GAO: Postal Service Hasn't Shown That Outsourcing Delivers
By ARI PAUL
The U.S. Postal Service has not provided enough data to show that outsourcing labor is needed to cut costs and improve service, a report from the U.S. Government Accountability Office stated July 31.

WILLIAM BURRUS: Wait a minute, Mr. Postman.

The GAO suggested that the Postmaster General establish a way to track outsourcing and efficiency that falls within the scope of collective bargaining agreements. A bill in the U.S. House of Representatives would mandate that the USPS bargain with unions before it engages in outsourcing.

'No Proof Outsourcing Works'

"The service lacks information and data about the results of its outsourcing efforts that could be used to determine whether they are effective and to support future outsourcing in the face of possible challenges," the GAO report said. "For example, the service does not know the savings related to its outsourcing efforts because it does not have a process to evaluate the impact of outsourcing or to track actual savings."

It continued, "Without information on results, such as costs, savings, or efficiency gains, service managers, stakeholders and Congress are not able to assess the risk and value of outsourcing and accountability for results is limited."

In a letter to the GAO responding to its assessment, USPS Executive Vice President Anthony Vegliante admitted that the service could not track outsourced labor contracts but said it did "have data to support postal outsourcing decisions, e.g., cost differences between contracted transportation services versus postal vehicle services for those routes," and that the service's "Inspector General completed audits regarding outsourcing activities that found that not only have estimated savings been achieved but far exceeded."

While noting that only two percent of postal deliveries are conducted with outsourced transportation, Mr. Vegliante also said that the USPS has been able to cut $1 billion from its annual spending in the last five years.

"Though their specific contributions to these achievements are not segregated, outsourcing some work and avoiding major capital expenditures are significant factors in meeting our financial goals," he said. "At the same time, it should be noted that the Postal Service met these corporate goals without layoffs."

American Postal Workers Union President William Burrus hailed the report's findings.

"The GAO is echoing views we have expressed for years," he said in a statement. "The Postal Service simply cannot demonstrate that outsourcing is more efficient than using postal employees to perform core functions."