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GCN Home > 09/20/04 issue

OMB to call for shared finance and HR apps

By Jason Miller, GCN Staff

The Bush administration is crafting a plan to outsource the government’s financial and human resources processing to vendors and federal service centers.

Under the lines-of-business consolidation effort, two task forces have submitted business cases recommending that agencies consolidate redundant systems in a shared-services environment. The Office of Management and Budget will fine-tune them during the next few months for inclusion in the fiscal 2006 budget proposal.

“We are talking about IT hosting services at a minimum and the different functions across the lines of business for a fee as this concept evolves,” Tim Young, OMB’s associate administrator for e-government and IT, said this month at the 2004 Interagency Resources Management Conference in Cambridge, Md.

“The E-Payroll project was the proof of concept for the lines of business, and it shows we can consolidate to a shared-services environment,” he said.

Once the budget is approved, Young said, there would be a competitive process to determine the service providers for financial and HR services.

In a shared-services environment, agencies own the data but not the technology, members of a panel at the conference said. E-Payroll is a cross-agency initiative to share payroll processing and have service providers handle payroll functions for a fee.

Agencies would save money on hardware and software, as well as management and maintenance support, while retaining control and accountability for financial and HR data.

The task forces estimate that at least six service providers will be needed to support financial management and six to process HR data governmentwide.

The Interior Department’s National Business Center is one of several federal groups that provide processing services to agencies.

Tim Vigotsky, the center’s director, said his organization submitted two business cases to OMB last week outlining its funding needs to provide financial and HR services. The center is also one of the four providers for E-Payroll.

“All of this gives us the opportunity to improve and standardize business practices across the federal government,” Vigotsky said. “This is where the most significant gains can be made.”

More news on related topics: Acquisition / Contracts, Business Process Management, Management, Outsourcing, IT Management