GAO: DoD Must Share Best Practices on Using Contract Types Across Military Branches

The Government Accountability Office (GAO) is recommending the Department of Defense (DoD) to share the findings of its reviews on the impact of contract types such as cost-type awards to weapons acquisition programs.

GAO said in a report released Tuesday that cost-type contracts, which entails payments based on costs incurred by the contractor, require additional reports on schedule and cost performance. Cost-type contracts are among the types used by the DoD to procure new weapon systems such as satellites, ships and aircraft, GAO said.

The watchdog found that there is no “clear relationship” between the outcomes of 21 acquisition programs and the contract types used. However, GAO said that better cost and schedule management resulted from programs that implemented best practices such as completing preliminary design reviews ahead of system development.

According to GAO, the DoD’s modification of peer-review procedures for its major contract awards “reduced a means for sharing best practices” across the service branches.

“Historically, [the DoD] has struggled to manage its major acquisition programs. The result has been billions in cost growth and schedule delays in providing systems to the warfighter,” the report states.

The Pentagon used cost-type contracts for less than one-fifth of obligations from fiscal years 2011 through 2019, according to GAO.

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