How will U.S. Agency for International Development partners be affected by the new $487,000 cap on U.S. government contractor pay? Tempest in a teapot or not, a Washington, D.C.-based industry association is encouraging organizations to take a close look at their executive compensation plans.
“Governmentwide, USAID contractors will likely be affected by it,” Alan Chvotkin executive vice president and counsel for the Professional Services Council, told Devex, referring to the provision in the Bipartisan Budget Act 2013 passed at the end of 2013.
Though PSC won’t speculate how many people the provision might affect, “it will mostly be company executives,” and it could inhibit the ability of companies to attract top talent, he added.
According to a Washington insider who asked to remain anonymous, the cap is more of a “non issue” for development contractors, as it would only affect very few organizations. Instead, the challenge is more about instituting an arbitrary cap that isn’t addressing the government’s fundamental challenges to boost value for money.