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providing, of course, we can arrive at a fair and reasonable price. And this goes back to the early 1930's actually.
So as far as computer manufacturers being placed on schedule or our contracting with them to be placed on schedule that always has been open.
With regard to your point about the number of people with whom you would negotiate, that in like manner has been open.
The law which applies equally to all agencies with regard to this point at least, the Federal Property and Administrative Services Act requires competition, it is the sense of the Congress that competition be obtained. The only limited areas in which you can negotiate the procurement of ADP happen to fall in that area but that is competitive negotiation. The only essential difference when we use the word “negotiation” the only essential difference between that and advertised bidding is the fact you don't publicly open the bids, otherwise all the other conditions are met. You solicit the same number of people you would if you were going to open the bids publicly, and I know of no instance, at least except with the exceptions I mentioned earlier, the far out equipment that AEC and to extent NASA and other agencies buy, intelligence agencies buy, the occasional occurrences where you need to add on a kind of modular device, and with those exceptions, I know of no others, and I believe that there has been competition in every
other case. Representative Brown. My time is up. We will come back to the point.
Chairman PROXMIRE. Congresswoman Griffiths ?
AGENCY STEPS IN GETTING COMPUTERS
Representative GRIFFITHS. Thank you. I would like to ask you, Mr. Abersfeller, for any agency asking for a computer do they have to prove need or savings or what do they have to prove besides that the money is available!
Mr. ABERSFELLER. In the first step I believe they have, would be to go to the Bureau of the Budget. BOB since we appear before them, too, do a very credible job in analyzing the requirements that are presented to them.
With regard to the procedure beyond that point they are required by the Bureau of the Budget regulation to develop feasibility studies which must prove that the particular application or applications they choose to or plan to use must be verified as being the economic thing to do.
This is covered in Bureau of the Budget Circular A-54.
Beyond that point they make no justification to us, Mrs. Griffiths, at all. We do not get involved in that. The Brooks bill places with the agency the responsibility for determining its requirements. The only place we interfere, if that is a proper term, and I suspect some of the Government agencies feel we do, is when we believe that the procurement is restrictive. We then insist that it be rewritten so it is not restrictive. So that all the computer manufacturers, and peripheral producers, if that is appropriate, can bid on the particular procurement that is involved, and that is the extent essentially of our involvement in the justification process. We do the buying or control the buying through delegations.
PROCUREMENT OF SYSTEMS AND COMPONENTS
Representative GRIFFITHS. To what extent do you buy parts of a computer from various peripheral sellers and put it together? Do you buy only replacement parts or do you deal only with the original?
Mr. ABERSFELLER. We have contracts now with 71 peripheral and accessorial producers, again under Federal supply schedule, and in most instances agencies would order them direct.
Representative GRIFFITHS. You are not responding. I am asking, when you buy a complete new computer for an agency, do you buy the whole computer from one seller, or do you buy the parts of the computer from various sellers ?
Mr. ABERSFELLER. At the moment the end results are that they are being bought from one seller.
Representative GRIFFITHS. Why? Mr. ABERSFELLER. Well, there may be a couple of reasons, Mrs. Griffiths. One, we have had no great indication other than Mr. Caveney's testimony before the committee, that peripheral people are interested in bidding.
An example of that, the last time we appeared before this committee Mr. Caveney said there were 50 people who wanted to bid and Senator Proxmire asked me would I write to them, and I did, and out of all that we got offers from nine, and in fiscal year 1970 we have entered into contracts with seven of them. That may be one problem.
It also may be the problem, Mr. Caveney spoke about, that maybe the invitations are so structured as to discourage it and this is an area we are examining now and we do want, and this is actually one of the reasons we called meetings we have called, to try to get that input to find out if we could by restructuring the invitations provide for more participations than now being provided for.
Representative GRIFFITHS. If I were buying, and I looked at a computer where a peripheral part had been supplied as a replacement part, I wouldn't have to bother with asking them to bid. I would ask them their price. It seems to me it is that simple.
