GAO-10-266R, Warfighter Support 

United States Government Accountability Office

Washington, DC 20548 

March 4, 2010 

Congressional Committees 

Warfighter Support: A Cost Comparison of Using State Department Employees 

versus Contractors for Security Services in Iraq 

The U.S. government’s reliance on contractors, including the State Department’s and 

Department of Defense’s (DOD) use of private security contractors in Iraq, has been 

well documented. We and others have examined many of the challenges the 

government faces using contractors in Iraq, including issues related to the scope of 

private security contractors’ activities, the challenges in providing sufficient 

oversight, the appropriate accountability processes, and difficulties in conducting 

background screenings of foreign national contractor employees.1

 (A list of related 

GAO products can be found at the end of this report.) What has not been so well 

examined is the comparative cost of using civilian employees or military members 

versus the cost of using contractors, particularly private security contractors, during 

contingency operations such as Operation Iraqi Freedom. Generally, when costs have 

been discussed, the focus has been on the daily rate paid to contractor employees, 

rather than on the total costs of using State Department or DOD personnel. However, 

in October 2005, the Congressional Budget Office (CBO) issued a study that 

compared the cost of using military personnel, federal civilians, or contractors to 

provide logistic support for overseas operations.2

 The study concluded that over a 20-

year period, using Army military units would cost roughly 90 percent more than using 

the contractor. Also, in an August 2008 report on contractor support in Iraq, the 

Congressional Budget Office conducted a comparison of one contractor’s costs to 

provide private security services in Iraq versus estimated military costs.3 The report 

concluded that for the 1-year period beginning June 11, 2004, the costs of the private 

contractor did not differ greatly from the costs of having a comparable military unit 

performing similar functions. Because of the broad level of interest by Congress in 

issues dealing with Iraq, the Comptroller General performed this review under his 

authority to conduct evaluations on his own initiative. For this engagement, 

congressional interest specifically focused on determining the costs to the 

Department of Defense and the State Department of using private security 

contractors for security services versus using federal employees to provide the same 

 

1

 Rebuilding Iraq: Actions Needed to Improve Use of Private Security Providers, GAO-05-737 

(Washington, D.C.: July 2005); Military Operations: Background Screenings of Contractor Employees 

Supporting Deployed Forces May Lack Critical Information, but U.S. Forces Take Steps to Mitigate 

the Risk Contractors May Pose, GAO-06-999R (Washington, D.C.: September 2006). 2

 CBO, Logistics Support for Deployed Military Forces (October 2005). 3

 CBO, Contractors’ Support of U.S. Operations in Iraq Pub. No. 3053 (August 2008). 
services. However, DOD was unable to provide us with the information necessary to 

address our engagement objective. Although DOD provided some data on military 

personnel costs,4

 DOD officials told us they could not provide other data necessary to 

complete a cost comparison. For example, DOD could not provide information 

regarding the number and rank of military personnel that would be needed to meet 

contract requirements. Also, DOD could not provide information on the cost to train 

personnel to perform the security functions. DOD officials told us that in order to 

provide data for a cost comparison they would have to form a team from several DOD 

organizations which would need to analyze each specific contract’s requirements to 

determine the number and rank of personnel needed to meet the requirements. 

Therefore, we focused our review on the comparison of the State Department’s costs 

to use private security contractors—to perform both personal and static security5

functions—as opposed to using State Department employees to perform those same 

functions. 

