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Wednesday, April 16, 2008

Today: House and Senate Hearings Ignore Diversion of Federal Small Business Contracts to Large Firms

Post by: Kevin Baron, ASBL Team Member

Today, the House Committee on Small Business, Subcommittee on Contracting and Technology will hold a hearing on “Ensuring Small Businesses Have Fair Access to Federal Contracts” While the witness list consists of a well-rounded group that includes Chris Bates from the National Office Products Association (NOPA), Margaret Dorfman from the U.S. Women’s Chamber of Commerce, Faye Ott from the SBA as well as others, there is not a single witness that will be discussing one of the most pressing issues facing small businesses in the federal contracting arena today- the diversion of billions of dollars a year in federal small business contracts to large and Fortune 500 firms.

Report 5-15, released by the SBA Inspector General in March of 2005 stated, “One of the biggest challenges facing the Small Business Administration and the entire federal government today is that large businesses are receiving small business procurement awards and agencies are receiving credit for these awards.”

Today’s hearing in the House should provide for the examination of several important issues that face small businesses trying to work with the federal government, but unfortunately the hearing will ignore the 800-pound gorilla in the room. Last year alone, roughly $60 billion in federal small business contracts went to some of the largest firms in the United States and Europe, yet the Subcommittee on Contracting and Technology will ignore the single largest problem facing small businesses, and focus on issues that stem from this problem- this is like trying to heal a bullet wound with a band-aid. This makes me wonder why the Committee will not address this issue head-on, what are they afraid of?

In related news, the Senate Committee on Small Business and Entrepreneurship will hold a hearing today to examine how the recent credit crunch is effecting small businesses. At this hearing, SBA Administrator Steven Preston will testify as well as a second panel representing small business interests. It will be interesting to see if the issue of federal small business contracts to large firms will be discussed.

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