"The Defense Department is joining several other agencies in a top-to-bottom review of 8(a) small business contracts. In a video posted Friday to X, Defense Secretary Pete Hegseth said the department will review all 8(a) contracts valued at more than $20 million. He called the decades-old Small Business Administration program a "breeding ground for fraud" and said it is "swamp code words for DEI race-based contracting." DEI refers to diversity, equity and inclusion."
"The Defense Department will review 8(a) contracts for two things. First, a "lethality" criterion will be used. "If a contract doesn't make us more lethal, it's gone," Hegseth said. "There is no room in our budget for wasteful DEI contracts that don't help us win wars." The second review will target pass-through arrangements to ensure "every small business getting a contract is the one actually doing the work, and not just some shell company funneling your money to a giant consulting firm," Hegseth said."
The Defense Department will conduct a top-to-bottom review of all 8(a) contracts valued above $20 million and join other agencies already investigating 8(a) awards. Secretary Pete Hegseth labeled the Small Business Administration's 8(a) program a "breeding ground for fraud" and called program language "swamp code words for DEI race-based contracting," asserting DEI undermines mission effectiveness. Treasury, Justice and SBA are reviewing their 8(a) contracts. The Defense Department, the largest 8(a) user by far, will apply a lethality criterion and target pass-through arrangements, starting with sole-source awards that totaled $9.7 billion in fiscal 2025.
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