To address our objective, we reviewed the task orders and contract which provided 

security in Iraq and that were current when we began our review—four task orders of 

the Worldwide Personal Protective Services (WPPS) II contracts6

 and one contract 

for Baghdad embassy security. We reviewed and analyzed relevant documents to 

obtain the cost and services provided under each task order and contract. The task 

orders and contract covered the primary security services provided in Iraq for the 

State Department. We interviewed officials from the State Department to obtain 

specific contract information, their estimated cost for providing security services 

with State Department employees, and any cost comparisons conducted related to 

private security services. 7 We met with a private security contractor to discuss their 

contract cost information and to obtain a detailed contract cost breakdown. We 

compared the base year obligated amounts for the four task orders and one security 

contract to total annual costs that the State Department said it would likely incur if 

the department were to provide the services—based on State Department’s 

assumptions. These assumptions included (1) the State Department would have to 

recruit, hire, and train new employees who would all be U.S. citizens; (2) the 

employees would serve 1 year in Iraq and then return to the United States; and (3) the 

State Department would use the same number of employees the contractors use to 

provide security. We focused our analysis on the major quantifiable cost components 

such as salary, benefits, overseas costs, training, recruitment, background screenings, 

 

4

 In July 2005, we reported on DOD’s inability to identify the government’s total cost to provide 

compensation to active duty service members because no single source exists to show the total cost of 

military compensation. See Military Personnel: DOD Needs to Improve the Transparency and 

Reassess the Reasonableness, Appropriateness, Affordability, and Sustainability of Its Military 

Compensation System, GAO-05-798 (Washington, D.C.: July 2005). 5

 Personal security refers to the protective security for high-ranking U.S. government officials, U.S. 

federal civilian personnel, and other individuals traveling in unsecured areas. Static security refers to 

the protection of fixed or static sites, such as military bases, housing areas, and reconstruction work 

sites. 

6

 FAR 16.504 (a) defines the WPPS II contracts as indefinite delivery/indefinite quantity contracts. An 

indefinite delivery/indefinite quantity contract provides for an indefinite quantity within stated limits, 

of supplies or services during a fixed period. When services are required the State Department issues a 

task order which defines the specific requirements and services to be provided by the contractor. 

7

 According to State Department officials, they had not performed an A-76 study or any other cost 

comparison for these services. 

Page 2 GAO-10-266R, Warfighter Support 
and support. The costs that the State Department provided were in fiscal year 2008 

dollars and the costs of the four task orders and the security contract were for earlier 

time periods. In order to make a similar comparison, we converted the private 

security costs into fiscal year 2008 dollars so that they could be compared to the 

fiscal year 2008 costs of the State Department. The State Department also provided 

the number of contractor personnel performing the security missions for each task 

order and contract in Iraq. To determine the total average annual cost for the 

department, the total of each cost component was multiplied by the number of 

personnel the contractor used to provide the services required under the task orders 

and contract. Given the State Department’s 1-year rotation policy, we added 

additional costs for stateside employees who would be needed to replace the 

deployed employees after 1 year. We did not evaluate the quality of the services 

provided by the contractors or whether better services could be provided by the State 

Department. We also did not evaluate the policy implications of using contractors to 

perform security functions. In addition, we did not include the cost of governmentfurnished equipment provided to the contractor because we believe similar 

equipment would be needed if the government provided the services. When using 

contractors, the department also incurs administrative costs for awarding the task 

orders and contract and providing oversight; however, we also did not include these 

costs in our analysis because the State Department was unable to provide an estimate 

of these costs. A detailed discussion of our scope and methodology can be found in 

appendix I. We conducted our review from October 2008 through October 2009 in 

accordance with generally accepted government auditing standards. Those standards 

require that we plan and perform the audit to obtain sufficient, appropriate evidence 

to provide a reasonable basis for our findings based on our audit objectives. We 

believe that the evidence obtained provides a reasonable basis for our findings based 

on our audit objective. 

Results in Brief 

Our comparison of likely State Department costs versus contractor costs for four 

task orders and one contract awarded by the State Department for security services 

in Iraq showed that for three of the task orders and the contract, the cost of using 

State Department employees would be greater than using contractors, while the State 

Department’s estimated cost to use federal employees was less for the other task 

order. For example, using State Department employees to provide static security for 

the embassy in Baghdad would have cost the department approximately $858 million 

for 1 year compared to the approximately $78 million charged by the contractor for 

the same time period. In contrast, our cost comparison of the task order for providing 

personal security for State Department employees while in the Baghdad region—

which required personnel that have security clearances—showed that for this task 

order, the State Department’s estimated annual cost would have been about $240 

million, whereas the contractor charged approximately $380 million for 1 year. 

