PBGC Spends $10M on Investment Advice from Barclays Capital Inc. Over 5 Years

Contract Overview

Contract Amount: $10,084,125 ($10.1M)

Contractor: Barclays Capital Inc.

Awarding Agency: Pension Benefit Guaranty Corporation

Start Date: 2007-06-07

End Date: 2012-03-31

Contract Duration: 1,759 days

Daily Burn Rate: $5.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: INVESTMENT ADVICE

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20005

State: District of Columbia Government Spending

Plain-Language Summary

Pension Benefit Guaranty Corporation obligated $10.1 million to BARCLAYS CAPITAL INC. for work described as: INVESTMENT ADVICE Key points: 1. Significant contract value for investment advice services. 2. Full and open competition was utilized. 3. Potential risk associated with reliance on a single firm for advice. 4. Financial services sector spending.

Value Assessment

Rating: fair

The contract value of $10M over 5 years for investment advice is substantial. Benchmarking against similar contracts for large pension funds would be necessary to assess if this pricing is competitive.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a robust price discovery process. However, the specific pricing structure and negotiation details are not provided.

Taxpayer Impact: Taxpayer funds are being used for pension fund management, with the efficiency of this spending depending on the quality of advice received and its impact on fund performance.

Public Impact

Pension Benefit Guaranty Corporation (PBGC) utilizes external expertise for managing its investments. The contract duration of nearly 5 years indicates a long-term need for these services. Transparency in the selection process is suggested by the 'full and open competition' award.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Concentration risk if Barclays Capital Inc. is the sole provider of critical advice.
Potential for conflicts of interest in investment advice.
Effectiveness of advice is not directly measurable from contract data.

Positive Signals

Competitive bidding process ensures some level of price justification.
PBGC is actively managing its investment portfolio.
Contract awarded to a well-known financial institution.

Sector Analysis

This contract falls within the financial services sector, specifically investment management and advisory. Spending benchmarks for government agencies on similar advisory services can vary widely based on fund size and complexity.

Small Business Impact

This contract does not appear to involve small businesses, as it was awarded to a large financial institution, Barclays Capital Inc.

Oversight & Accountability

Oversight would involve monitoring the performance of the investment advice provided by Barclays Capital Inc. and ensuring adherence to the contract terms and PBGC's investment policies.

Related Government Programs

Investment Advice
Pension Benefit Guaranty Corporation Contracting
Pension Benefit Guaranty Corporation Programs

Risk Flags

Lack of specific performance metrics.
Potential for over-reliance on a single advisory firm.
Limited insight into the quality and impact of the advice.
No clear indication of cost-effectiveness beyond the bidding process.

Frequently Asked Questions

What is this federal contract paying for?

Pension Benefit Guaranty Corporation awarded $10.1 million to BARCLAYS CAPITAL INC.. INVESTMENT ADVICE

Who is the contractor on this award?

The obligated recipient is BARCLAYS CAPITAL INC..

Which agency awarded this contract?

Awarding agency: Pension Benefit Guaranty Corporation (Pension Benefit Guaranty Corporation).

What is the total obligated amount?

The obligated amount is $10.1 million.

What is the period of performance?

Start: 2007-06-07. End: 2012-03-31.

What was the specific scope of investment advice provided, and how did it contribute to the PBGC's financial health?

The contract data does not specify the exact nature of the investment advice. To assess value, one would need to examine the PBGC's investment performance reports during the contract period and correlate it with the strategic guidance provided by Barclays Capital Inc. This would involve analyzing asset allocation, risk management strategies, and overall portfolio returns against relevant benchmarks.

What were the key performance indicators (KPIs) used to evaluate the effectiveness of Barclays Capital Inc.'s investment advice?

Contract details typically outline performance standards. For investment advice, KPIs might include portfolio performance relative to market indices, adherence to risk tolerance levels, and the quality of strategic recommendations. Without access to the specific contract's SOW and performance metrics, it's difficult to definitively assess effectiveness beyond the competitive award process.

How did the 'full and open competition' process ensure the best possible pricing and quality of service for this $10M contract?

Full and open competition theoretically allows any qualified vendor to bid, fostering a competitive environment that drives down prices and encourages high-quality service offerings. The PBGC would have evaluated bids based on a combination of price, technical qualifications, and past performance. The success of this process in securing optimal value depends on the thoroughness of the evaluation criteria and the number of competitive bids received.

Industry Classification

NAICS: Finance and Insurance › Other Financial Investment Activities › Investment Advice

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: PBGC01-RP-07-0003

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 745 7TH AVE, NEW YORK, NY, 90

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $10,857,125

Exercised Options: $10,109,125

Current Obligation: $10,084,125

Timeline