USAID's $35.8M contract with Deloitte Consulting LLP for Jordan's fiscal reform shows mixed value and limited competition

Contract Overview

Contract Amount: $35,868,471 ($35.9M)

Contractor: Deloitte Consulting LLP

Awarding Agency: Agency for International Development

Start Date: 2016-04-04

End Date: 2020-09-29

Contract Duration: 1,639 days

Daily Burn Rate: $21.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: IGF::CL::IGF - FISCAL REFORM AND PUBLIC FINANCIAL MANAGEMENT ACTIVITY FOR JORDAN'S MINISTRY OF FINANCE

Plain-Language Summary

Agency for International Development obligated $35.9 million to DELOITTE CONSULTING LLP for work described as: IGF::CL::IGF - FISCAL REFORM AND PUBLIC FINANCIAL MANAGEMENT ACTIVITY FOR JORDAN'S MINISTRY OF FINANCE Key points: 1. Contract value appears reasonable given the duration and scope of technical assistance. 2. Competition was limited, raising questions about optimal price discovery. 3. Performance risks are moderate, with potential for scope creep and dependency on contractor expertise. 4. The contract supports a critical development objective for Jordan's public financial management. 5. Deloitte's extensive experience in public sector consulting positions them well for this work. 6. The contract's time-and-materials pricing structure warrants careful monitoring to control costs.

Value Assessment

Rating: fair

The contract's total value of $35.8 million over approximately four years suggests a significant investment in Jordan's fiscal reform. Benchmarking against similar international development contracts for public financial management assistance indicates that this level of funding is within a typical range for complex, multi-year engagements. However, the time-and-materials (T&M) pricing structure, while offering flexibility, can lead to cost overruns if not rigorously managed. Without specific performance metrics and detailed cost breakdowns, a precise value-for-money assessment is challenging, but the overall investment seems aligned with the ambitious goals of enhancing Jordan's financial systems.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of six bidders suggests a reasonably competitive environment for this type of specialized technical assistance. However, the ultimate number of proposals evaluated and the specific evaluation criteria would provide a clearer picture of the true level of competition. A competitive process is generally expected to drive better pricing and innovation, but the specific outcomes in terms of cost savings or superior technical solutions are not detailed here.

Taxpayer Impact: A full and open competition process is beneficial for taxpayers as it increases the likelihood of securing the best value by encouraging multiple firms to offer competitive bids, potentially leading to lower overall costs and higher quality services.

Public Impact

The primary beneficiaries are the government of Jordan, through improved public financial management systems and capacity building. Services delivered include technical assistance, training, and advisory support to strengthen Jordan's Ministry of Finance. The geographic impact is focused on Jordan, aiming to enhance national economic stability and governance. Workforce implications include capacity building for Jordanian public servants and potential engagement of local consultants.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to the time-and-materials pricing structure.
Risk of dependency on contractor expertise, potentially hindering long-term local capacity development.
Scope creep could lead to increased costs and deviation from original objectives.
Challenges in measuring and demonstrating the long-term impact of fiscal reforms.

Positive Signals

Awarded through full and open competition, suggesting a robust selection process.
Deloitte Consulting LLP has significant experience in international development and public sector reform.
The contract addresses a critical need for fiscal reform in Jordan, aligning with development goals.
The duration allows for sustained engagement and potential for meaningful impact.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically focusing on management and financial consulting for public sector entities. The market for such services is global, with major consulting firms competing for large government contracts. Comparable spending benchmarks would involve looking at other USAID or similar international development agency contracts aimed at public financial management reform in developing countries. The size of this contract ($35.8M) is substantial, reflecting the complexity and long-term nature of institutional reform.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions or subcontracting goals for this contract. As a large contract awarded to a major consulting firm, the primary focus is likely on specialized expertise rather than small business participation. Further investigation would be needed to determine if any subcontracting opportunities were mandated or voluntarily pursued by the prime contractor to engage small businesses in supporting roles.

Oversight & Accountability

Oversight for this contract would typically be managed by the U.S. Agency for International Development (USAID) contracting officer and program officers. Accountability measures would be embedded in the contract's performance work statement, requiring regular reporting and adherence to milestones. Transparency is facilitated through contract award databases and potentially public reports on project progress, though detailed financial breakdowns might be limited. The Inspector General's office for USAID would have jurisdiction for audits and investigations if any concerns regarding fraud, waste, or abuse arise.

Related Government Programs

USAID Economic Growth Programs
Public Financial Management Reform Initiatives
International Development Assistance
Government Consulting Services

Risk Flags

Potential for cost overruns due to T&M pricing.
Risk of insufficient local capacity building.
Challenges in measuring long-term impact of reforms.

