The Pentagon is tightening standards governing the use of a contracting mechanism increasingly utilized to grant billions of dollars in awards and incentive pay to defense firms that provide services and build weapon systems. Specifically, the Defense Department began this month to pare back the use of cost-plus-award-fee contracts, which rely heavily on subjective assessments of government contracting officials, in favor of contracts that employ objective criteria for rewarding performance. Critics have charged that past cost-plus-award-fee deals have wasted taxpayer...
