I was overwhelmed by the feedback on last week’s comment. In particular, my closing statement that “we should review current data collection requirements and eliminate those where the costs outweigh the burdens” has engendered several positive comments. It is time for such a review. Our current budgetary and economic challenges demand that we make the procurement system more efficient and effective.
The unintended consequences of growing data collection requirements may not be immediately evident but they do have long term consequences for Government, industry and the taxpayer. The impact of overly burdensome data collection requirements leads to the following consequences:
- Limited competition. The investment in systems, personnel, compliance infrastructure to meet data reporting requirements creates barriers for commercial firms seeking to enter the Federal marketplace.
- Increased costs to the Government. The costs associated with data collection for contractors translate into higher prices paid by the Government not to mention the agency’s internal costs for managing and maintaining reported data.
- Reduced socio-economic contractor participation. The infrastructure costs associated with data collection negatively impact small business concerns.
- Reduced jobs. Increased overhead costs often result in cuts in other aspects of a company’s operations. Increased regulatory data collection burdens will lead to cost cutting—including personnel costs and movement of jobs overseas.
Government has legitimate needs for effective and efficient data collection and reporting. The key is identifying real needs and not creating unnecessary, burdensome reporting. When a real need is identified, it should be implemented in the most efficient, cost-effective manner possible.
In any case, the benefits of data collection must outweigh the burdens and costs imposed on the procurement system. In reviewing the current data collection requirements imposed on the procurement system the following questions should be asked and answered: What is the purpose of the data collection? Is the data being collected relevant to the purpose? Is the data being effectively used? If not, why? How is the data being managed? What are the infrastructure costs for Government? Does the data collection improve Government operations? When is the data collected? Where is it located? Does the Government already have the data before asking the contractor for it? What is the shelf-life of the data? What are the private and public burdens and costs of collecting and maintaining the data? Are contractors reimbursed for data collection and reporting? Has the collection/reporting requirement gone through the Paperwork Reduction Act review process (See 5 CFR Part 1320)?
It is time for a public-private dialogue with the goal of providing more efficient and effective data collection, at a cost that benefits the taxpayer.
If I can digress for a moment, it is interesting to note that when “spend data” is requested from contractors, it is data originated by the customer, the Federal Government. So we have the Federal Government requiring contractors to put in place systems, at a cost, to report back to the Federal Government its own data. I make this point to demonstrate that “data is not a free good.” It would cost the Federal Government a significant amount of resources in order for it to effectively capture its own spend data and not require industry to capture and provide it. I think the point is made. Moreover, the Paperwork Reduction Act is there for a reason, and established data collection rules should be followed before data requests are made.
