The Government Accountability Office (GAO) said in a report publicly issued last week it recommends the Department of Energy’s Office of Environmental Management (EM) take steps to improve a system used to monitor contractor performance.
A provision in the 2024 National Defense Authorization Act calls for GAO to “examine EM’s oversight of contractors’ assurance systems,” according to the report.
DOE’s Office of Environmental Management spends about 95% of its annual budget, of roughly $8 billion, on contractors and a contractor workforce of around 25,000 employees, GAO said in the report.
“In general, DOE expects certain contractors to oversee their own performance, identify and report potential problems, and implement corrective actions to prevent recurrence by designing and implementing contractor assurance systems (CAS),” GAO said.
According to the GAO report, at least three nuclear cleanup field offices, the Hanford Site in Washington state, the Idaho National Laboratory and the Los Alamos National Laboratory in New Mexico, dubbed their contractor oversight effective despite many shortcomings.
“Without defining what constitutes an effective CAS—including establishing specific, measurable evaluation criteria—field offices do not have concrete guidelines for evaluating CASs and their determinations may be less informative or meaningful as a result,” GAO said. “Additionally, the lack of a clear definition hinders EM’s ability to hold the contractor accountable, and EM cannot be assured that contractors can effectively and efficiently manage risks.”
“GAO is making four recommendations to EM, including that it define CAS effectiveness and establish specific, measurable evaluation criteria,” according to the report. DOE concurred with the recommendations and said it plans to carry out all the changes by the end of 2028.
Four years ago, the Defense Nuclear Facilities Safety Board (DNFSB) “reported that DOE leverages CAS information without sufficient and documented justification that it is reliable and effective,” GAO said.
“In addition, in 2024, DOE’s Office of Enterprise Assessments reported that contractors inadequately managed 25 percent of issues from a representative sample of about 4,000 issues across nine DOE sites, including three EM sites,” GAO said.
The GAO audit of contractor oversight systems was conducted over almost two years and ended in August.