State Department awarded $21.8M for embassy security in South Africa, with G4S Secure Solutions winning the contract

Contract Overview

Contract Amount: $21,821,319 ($21.8M)

Contractor: G4S Secure Solutions (USA) Inc.

Awarding Agency: Department of State

Start Date: 2004-03-01

End Date: 2009-05-31

Contract Duration: 1,917 days

Daily Burn Rate: $11.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: LOCAL GUARD PROGRAM FOR US EMBASSY IN SOUTH-AFRICA AND CONSTITUENT POSTS IN JOHANNESBURG, DURBAN AND CAPE TOWN

Plain-Language Summary

Department of State obligated $21.8 million to G4S SECURE SOLUTIONS (USA) INC. for work described as: LOCAL GUARD PROGRAM FOR US EMBASSY IN SOUTH-AFRICA AND CONSTITUENT POSTS IN JOHANNESBURG, DURBAN AND CAPE TOWN Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration of approximately 5 years (1917 days) indicates a long-term security need. 3. The fixed-price with economic price adjustment (EPA) contract type aims to manage cost fluctuations. 4. The North American Industry Classification System (NAICS) code 561612 points to specialized security guard services. 5. The award was made by the Department of State, highlighting its role in protecting diplomatic facilities. 6. No small business set-aside was utilized, indicating the primary award was not specifically targeted for small businesses.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific performance metrics or detailed cost breakdowns. The total award amount of $21.8 million over nearly five years averages to approximately $4.36 million annually. This figure needs to be compared against the cost of similar security contracts for U.S. embassies in comparable regions to assess value for money. The fixed-price with EPA structure suggests an attempt to control costs while accounting for potential economic shifts, but the ultimate cost-effectiveness depends on the execution and the accuracy of the economic adjustments.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a 'full and open competition' solicitation, meaning all responsible sources were permitted to submit bids. The presence of 6 bidders (indicated by 'no': 6) suggests a reasonable level of competition for this security service requirement. A competitive process generally helps in achieving fair market prices and encourages contractors to offer their best value propositions. The specific details of the bidding process, such as the number of proposals received and the evaluation criteria, would provide further insight into the strength of the competition.

Taxpayer Impact: A full and open competition is generally favorable for taxpayers as it increases the likelihood of obtaining services at competitive prices, preventing potential overcharges that could arise from less competitive arrangements.

Public Impact

The primary beneficiaries are the U.S. Department of State and its personnel stationed at the embassy and constituent posts in South Africa. The contract ensures the provision of security guards and patrol services to protect diplomatic facilities and personnel. The services are geographically focused on South Africa, specifically the U.S. Embassy in Pretoria and its consulates in Johannesburg and Durban. The contract supports the workforce employed by G4S Secure Solutions (USA) Inc. in South Africa, contributing to local employment in the security sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to the economic price adjustment (EPA) clause if economic factors escalate significantly.
Reliance on a single contractor for critical security functions could pose risks if performance issues arise or if the contractor faces operational challenges.
The effectiveness of security services is highly dependent on the quality of personnel and adherence to protocols, which can be difficult to monitor remotely.

Positive Signals

Awarded through full and open competition, which typically leads to better pricing and service quality.
The fixed-price component of the contract provides a baseline cost control measure.
The long-term nature of the contract (nearly 5 years) suggests a stable and predictable security solution for the diplomatic missions.

Sector Analysis

The security services sector is a significant part of the global economy, encompassing a wide range of protective measures. For government contracts, particularly those involving diplomatic security, the market demands high reliability, extensive vetting, and adherence to strict protocols. This contract falls within the broader security and investigation services industry, specifically focusing on guarding and patrol. Comparable spending benchmarks would involve analyzing other contracts for embassy security in similar geopolitical regions or for similar-sized diplomatic missions.

Small Business Impact

The data indicates that this contract was not awarded as a small business set-aside ('sb': false). This means the competition was open to businesses of all sizes, and the primary award went to G4S Secure Solutions (USA) Inc., which is likely a large corporation. There is no explicit information on subcontracting plans for small businesses within this award. The absence of a small business set-aside suggests that opportunities for small businesses may be limited unless they are part of the supply chain or subcontracting network established by the prime contractor.

Oversight & Accountability

Oversight for this contract would primarily fall under the purview of the U.S. Department of State's Bureau of Diplomatic Security (DS) and the contracting officer's representative (COR). These entities are responsible for monitoring contractor performance, ensuring compliance with contract terms, and managing any modifications or disputes. Transparency is facilitated through contract award databases like FPDS. Accountability measures are built into the contract through performance standards and potential penalties for non-compliance. Inspector General jurisdiction would typically apply if systemic issues or fraud were suspected.