Mr. ABERSFELLER. Well, Mrs. Griffiths, let me just say this so far as I know, and I think I am reasonably up to date on this, the peripheral manufacturers only have plug-to-plug capability with one manufacturer, and that is IBM. So if you were going to buy Univac or RCA or CDC you in fact have no plug-to-plug capability for the peripherals. Now that makes a difference.
If, on the other hand, you knew in advance, and we really don't, that IBM would end up successful in the main frame, then you could perhaps do it. This is why we believe at the moment at least, and we are trying to make the inroad on replacements, where there are existing IBM equipments so we can go to plug to plug on that.
Representative GRIFFITHS. I see.
DETERMINATION OF NEED AND COST JUSTIFICATION IN ARMY
Colonel Warren, who, in the Army, decides whether or not a computer is not only needed but is costwise justifiable?
Colonel WARREN. The senior ADP policy official in the Army passes on the requirements for computers, and the senior ADP policy
official is now located in the Assistant Secretary of the Army for financial management's office.
Representative GRIFFITHS. Who checks up afterwards to find out if it really worked out that way?
Colonel WARREN. As I mentioned earlier, we, my office, as well as the Army ADP office go out and make onsite visits and examine the systems to see if they are meeting their objectives and if, in fact, they are operating as they planned, and we have made some 20 visits this year, as I mentioned.
Representative GRIFFITHS. I would like to see from somebody something that shows some real savings because computers have been purchased. Were people displaced, was there information available that had never been made available before?
STORAGE OF RECORDS
Mr. Abersfeller, you responded to a question of the Chairman that you didn't need any space to store the records. What happens to the records? Do they use the information that day and forget it, or what exactly happens to it?
Mr. ABERSTELLER. Generally, the printed information is used for a very short period of time, and this is to actually conserve space. Most of the information that is maintained is either maintained on tape or some other microfilming kind of device which conserves the use of space.
Representative GRIFFITHS. I would like to ask you, Mr. Caveney, what happened to the man who made the suggestion that, in your judgment, would have saved a billion dollars?
Mr. CAVENEY. What happened to him?
USE OF EMPLOYEE SUGGESTION SYSTEM
Representative GRIFFITHS. As you were talking, I wondered to myself since this committee was set up really for economy in Government, supposing employees were asked to send these suggestions in in duplicate, and one suggestion would come to this committee, since we supply everybody else with money. I don't suppose it would be impossible that we set up a staff of our own and go over the suggestions. And we could then see they were implemented and rewarded.
Mr. CAVENEY. Well, I think this should be done because, as I stated in my "One Billion Dollars Refused by Government” article which was placed in the Congressional Record evolved around this one sug. gestion. I maintain, like so many people, these ungodly wastes wouldn't occur, at least not as many. They will occur because Congress or the President does not have a review body of technical people to act before an award.
The executive branch does it in little bitty closets within its structure, and you can't do anything about waste of tax dollars until it pops up and is after the fact and then they want more money because they had an overrun.
Representative GRIFFITHS. You see, this committee had some prob. lems with this, where the man who revealed what was wrong was fired for revealing it to this committee. So if we could just find out what the suggestions of the employees were, and if a suggestion were really a worthwhile suggestion, and saved money, we might make it so worthwhile for the employee that he could afford to risk his job and make the suggestion.
Mr. CAVENEY. I think it should be set up by this committee. It is obvious it can't be accomplished by the executive side who currently is responsible for the Federal suggestion program, and if they are not going to carry out this responsibility on an ethical basis, then it should be transferred to the legislative side to give the little gay in Government a right to be heard. That is why I like the ombudsman policy of the President because I have had some contact with Mr. C. Mollenhoff which were strictly personal and it is great to know you can go there, pound on the desk, and at least something goes to maybe the Great White Father, but I think you ought to pull the suggestion program into the Congress as evidence clearly indicates it is not wanted on the executive side.