However, because the State Department does not currently have a sufficient number 

of trained personnel to provide security in Iraq, the department would need to recruit, 

hire, and train additional employees at an additional cost of $162 million. Contract 

requirements are a major factor in determining whether contractors or government 

personnel are less expensive—especially factors such as whether personnel need 

security clearances. However, there are other factors that may play a role in the 

decision of whether to perform security services with federal employees or 

Page 3 GAO-10-266R, Warfighter Support 
contractors. For example, it generally takes more time to recruit, hire, and train 

enough federal employees than to acquire contractors. Additionally, the government 

could potentially be faced with incurring some administrative costs from having to 

take actions to reduce government personnel if they are no longer needed. When 

using contractors, the department also incurs administrative costs for awarding the 

task orders and contract and providing oversight; however, the State Department was 

unable to estimate these costs. Finally, some costs associated with providing Iraq 

security services using federal employees—such as developing new career fields, 

providing additional overhead, and building new housing—are difficult to quantify. 

Background 

The State Department—under the authority of the Secretary of State—is responsible 

for the security of most U.S. civilian agency personnel and agency contractors on 

official duty overseas. Its Bureau of Diplomatic Security (Bureau) is a unique 

organization that plays an essential role within the department. The Bureau’s 

personnel work together as a team to ensure that the State Department can carry out 

its foreign policy missions safely and securely around the world. The Bureau of 

Diplomatic Security has a broad scope of global responsibilities, with protection of 

people, information, and property as its top priority. Overseas, the Bureau develops 

and implements security programs to safeguard all personnel who work in every U.S. 

diplomatic mission around the world. Over the years, the State Department has been 

unable to provide long-term personal protective services solely from its pool of 

special agents and it has turned to contractual support. Private security contractors 

provide a number of security-related functions such as: 

• personal security: the protective security for high-ranking U.S. government 

officials and U.S. federal civilian personnel, and other individuals traveling in 

unsecured areas; 

• convoy security: the protection of convoys traveling in unsecured areas; and 

• static security: the protection of fixed or static sites, such as military bases, 

housing areas, and reconstruction work sites. 

In June 2005, the State Department awarded a Worldwide Personal Protective 

Services II contract to three contractors.8

 For the purposes of this review, we focused 

on four task orders associated with this contract which are for security services in 

Iraq. The four separate task orders—with a 1-year base period and four 1-year 

options—were awarded to the contractors to provide personal protective services in 

four regions9

 of Iraq and for static guard services at the Baghdad WPPS camp. We 

also examined the Baghdad Embassy Security Forces contract awarded in 2005, 

which provides 24-hour security of the embassy and its personnel while on the 

embassy grounds. 

 

8

 In March 2000, the State Department awarded the first WPPS contract to provide protective services 

in areas of the former Yugoslavia, the Palestinian Territories (July 2002), and Afghanistan (November 

2002). In 2004, task orders under the WPPS contract were issued to provide personal protective 

services in Iraq. 

9

 The regions were Baghdad, Basrah, Al-Hillah, and Erbil. Four additional task orders provided security 

services in Jerusalem, Haiti, Kabul, and Bosnia and another task order provided aerial security support 

in Iraq, which we did not include in our review. 

