|
Thursday, July 10, 2008
Questionable KBR Contract Oversight Practices Detailed in Senate DPC Hearing
The Democratic Policy Committee held a hearing in which Charles M. Smith discussed the circumstances under which he was removed from his position as head of the Field Support Contracting Division of the Army Field Support Command. As the official in charge of overseeing a multi billion contract with KBR, he refused to sign off on some $1 billion in unsubstantiated charges by the contracting firm, and as a result, the Army reassigned him to a different post.
Calling the oversight of the KBR contract "irregular and highly out of the ordinary," Smith also told the committee about a number of other practices that substantially weakened the ability of the Army to ensure taxpayers were not getting fleeced by KBR. These practices include:
- The unusual waiving the standard practice of witholding 15 percent of unsubstantiated charges until those charges could be verified
- The hiring of a contractor -- RCI (now SERCO) to oversee the KBR contract
- The conversion of contract type such that some of KBR's contracts would not be audited after they had been completed
- Consistent classification of KBR contract performance as "exceptional," despite problems with the fulfillment of some contracts
And although Smith should be commended for putting taxpayers first at the expense of his own career, we cannot assume that all contracting overseers are of similar moral courage and dedication. As Smith warned, the message from the Army is clear: Effective oversight could be hazardous to contract officers' careers.
The video below is an excerpt from the hearing in which Smith tells Committee Chair Byron Dorgan (D-ND) how poor contract oversight impacts not only taxpayers, but also the troops in the field.
Video: entire hearing
Written statement: Charles M. Smith
Posted by Craig Jennings
|