DoD Subcontracting “Test” Program Under Fire

A quarter century later, Pentagon’s test program for small businesses still untested

Defense Department, business groups say program should be scrapped

September 29  (

During its approval of the defense budget back in 1989, Congress added a new test program intended to simplify the subcontracting process for large defense contractors. In theory, proponents said, the tweak would lead large prime contractors to pass more work along to small businesses.

A quarter century later, some of the world’s largest defense contractors are still taking advantage of the program — which, oddly enough, remains in “test” mode. Odder still, the test has yet to be evaluated.

Called the Comprehensive Subcontracting Plan Test Program, the initiative allows large defense contractors to establish company-wide or division-wide subcontracting plans that outline how the company or each of its units generally intends to partner on any work awarded by the federal government. Any time one of the participating companies competes for work, it can present the general subcontracting strategy.

Normally, prime contractors are required as part of the bidding process to submit a specific subcontracting plan for each individual project, which details how much of the work they plan to outsource and to what type of companies.

Originally approved for a two-year test, the test program has since been extended by Congress several times, with its latest authorization set to expire at the end of the year. Its current test participants include a dozen of the nation’s largest defense contractors, including Lockheed Martin, Boeing, Northrop Grumman and General Dynamics.

Now 25 years after its inception, the Defense Department’s Web site still refers to the program as a “test,” stating that its purpose is “to determine whether comprehensive subcontracting plans will result in increased subcontracting opportunities for small business while reducing the administrative burden on contractors.”

The idea is that, by alleviating some of the hassle of partnering with small businesses and by allowing those subcontractors to perhaps become part of a larger firm’s overarching, routinely-used subcontracting network (rather than competing for one-off projects), more work — and more contracting dollars — would trickle down to small firms….

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