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Friday, June 09, 2006

Input critiques financial management line of business

"Vendors are likely to be crippled in their ability to compete for work under the Financial Management Line of Business until the Office of Management and Budget clarifies rules for Circular A-76 competitions, according to a June 7 report from Input.

Guidance that OMB issued in late May includes a competitive framework marked by standard A-76 contracting rules, which govern the process of opening agency jobs to private-sector competition. According to Input, vendors expected the guidance to offer more formal direction and procedural explanation than it does.

The heart of the issue is that under OMB policy, agencies that need to upgrade a core financial management system must either migrate to a shared service provider (SSP), become an SSP or contract with a vendor. However, according to Input, many agencies that would be competing to become SSPs face restraints from budget regulations that leave them unable to develop effective long-term proposals that cross budget cycles.

Agencies are also able to plan their migration to new systems during a 10-year period, limiting the number of customers that an SSP may expect to gain at any given time, according to the report.

The conflicting instruction brings effective competition to a standstill and calls for more clarity, according to the firm. "

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