Trump administration tells big consulting firms to cut the 'gobbledygook' and justify their contracts

Yahoo

26-03-2025

The General Services Administration has asked consulting firms to justify their government contracts.
10 companies have been asked to submit a spending breakdown that "a 15-year-old" could understand.
The GSA told BI it has already cut $4.5 billion worth of consulting contracts under Trump.
The Trump administration has asked 10 of the federal government's highest-paid consulting firms to justify their spending on contracts using language stripped of "gobbledygook" that "a 15-year-old should be able to understand."
In a letter sent to executives at the 10 firms in recent days, the General Services Administration asked the consultancies to provide a detailed breakdown of the spending on contracts from fiscal years 2019 to 2024.
The letter, which Business Insider has seen, says they should then identify waste and spending reduction opportunities.
"We believe it is important to undertake this review in partnership with industry," Josh Gruenbaum, the GSA's Federal Acquisition Service Commissioner, wrote in the letter.
"To that end, we are now seeking your firm's detailed input on spending broken out by agency, project and category of service, as well as the pricing of such services."
Firms were warned not to use any "consultative jargon or gobbledygook" in their responses.
"A 15-year-old should be able to understand what service you provide and why it is important," Gruenbaum said.
The 10 consulting firms on the list are Deloitte, Accenture Federal Services, Booz Allen Hamilton, General Dynamics, Leidos, Guidehouse, HII Mission Technologies, Science Applications International, CGI Federal, and IBM. They have until March 31 to respond.
The consultancies have three guidelines to follow: identify waste and savings opportunities; break down spending by agency, contract, and project; and detail and make recommendations on pricing "that would lead to savings for the US taxpayer."
"Scorecards that do not identify waste and spending reductions will not be deemed credible and your firm will be seen as unaligned with the Administration's cost cutting goals," the letter said.
The letter was accompanied by a slide deck template for the firms to use in their responses, which BI has seen. Details that the GSA wants to see include the rationale for any large increases in spend and a list of price reduction opportunities that the consultancies are "prepared to action immediately."
Gruenbaum told BI that the GSA's goal was to serve as "unrelenting fiduciaries to the American people" and deliver "the maximum return on investment for their taxpayer dollars."
"It's what these firms would do when analyzing their own budgets and we welcome them working with us to decrease our excessive government spending while continuing to provide the essential services the government needs," Gruenbaum said.
The Trump administration has already started evaluating its spending on consultants as part of its DOGE-driven agenda to cut costs and boost efficiency.
In late February, the GSA asked federal agencies to provide a similar review of contracts with the same 10 consultancies.
A source at the GSA told BI that it was always the plan to request contract reviews from both agencies and consulting firms. In the letter, the GSA said it would compare the two responses.
Under the Trump administration, the GSA has canceled more than 1,700 contracts, resulting in $4.5 billion in savings, according to internal data the GSA provided to BI.
The GSA source added that the organization recognizes many of the services the consulting firms provide — particularly those relating to national security or involving technical skills — are critical to government operations.
They said that long-standing IT contracts, which DOGE has frequently targeted on social media, were more likely to be seen as an opportunity for the GSA to find value and savings.
Last Thursday, Trump signed an executive order consolidating all IT procurement activities under the GSA. Procurement of other common goods and services will also be centralized into the agency to return it "to its original purpose" as the government's central purchasing arm, a White House directive said.
The 10 firms collectively earn tens of billions of dollars annually from their contracts with the federal government, leaving some federal consulting departments shaken by the pressure to justify their value.
Workers at Deloitte and Accenture's federal advisory divisions previously told BI that there had been a flood of colleagues looking for projects to work on and that they were worried about layoffs.
During Accenture's earnings call last week, CEO Julie Sweet said that DOGE scrutiny had already hit the firm's sales and revenues and slowed procurement of new federal contracts.
"We anticipate ongoing uncertainty as the government's priorities evolve and these assessments unfold," Sweet said.
Some firms on the list have publicly embraced DOGE's agenda.
In an earnings call in February, Thomas Bell, CEO of Leidos Holdings, said that in light of the new administration's priorities, Leidos had developed "fast-paced initiatives in the spirit of DOGE."
"We strongly support the goal of creating a dramatically more efficient and effective federal government that costs taxpayers less money," a Leidos spokesperson told BI.
The nine other firms who received the GSA's letter did not respond to requests for comment from BI.
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