Govt. on track to save $40B in contract costs

AP News
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Posted: Dec 21, 2009 10:36 AM

President Barack Obama is touting the federal government's efforts to become more efficient Monday, highlighting a new report that shows billions of dollars in savings on contract costs.

The report released by the Office of Management and Budget shows that agencies have identified more than $19 billion in contract savings for fiscal year 2010. The administration says that puts the government on track to meet its goal of saving $40 billion annually by fiscal year 2011.

The administration has said the savings will come from terminating unnecessary contracts, ending an over-reliance on contractors, and reducing the use of high-risk contracts. Federal spending on contracts has doubled since 2002, reaching $540 billion last year.

In keeping with the efficiency theme, Obama met privately Monday with Nancy Fichtner, a Veterans Affairs Department employee from Colorado, who is the first winner of the government's SAVE award. SAVE stands for "Securing Americans Value and Efficiency."

Fichtner won the award for her suggestion that veterans leaving VA hospitals be able to take the medicine they've been using home with them instead of it being thrown away when they're discharged.