times reported the Senate Small Business Committee introduced legislation aimed at improving the certifying and monitoring of small business. The bill also penalizes businesses that provide false information to win contract awards.

Senior adviser in the SBA’s Office of Government Contracting and Business Development Michele Chang said contracting office errors or companies failing to report acquisitions lead to large companies winning small-business contracts.

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