Ten of the largest US consultants have been told that they have until Friday to justify billions of dollars of ongoing projects for the federal government, and officials told the Financial Times they planned to expand the number of targeted firms in the coming weeks.
An FT analysis of federal data shows that more than 30 contracts held by the 10 consultants have been completely or partially cancelled. The largest is an umbrella contract covering IT services for the Internal Revenue Service, led by Deloitte, valued at up to $1.9bn over seven years.
“Only services with a demonstrable return on investment for the taxpayer will remain,” said Josh Gruenbaum, commissioner of the Federal Acquisition Service, which helps co-ordinate government procurement.
The contracts are held by a wide range of federal entities, including Immigration and Customs Enforcement, Department of Defense, Social Security Administration and the US Patent and Trademark Office. In five cases, the cancellation is explicitly linked to the White House’s directives to axe diversity initiatives.
A contract between Booz Allen Hamilton and the Federal Acquisition Service was being partially terminated “to comply with the diversity, equity and inclusion, accessibility (DEI) executive orders”, according to one filing.
“In an ideal world, we would see a reduction in consulting gigs and the increased hiring of accountable public servants to replace them,” said Benjamin Brunjes, an associate professor at the University of Washington. “That will not happen, so the result will be understaffing, loss of institutional knowledge and failure to provide many essential public services.”
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