Page 4 GAO-10-266R, Warfighter Support 
Using Contractors in Iraq Is Less Costly than the Estimated Cost for Using 

State Department Employees for Four of the Five Cases We Reviewed 

Our comparison of likely State Department costs versus contractor costs for four 

task orders and one contract awarded by the State Department for security services 

in Iraq showed that for three of the task orders and the contract, the cost of using 

State Department employees would be greater than using contractors, while the State 

Department’s estimated cost to use federal employees was less for the other task 

order. For the remaining task order related to providing protective services in the 

Baghdad region, the State Department’s estimated annual cost would have been 

about $141 million less than the contractor’s cost. Overall, the difference between the 

contractors’ cost and the estimated State Department cost ranged from about $3 

million for one task order to over $785 million for the contract. For example, using 

State Department employees to provide static security for the embassy in Baghdad 

would have cost the department approximately $858 million for 1 year compared to 

the approximately $78 million charged by the contractor for the same time period. 

Although the State Department had not performed a cost comparison for security 

services, for our cost comparison, the State Department said it would use 100 percent 

U.S. citizen employees10 and would use the same number of personnel the contractor 

provided to perform the services as a start point for the comparison. However, 

because the State Department lacks a sufficient number of personnel to provide 

security in Iraq it would need to hire thousands of new security personnel. 

Furthermore, under State’s rotation policy, U.S. citizen employees typically only 

serve 1 year in Iraq and then are reassigned to a position in the United States. As 

such, in order to provide more than 1 year of deployed security services, State 

Department officials stated they would need to hire additional employees to meet a 

one-to-one ratio of stateside and deployed employees, which will double some of 

State’s estimated costs to provide security services. These additional employees 

would need to be hired about 1 year prior to being deployed to allow sufficient time 

for completing the State Department’s training program for Foreign Service agents, 

which is approximately 1 year.11 The costs to recruit, hire, and train new security 

personnel are not included in the State Department’s cost in table 1; however, these 

 

10 According to State Department officials, they would be reluctant to hire third-country foreign 

nationals to provide security in Iraq because the department does not want to be perceived as hiring 

mercenaries. Additionally, because of security concerns they would be reluctant to hire local nationals 

to provide security. 

11 Training for Diplomatic Security Special Agents (who are federal law enforcement personnel) 

includes 12 weeks of training at the Federal Law Enforcement Training Center and 13 weeks of 

training provided by the Bureau of Diplomatic Security which includes driver and firearms training, 

interrogation techniques, emergency medical training, and training on protective security operations. 

Additionally, in preparation for their initial overseas assignment, all Diplomatic Security Special 

Agents attend the 12-week Basic Regional Security Officer Course. The focus of this training is largely 

on management of Diplomatic Security programs and security operations overseas and includes 

training in emergency action planning, detecting passport fraud, counterintelligence investigations, 

and international parental child abductions. Also, an additional 7-week High Threat Tactical Training 

course is required for those assigned to high-threat posts, such as Iraq and Afghanistan. This course 

provides training on advanced protective security operations, close quarters battle, small unit tactics, 

and the management and leadership of protective operations.

The State Department requires its contractors provide 164 hours of training to its employees. The 

training curriculum is approved by the Department of State and teaches basic personal protective 

security for a high-threat environment including organization of personal protective service details, 

motorcade operations, protective security route and site advances, radio procedures, emergency 

medical training, defensive tactics, and driver training, etc. 

Page 5 GAO-10-266R, Warfighter Support 
costs are detailed in table 3. Table 1 shows our cost comparison for one contract and 

four task orders using a one-to-one ratio of deployed to stateside employees. 

Table 1: State Department versus Private Security Contractor Cost Comparison ($ in 

millions) 

Contract / task 

orders 

Number of 

contractor 

personnel 

Contractora

annual cost 

State Department annual 

estimated costb

 (in fiscal year 

2008 dollars) 

Cost 

difference 

Deployed Stateside Total

Baghdad Embassy 

Static Security 1,982 $77.6 $681.9 $176.5 $858.4 ($785.1)

Baghdad Region 

Personal Protective 

Services Task Order 553 $380.4 $190.3 $49.2 $239.5 $140.9 

Basrah Region 

Personal Protective 

Services Task Order 243 $61.6 $83.6 $21.6 $105.2 ($43.7)

Al-Hillah Region 

Personal Protective 

Services Task Order 259 $71.9 $89.1 $23.1 $112.2 ($40.3)

Erbil Region 

Personal Protective 

Services Task Order 128 $52.1 $44.0 $11.4 $55.4 ($3.3)

Source: GAO analysis of State Department data. 

a

The contractor annual costs have been converted into fiscal year 2008 dollars. 

b

The costs to recruit, hire, and train new employees are not included because the State 

Department would incur costs to acquire new employees before it would incur the additional 

estimated annual costs in this table. 

