- US government agencies must purchase IT centrally under new order
- 6,000 contracts have already been terminated or made cheaper
- The goal is to reduce waste and save taxpayer dollars
US President Donald Trump has signed an executive order to centralize federal IT procurement under the General Services Administration (GSA), a 76-year-old agency which oversees purchasing.
The move means the Office of Management and Budget (OMB) must pass government-wide acquisition contracts through the GSA.
The order, signed on March 20, 2025, goes by the name “Eliminating Waste and Saving Taxpayer Dollars by Consolidating Procurement.”
US government to centralize IT spending
The White House explained the US government spends “approximately $490 billion per year on Federal contracts for common goods and services” and called for the most efficient and effective purchasing of these goods and services with the American taxpayer’s dollar.
Besides being smarter with the money it spends, the Trump administration also hopes the move will help stamp out waste and duplication.
In the two months leading up to the signing of the executive order, the US government had already terminated or economized over 6,000 contracts.
The separately published fact sheet goes on to explain that agencies have independently purchased licenses for productivity software like Microsoft 365, leading to pricing inconsistencies and other challenges.
By bringing all of this under the watchful eye of the General Services Administration, Trump hopes to save $100 million per year.
A saving of $150 million in FY 24 was also noted with regard to the centralization of identity protection services to prevent and respond to data breaches.
Moving on to hardware, an estimated $1 billion annually is spent purchasing computers for staff, yet only $6 billion has gone through the GSA in a whole decade, highlighting the scale of potential savings. NASA, NIH, Army, and GSA have each set up volume purchasing agreements with the GSA, but other agencies have not.
All in, the Department of Government Efficiency (DOGE) has identified “more than $100 billion in estimated savings” across various areas of ID, including hardware, software and regulatory savings.
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