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Irs Competitive Sourcing : The Top 6 Myths 2/24/05

By United States Department of the Treasury

Excerpt: Fact The Office of Management and Budget (OMB) reported that the 217 public-private competitions in FY 2004 are collectively estimated to generate net savings of approximately 1.4 billion over three to five years. One-time incremental costs to conduct the studies and oversight costs were approximately $110 million, which brings net savings to $1. billion. (Jan. 25, 2005 Report to Congress) Annual savings add up to about $552 million -- roughly $22,000 average savings per Full Time Equivalent (FTE) studied. Since the government pays about $80,000 per FTE annually in salary and benefits, Competitive Sourcing efforts in FY 2004 yielded an average of 27 percent savings per FTE studied. The IRS first two major completed studies will save taxpayers more than $185 million over the next five years.


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