Kerry Blasts Bush Administration on Small Business Development Oversight

John Kerry, Ranking Democrat on the Committee on Small Business and Entrepreneurship, called on the Bush Administration today, to take steps to address a pattern of poor and non-existent oversight of small business contracting programs. Kerry sent a letter to Small Business Administration (SBA) head Hector Barreto expressing his concerns that the government is ignoring its responsibility to enforce regulations in its cornerstone business development program, as outlined in a March 16, 2006 report by the agency’s Office of Inspector General.

“Incompetence, ineffective leadership, inept management in responding to Hurricane Katrina, and a complete dereliction of duty by the Bush Administration to oversee federal contracts is hurting our small businesses,” said Kerry. “In case after case, reports like this one from the SBA’s own inspector general find significant failures in this Administration's oversight. This latest report proves the Administration is hurting the very program that helps minority and women-owned firms access federal contracts. The Administration offers lip service about doing more with less, but it’s America’s small businesses that get less with more - less oversight, less accountability, less opportunities and more red tape, more failure, and more disappointment.”

The nation’s top program for socially and economically disadvantaged firms, the 8(a) Business Development program is key to helping African Americans, Hispanic Americans, Native Americans, Asian Pacific Americans, and women owned businesses gain access to contracts with federal agencies.

However, the Inspector General’s report found ineffective monitoring by the SBA of 26 agencies’ implementation of the program. Agencies failed to “detect if companies were not complying with [8(a)] regulations” and SBA performed no oversight of the Agencies or the contractors, which resulted in violations of the regulations, according to the report.

Kerry wrote, “For over three decades, this essential business development program has assisted countless firms in creating hundreds of thousands of jobs, billions in tax revenue, and has played a direct role in the creation of a diverse supplier base for the federal government. An effective level of oversight must be maintained to ensure that violators are identified and held accountable for their actions. The SBA cannot allow inaction by procuring agencies or within its own ranks to undermine its cornerstone business development program.”

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