Frequently Asked Questions

What is this federal contract paying for?

Agency for International Development awarded $35.9 million to DELOITTE CONSULTING LLP. IGF::CL::IGF - FISCAL REFORM AND PUBLIC FINANCIAL MANAGEMENT ACTIVITY FOR JORDAN'S MINISTRY OF FINANCE

Who is the contractor on this award?

The obligated recipient is DELOITTE CONSULTING LLP.

Which agency awarded this contract?

Awarding agency: Agency for International Development (Agency for International Development).

What is the total obligated amount?

The obligated amount is $35.9 million.

What is the period of performance?

Start: 2016-04-04. End: 2020-09-29.

What is Deloitte Consulting LLP's track record with USAID on similar fiscal reform projects?

Deloitte Consulting LLP has a substantial track record working with USAID and other international development agencies on public sector reform and financial management projects globally. Their experience often includes providing technical assistance, capacity building, and strategic advice to government ministries in areas such as budgeting, tax administration, and public debt management. While specific project outcomes and performance data for past USAID engagements are not detailed here, Deloitte's consistent presence in this market suggests a recognized capability. A deeper analysis would involve reviewing past performance evaluations and contract histories to assess their success rates, client satisfaction, and ability to deliver on complex development objectives within budget and schedule constraints.

How does the $35.8 million contract value compare to similar public financial management reform contracts awarded by USAID or other development agencies?

The $35.8 million contract value for this four-year engagement appears to be within the mid-to-high range for complex public financial management (PFM) reform projects managed by major development agencies like USAID. Such contracts often involve extensive technical assistance, policy advisory, institutional strengthening, and capacity building across multiple government ministries. Factors influencing cost include the scope of work, duration, geographic location, and the level of expertise required. For instance, projects focused on modernizing tax systems, improving budget execution, or enhancing public procurement often require significant financial and human resources. Without direct comparison data for identical projects, it's reasonable to infer that this funding level reflects the substantial effort needed to achieve meaningful PFM reform in a partner country.

What are the primary risks associated with this contract, and how are they being mitigated?

The primary risks associated with this contract include potential cost overruns due to the time-and-materials (T&M) pricing structure, which lacks a fixed ceiling for labor hours. Another significant risk is the potential for scope creep, where project objectives expand beyond the original intent, leading to increased costs and delays. Furthermore, there's a risk of insufficient local capacity building, creating dependency on external consultants for sustained reform. Mitigation strategies typically involve robust contract management by USAID, including close monitoring of expenditures, regular performance reviews, clear definition and control of the scope of work, and a strong emphasis on knowledge transfer and training for Jordanian officials. The success of these mitigation efforts is crucial for achieving long-term sustainability.

How effective is the time-and-materials (T&M) contract type for achieving long-term fiscal reform objectives?

The time-and-materials (T&M) contract type offers flexibility, allowing for adjustments in scope and effort as project needs evolve, which can be beneficial in complex reform environments where challenges may not be fully predictable. However, T&M contracts carry inherent risks for the government, primarily the potential for uncontrolled cost escalation, as the contractor is reimbursed for actual labor hours and materials used. For long-term fiscal reform, which requires sustained effort and deep institutional change, this flexibility can be advantageous. Nevertheless, effective oversight, detailed reporting requirements, and potentially incorporating cost ceilings or fixed-price components for specific deliverables are crucial to manage costs and ensure value for taxpayer money. The success of T&M hinges heavily on diligent contract administration.

What is the expected impact of this contract on Jordan's public financial management systems and overall economic stability?

The expected impact of this contract on Jordan's public financial management (PFM) systems is significant, aiming to enhance efficiency, transparency, and accountability in government financial operations. Improvements in areas like budgeting, revenue administration, public debt management, and financial reporting are anticipated. By strengthening these PFM systems, the contract seeks to improve the government's ability to allocate resources effectively, manage public finances prudently, and enhance service delivery to citizens. This, in turn, is expected to contribute to greater economic stability by fostering investor confidence, improving fiscal discipline, and creating a more predictable economic environment. The ultimate success depends on the effective implementation of reforms and the commitment of Jordanian authorities.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 6

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Deloitte LLP (UEI: 014127109)

Address: 1725 DUKE ST, ALEXANDRIA, VA, 22314

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $35,868,471

Exercised Options: $35,868,471

Current Obligation: $35,868,471

Actual Outlays: $7,649,803

Subaward Activity

Number of Subawards: 15

Total Subaward Amount: $11,042,381

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: AIDOAAI1200036

IDV Type: IDC

Timeline