Related Government Programs

Worldwide Protective Services
Embassy Security Contracts
Guard Services Contracts
Department of State Security Operations

Risk Flags

Potential for cost escalation due to Economic Price Adjustment (EPA) clause.
Contract duration of nearly 5 years requires ongoing performance monitoring.
Reliance on a single contractor for critical security functions.

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $21.8 million to G4S SECURE SOLUTIONS (USA) INC.. LOCAL GUARD PROGRAM FOR US EMBASSY IN SOUTH-AFRICA AND CONSTITUENT POSTS IN JOHANNESBURG, DURBAN AND CAPE TOWN

Who is the contractor on this award?

The obligated recipient is G4S SECURE SOLUTIONS (USA) INC..

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $21.8 million.

What is the period of performance?

Start: 2004-03-01. End: 2009-05-31.

What is the historical spending pattern for local guard programs at U.S. embassies in South Africa?

Analyzing historical spending for local guard programs at U.S. embassies in South Africa requires access to detailed historical contract data. Without specific prior contracts for this exact function and location, it's difficult to establish a precise pattern. However, the $21.8 million awarded over approximately five years suggests an average annual expenditure of around $4.36 million for security services at these posts. This figure should be compared to previous contract values, if available, to identify trends in cost escalation or changes in service scope. Factors such as evolving security threats, inflation, and changes in diplomatic presence could influence historical spending.

How does the pricing of this contract compare to similar security contracts for U.S. diplomatic missions in other African countries?

A direct price comparison requires access to data on similar contracts, including the scope of services, duration, number of personnel, and specific security requirements. The average annual cost of approximately $4.36 million for this contract needs to be benchmarked against contracts for embassies of comparable size and threat level in other African nations. Factors like local labor costs, prevailing security risks, and the specific security infrastructure at each post can significantly influence pricing. Without such comparative data, it's challenging to definitively state whether this contract's pricing is above or below market rates for similar services in the region.

What are the specific performance metrics and Key Performance Indicators (KPIs) used to evaluate G4S Secure Solutions' service delivery?

The provided data does not detail the specific performance metrics or Key Performance Indicators (KPIs) for this contract. Typically, security contracts include KPIs related to response times, incident reporting accuracy, personnel punctuality, adherence to post orders, and the successful prevention of security breaches. The Department of State's Bureau of Diplomatic Security would establish and monitor these metrics. Performance evaluations are crucial for ensuring the effectiveness of the security services and for holding the contractor accountable. A review of the contract's Statement of Work (SOW) or Performance Work Statement (PWS) would reveal these specific requirements.

What is the track record of G4S Secure Solutions (USA) Inc. in providing similar security services to U.S. government facilities abroad?

G4S Secure Solutions (USA) Inc. is a major global provider of security services and has a history of contracting with various government agencies, including the U.S. Department of State. Their track record typically involves providing physical security, personnel security, and related services to embassies, consulates, and other federal facilities worldwide. While specific performance details for this particular contract are not available in the summary data, G4S's extensive experience suggests a capacity to handle such requirements. However, like any large contractor, their performance history may include both successes and areas for improvement, which would be assessed through past performance evaluations during the bidding process and ongoing contract monitoring.

What are the potential risks associated with the 'Fixed Price with Economic Price Adjustment' (FP-EPA) contract type for this security service?

The FP-EPA contract type aims to balance cost certainty with the need to account for fluctuating economic conditions, particularly relevant for longer-term contracts. For this security service contract, the primary risk for the government is that economic price adjustments could lead to costs exceeding initial projections if inflation or other economic factors (e.g., currency exchange rates, labor cost index changes) rise significantly. Conversely, the contractor is protected against unforeseen economic downturns that could erode profit margins. The effectiveness of the EPA clause depends on the specific indices used and the caps or limitations placed on adjustments to mitigate excessive cost increases for the taxpayer.

How many security personnel are estimated to be deployed under this contract, and what are the implications for local employment?

The provided data does not specify the exact number of security personnel deployed under this contract. However, given the scope of securing a U.S. Embassy and constituent posts in a major country like South Africa, it is reasonable to infer that a significant number of guards would be required, potentially ranging from dozens to over a hundred, depending on the posts' security levels and operational hours. The contract's duration and value suggest a substantial workforce. This would have positive implications for local employment in South Africa, as the contractor, G4S Secure Solutions, would likely hire and train local personnel to fulfill the security guard duties, contributing to the local economy.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Investigation and Security Services › Security Guards and Patrol Services

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation ID: SSF75003R0019

Offers Received: 6

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Contractor Details

Parent Company: G4S PLC (UEI: 737341631)

Address: 4200 WACKENHUT DR, PALM BEACH GARDENS, FL, 21

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $47,215,758

Exercised Options: $38,136,866

Current Obligation: $21,821,319

Contract Characteristics

Multi-Year Contract: Yes

Cost or Pricing Data: NO

Timeline