Contract protests up; contract awards down. What to do?

  |  August 23, 2017

Michael Fischetti, executive director of the National Contract Management Association (NCMA).

Recent data indicates protests have increased by about 17 percent since 2012, exceeded only by the decrease in Government contract spending over that same time. The resulting increase in pre-award costs derived from protests for all parties requires a step back to analyze what is driving this trend.

Most involved in Government contracting today understand the recent trends of a declining market. Topping out at almost $600 billion a few years ago, the current federal budget has been squeezed by the Budget Control Act of 2011, sequestration spending caps, and drawdown of U.S. forces worldwide. Contractors are now competing for ever fewer dollars. This has resulted in many contractors leaving the federal market, either through mergers, simply going out of business, or diversifying.

From the contractor perspective, the rationale for protesting when losing a competition offers several potential benefits. Given the lower rate of incumbent wins, the need to stay on the “good side” of a Government customer doesn’t appear as important as it used to be. The most important reason for protesting may be simply to hang on to business while the protest’s merits are addressed, which often takes months.