VA’s contracting crackdown gave some staff hours to do hundreds of reviews

The Veterans Affairs Department moved quickly to eliminate hundreds of contracts last year at the Department of Government Efficiency’s urging – in some cases, giving officials only a few hours to review contracts marked for elimination. 

VA’s Office of Inspector General found in a report this week that the agency terminated 435 contracts last year, valued at $1.1 billion. About 86% of those cancelled contracts were for consulting services. VA OIG reviewed 2,210 contracts in total. 

These contracts were “terminated for convenience,” meaning the VA determined it was in the federal government’s best interest to end them. The report also found VA contracting officers terminated another 100 contract actions, but eventually reinstated them.

The watchdog office, led by a former senior adviser to VA Secretary Doug Collins, noted VA reviewed these contracts quickly under strict deadlines, but found contracting officials generally complied with Federal Acquisition Regulation (FAR) requirements for terminating contracts. 

“Despite a challenging and fast-paced process, VA officials implemented procedures to review contracts before terminating them, which reduced the risk of terminating critical services,” the report states. 

VA has the second-largest acquisition budget in the federal government. It obligated more than $78 billion in contracts in fiscal 2025. 

VA Press Secretary Quinn Slaven told Government Executive in a statement that “thanks to the methodical and careful review process VA put in place, these contract cancellations had no negative impact whatsoever on VA care and benefits.” 

“Instead, the department is reinvesting these massive savings to make landmark improvements to VA care and benefits,” Slaven added. 

At the request of officials from DOGE and the General Services Administration, VA created a list of professional services and consulting contracts that the agency should consider eliminating. 

VA contracting staff were instructed to complete a questionnaire for each contract marked for termination. The OIG report notes these contracts were culled by VA officials, “not a Department of Government Efficiency artificial intelligence program." ProPublica reported last summer that a DOGE official developed an error-prone AI tool to assist VA in its review of contracts to terminate. 

According to the OIG report, senior VA officials set up a process to reduce the risk of terminating critical contracts. Offices were required to justify keeping critical contracts and identify the potential impact of veterans’ healthcare and benefits if certain contracts were terminated. 

Officials were required to fill out questionnaires for contacts deemed essential. The questionnaire asked officials to consider whether the contracted tasks could be performed by VA employees, how soon it would take the VA workforce to take over this work, and whether these contracts provided specialized skills that VA could not easily hire on its own. 

The IG office wrote that the “speed and volume” of these contract reviews created challenges for VA staff. In some cases, VA officials had two weeks, or “only a few hours,” to review hundreds of contracts. 

According to the VA OIG, some officials were given less than 11 hours to complete their review, obtain approval from deputy undersecretaries, deputy assistant secretaries or senior leaders, and submit responses to the Office of Acquisition, Logistics, and Construction (OALC). 

A VA Category Management Support Office director told OIG auditors that VA senior advisers and DOGE officials directed VA employees to terminate contracts on Feb. 25, 2025, regardless of "incomplete reviews.” 

President Donald Trump signed an executive order on his first day in office last year eliminating “diversity, equity, and inclusion” activities in the federal government. By February 2025, Collins ordered a review of all VA contracts. 

VA submitted two lists of terminated contracts to Congress – one in May 2025, the other in July 2025. The OIG determined that “both lists of terminated contracts were incomplete and inaccurate.” 

The report determined that “officials who contributed to the information provided to Congress were unfamiliar with contracting and acquisition terminology, which may have caused the mischaracterization of the data.” 

The May 2025 list reported that VA terminated 446 contract actions worth about $120 billion. A contracting official told the OIG that VA created a dashboard to track the terminated contracts, but miscalculated the contract values. A VA official told the OIG that DOGE representatives also “wanted to claim credit for any contacts that ended, including those that simply reached the end of their performance period.” 

“VA has since provided Congress with updated and clearer information on the contracts that it terminated,” VA OIG wrote. 

VA OIG began its audit last summer at the request of Senate VA Committee Ranking Member Richard Blumenthal, D-Conn., and Sen. Angus King, I-Maine, a member of the committee.

Blumenthal said in a statement that the OIG report shows the cancellation of contracts at the VA was driven by DOGE and political leadership, not subject-matter experts at the VA.  

“Secretary Collins owes us answers on how VA will replace lost services and how much this fiasco has cost taxpayers in arbitration, settlements, and reinstatements. Veterans and taxpayers deserve transparency and a full public accounting,” Blumenthal said.