WASHINGTON – In response to a new report, Homeland Security and Governmental Affairs Committee Chairman Joe Lieberman, ID-CT., said Wednesday conflicts of interest in federal contracting are unacceptable and must be rooted out. Lieberman called on agencies across the federal government to step up efforts to guard against conflicts that could cost taxpayers millions of dollars a year.

His comments came on the heels of a new Government Accountability Office report that found that 42 percent of the contract specialists at the Army’s Contracting Center for Excellence are contractors themselves. The Contracting Center for Excellence was responsible for awarding $1.8 billion in contracts in Fiscal Year 2007. The report – titled “Defense Contracting: Army Case Study Delineates Concerns with Use of Contractors as Contract Specialists” – found that in some cases, contractors had been assigned to assist with procurements that their company planned to bid on.

The Department of Defense has no requirement that contractors be free of conflicts of interest but instead relies on individual employees to identify potential conflicts.

The problem is not limited to the Department of Defense, Lieberman said.

“Every day, contractors work side by side with federal employees, and yet the government might not even know when the self interests of contractors are pitted against the interests of the American taxpayer,” said Lieberman. “Given the government’s increased reliance on outside contractors, we need an immediate overhaul of federal ethics policies to ensure that conflicts of interests don’t impair the impartiality of contractors or their employees.

“The danger of conflicts of interest is particularly acute when the government hires contractors to assist with the federal contracting process itself. We must be assured that contract dollars are awarded so that taxpayers get the best value for their money and not to increase the fortunes of a contractor or its employees.”

Earlier this month, GAO released another report – “Defense Contracting: Additional Personal Conflict of Interest Safeguards Needed for Certain DOD Contractor Employees” – which found that in 15 of 21 offices reviewed by GAO, contractor employees outnumbered federal employees and comprised as much as 88 percent of the workforce. The report pointed to inadequacies in government rules that increase the risk of contractor employee conflicts of interest influencing government decisions.