The Obama administration has released its most recent report on the percentage of federal contracts that were awarded to small businesses.

 

As happens every year, the federal government reported having narrowly missed the congressionally mandated goal of awarding 23% of federal contracts to small businesses, claiming to have awarded 21.65% of federal contracting dollars to small businesses in fiscal year (FY) 2011.

 

However, watchdog organizations and small business advocates such as the American Small Business League (ASBL) maintain that the true percentage of federal contracts awarded to legitimate small businesses is a tiny fraction of what the government claims.

 

Since 2003, more than a dozen federal investigations have found billions of dollars in federal small business contracts flowing into the hands of corporate giants. In the beginning of FY 2012, the SBA Office of Inspector General named the diversion of federal small business contracts to large companies as the SBA’s top management challenge for the seventh consecutive year. The latest federal contracting data shows that 72 of the top 100 federal “small” business contractors in FY 2011 were actually large companies, and also includes companies such as Lockheed Martin, Boeing, General Electric, Chevron and Russian arms trading company Rosoboronexport in small business data.

 

Last month, the ASBL led a coalition of small business advocates, trade organizations, businesses and non-profit organizations in sending formal letters to the Obama administration, requesting that the Small Business Procurement Scorecard accurately represent the percentage of federal contracts awarded to legitimate small businesses. Despite our concerns, this most recent scorecard continues to dramatically overstate the federal government’s compliance with the 23% procurement goal.