Representative GRIFFITHS. I think the suggestion program should be, too, and, you know, I like this idea that some of the people coming new into an agency, and having looked it over can figure out some new things to do that would be money saving. I think there is a great deal of merit to the suggestion, and I think that they should be encouraged to do just exactly that.
Now, I suppose that if the suggestion is taken higher than the boss, it will not necessarily be desirable, but I think that the ones that are good ought to be considered.
Mr. CAVENEY. The Federal employees who attempt to utilize the suggestion program are highly skilled technical people but the problem is the guy on top, he hasn't got the mental capability to understand what he is reading, and then, of course, his out is, easy out that is, disapprove it.
Representative GRIFFITHS. I agree. Mr. CAVENEY. Then this example of Peter's Principle frustrates the whole system because he represents Peter's Principle, you know, “I am incompetent, I will make it.
Representative GRIFFITHS. Thank you very much.
Representative Brown. I just wanted to ask on that point do you think this committee is competent to review those technical
Representative GRIFFITHS. I wasn't going to have us do it, Mr. Brown. I was going to set up a really competent group of people reporting to us, let them look it over.
Mr. CAVENEY. I think you could draw upon different associations that have the technical competency to assist. After all we are taxpayers and we like to lower our tax base to the Federal Government.
NBS HAS COMPETENT BUT INSUFFICIENT STAFF
Chairman PROXMIRE. How about the Bureau of Standards people, Mr. Caveney, are they competent?
Mr. CAVENEY. They are competent but they just don't have enough peonle.
Chairman PROXMIRE. All right. That is fine, that is what I wanted to know. If they don't have enough people you would concur then
in the testimony we had this morning that they simply don't have the bodies and if they did have the people on the basis of the competence they have now they could do the job, at least in this interface area that we were talking about?
Mr. CAVENEY. Yes, because one thing we like about the Bureau of Standards it is a disinterested party. You have a more impartial group of people, and they do have the competency and they do have the management ability and what they need is strength, strength in people and dollars.
Chairman ProXMIRE. Colonel Warren, do you agree Standards is not staffed to do a full interface job?
Colonel WARREN. Bureau of Standards? Chairman PROXMIRE. Yes, sir. Colonel WARREN. Well, they haven't accomplished the interface job yet, but I wouldn't want to speculate on the reasons. I am not really familiar with their staffing.
Chairman PROXMIRE. Were you here this morning?
Chairman PROXMIRE. I see. We had strong testimony from both the Office of Management and Budget and from the Bureau of Standards ånd from GAO. There was unanimity of agreement they needed more people. That was their problem.
Do you agree, Mr. Abersfeller!
Colonel WARREN. I would certainly agree we could use a great deal more activity from the Bureau of Standards in the standards area.
Chairman ProXMIRE. In other words, you don't disagree, you simply say that on the basis of the information you have you can't make a judgment ?
Colonel WARREN. Yes, sir.
Mr. ABERSFELLER. I would have to join Colonel Warren, I know the people and know them well, but I am not certain whether there are enough or not enough to do the job. Again the standards is a difficult area and does take time but I would like to point out, Mr. Chairman, standards are not the only answer.
Chairman PROXMIRE. What is that, sir?
Mr. ABERSFELLER. Standards are not the only answer for capability. It is an answer.
Chairman PROXMIRE. At any rate would you agree with Colonel Warren that they are not doing the job?
Mr. ABERSFELLER. Yes.
EXTENT OF COMPETITION IN BUYING ADPE
Chairman PROXMIRE. How competitive is the procurement of ADP. Your answer to Congressman Brown seemed to indicate that you felt there was a considerable degree of competition. I wonder. In the first place pheripheral manufacturers have been excluded except to a small extent, purchases are then restricted even further, according to your testimony, to a handful of suppliers, who might qualify, and then specifications are sometimes, apparently, custom made to correspond with the suppliers existing ADPE and finally when there is no competition and the approach is through negotiation the Government fails to insist on compliance with the Truth in Negotiation Act and grants a waiver.