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FPCD-81-77 1 (1981-09-30)

handle is hein.gao/gaobabcmu0001 and id is 1 raw text is: 



                  UNITED STATES GENERAL ACCOUNTING OFFICE
                          WASHINGTON, D.C. 20548


FEDERAL PERSONNEL AND
COMPENSATION DIVISION


     B-201794                                       SEPTEMBER 30,1981


     The Honorable Caspar W. Weinberger

     The Secretary of Defense                        116570

     Dear Mr. Secretary:

          Subject: Expanding the Efficiency Review Program for
                    Commercial Activities Can Save Millions
                    (FPCD-81-77)

          We havei completed a limited survey of the Department of
     Defense's (DOD's) program to increase the efficiency of some
     in-house commercial or industrial-type activities ,(referred
     to hereafter as commercial activities). The efficiency re-
     view program saves money each year by developing and applying
     performance standards that eliminate unnecessary and ineffi-
     cient work practices. 'However, about 80 percent of DOD's
     15,000 commercial activities are exempt from the program for
     various reasons. We believe DOD could save an additional
     $350 million by expanding the scope of its program to in-
     clude these activities, and we are recommending actions to
     deal with this matter.

     OBJECTIVES, SCOPE, AND METHODOLOGY

          Our objective was to determine if and how DOD could ex-
     pand its efficiency review program to include those commercial
     activities now exempt. Because a large number of activities
     are exempt, the potential for increased efficiency and large
     dollar savings is significant.

          Office of Management and Budget (OMB) Circular A-76 estab-
     lishes executive branch policies and procedures to be used to
     determine whether needed commercial or industrial goods and
     services should be obtained by contract with private sources
     or provided in-house using Government facilities and personnel.

          During July 1981, we interviewed officials responsible for
     the A-76 program in the Office of Federal Procurement Policy

                                                            (966057)


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