President Donald Trump signed an executive order Thursday that seeks to address longstanding problems in the federal government’s contracting system, citing “unpredictable costs,” “bloated overhead,” and weak performance incentives that have driven up spending and reduced accountability.
In a new policy directive, officials said the current model has too often failed to protect taxpayer dollars or ensure contractors deliver on time.
“Federal procurement has for too long tolerated unpredictable costs, bloated overhead, and weak performance incentives that frequently allow overspending,” the executive order stated. “Many government contracts operate on a cost-reimbursement model that guarantees reimbursement for incurred costs plus a profit margin, which provides little incentive to control overspending.”…