The General Services Administration has asked leaders of McKinsey, BCG and four other consulting firms to justify their federal contracts and suggest ways to save costs, The Wall Street Journal reported Thursday.
“Our objective is to critically evaluate which engagements deliver genuine value,” Josh Gruenbaum, commissioner of GSA’s Federal Acquisition Service, wrote in a letter sent to firms Thursday. “In keeping with this Administration’s laser focus on fiscal responsibility, our baseline presumption is that most, if not all, of these contracted services are not core to agency missions.”
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According to people familiar with the initiative, GSA also sent letters to EY, Alvarez & Marsal, AlixPartners and FTI Consulting.
In the letter, Greenbaum, a 2025 Wash100 awardee, asked the consulting firms to explain their projects’ pricing structure and discuss their existing federal contracts in plain language. Responses to GSA’s request are due July 11.
GSA also requested that the firms transition to outcomes-based contracts, in which vendors are paid based on meeting certain results.
GSA Review of Consulting Contracts
GSA is overseeing an administration-wide review of spending on consultants and other contractors to determine which tasks can be carried out by federal personnel and which can be done by external consultants.
In his letter, Greenbaum wrote that the agency’s review of consulting contracts has led to $23.3 billion in savings in multiyear awards.
