A new joint House-Senate report  on the fiscal 2008 intelligence authorization bill scrutinizes the U.S. intelligence community's growing reliance on private contractors, reports Walter Pincus of The Washington Post today [1].

Director of National Intelligence Mike McConnell was directed to produce a comprehensive report by the end of March describing the "activities performed by contractors" in all 16 intelligence agencies and how they are overseen. McConnell also was given the unusual authority to convert positions currently occupied by contractors into full-time positions by allowing him to increase personnel levels, by no more than 10 percent in any agency.

The report also wants McConnell to define what the appropriate job description is for a private contractor to ensure that contractors are not doing work better performed by government employees.

Then there's the concern over salary discrepancies.

Simply put: Government employees are cheaper... much cheaper. A civilian government employee's average salary and benefits package costs taxpayers $126,500 annually, while the average salary and benefits package for a "core contractor" costs $250,000 a year.  A major reason why a private contract employee costs double his civilian government counterpart is that the contracting company factors administrative overhead and profit into the price of its worker.

Pincus notes that  the growth in contract employees exploded after 9-11 because the government wanted to muscle up its intelligence capacity, but now the tide is turning as Congress tells McConnell that it's time to find "the appropriate balance of contractors and permanent employees."