Trump Administration Targets Tech Firms as It Cuts More Contracts [View all]

Source: Wall Street Journal

The government’s monthslong quest to wring savings from federal contractors is widening beyond consulting firms and entering a new phase focused on tech companies.

The Trump administration is moving its spending review beyond consulting firms, such as Accenture and Deloitte, to now scrutinize contracts at a collection of companies providing sometimes obscure technology services to federal agencies.

The General Services Administration on Wednesday sent a letter to 10 technology providers, including Delland the IT firm CDW, asking executives to justify their work and find areas to cut. The letter is aimed at companies known as value-added resellers, who often piece together different technology products and services for the government. The U.S. spends $82 billion annually on IT products and services, and complex procurement processes have led to “excessive markups and increased costs to the taxpayer,” the letter notes. “This must change.”

The letter, a copy of which was viewed by The Wall Street Journal, was sent by Josh Gruenbaum, commissioner of GSA’s Federal Acquisition Service, who is overseeing the review of federal contractors. Responses by the companies are due June 11.

Read more: https://www.wsj.com/business/trump-federal-contracts-tech-firms-c839fdbb?st=1M9reA