In addition to the actual cost of the contract and task orders, the State Department 

would also incur some administrative costs associated with using contractors such as 

the costs of awarding the task orders and contract and providing oversight. The State 

Department was unable to provide an estimated cost for the awarding and oversight 

of contracts. These costs can vary depending on the complexity and sensitivity of the 

contract. For example, according to State Department officials, the Baghdad 

Embassy contract provides static security at a fixed site which requires less oversight 

than the Worldwide Personal Protective Services II contracts which provide for the 

protective security of U.S. government officials and other individuals traveling in 

unsecured areas in theatre. As we noted in July 2008,12 the State Department took 

steps in Iraq to provide increased oversight for the Worldwide Personal Protective 

Services II contract after the Nisour Square incident.13 For example, the department 

added 45 special agent positions—allowing a Diplomatic Security agent to 

accompany most protection movements—and installed cameras and video equipment 

in security vehicles for improved oversight of security contractors. 

 

12 Rebuilding Iraq: DOD and State Department Have Improved Oversight and Coordination of 

Private Security Contractors in Iraq, But Further Actions are Needed to Sustain Improvements, 

GAO-08-966 (Washington, D.C.: July 2008). 

13 On September 16, 2007, at Nisour Square, contractor employees protecting a diplomatic convoy 

allegedly fired upon and killed 17 Iraqis.

Page 6 GAO-10-266R, Warfighter Support 
Costs to Deploy and Sustain Federal Employees Overseas Account for Over One-Half 

of the State Department’s Estimated Costs

Our analysis showed that over one-half of the State Department’s estimated costs for 

deployed employees were to cover costs required to sustain the employees overseas. 

The State Department’s estimated cost to provide security included components such 

as salaries, benefits, cost of living allowances and overtime, overseas costs, and other 

support costs associated with deploying and sustaining U.S. citizen employees 

overseas. Overseas costs included things such as furniture, furnishings and 

equipment for office spaces and residences, maintenance and repair of living 

quarters, and travel cost for rest and relaxation for deployed personnel. Estimated 

costs for State Department employees were calculated by multiplying the State 

Department’s average annual cost for two middle grade Foreign Service agents, one 

to be deployed and one to be stateside for rotation purposes by the number of 

personnel needed to perform the mission. As shown in table 2, almost 55 percent of 

the State Department’s deployed employee cost was for overseas related costs, while 

salaries, benefits, and overtime/cost of living allowances/awards accounted for about 

37 percent. Salaries and benefits accounted for all of State Department’s estimated 

stateside employee costs. 

Table 2: State Department’s per Person Cost Componentsa 

Cost component Deployed employee Stateside employee Total 

 Cost Percentage Cost Percentage Cost Percentage 

Salary $65,000 18.9% $65,000 73.0% $130,000 30.0% 

Benefitsb $24,050 7.0% $24,050 27.0% $48,100 11.1% 

Overtime/cost of 

living allowances

/differential/awardsc $38,000 11.0% $0 0.0% $38,000 8.8% 

Overseas costs $189,000 54.9% $0 0.0% $189,000 43.6% 

Support $28,000 8.1% $0 0.0% $28,000 6.5% 

Total $344,050 100% $89,050 100% $433,100 100%

Source: GAO analysis of State Department data. 

a

Approximate contractor cost per person was $39,000 for the Baghdad Embassy Static Security 

contract; $688,000 for the Baghdad Region Personal protective Services Task Order; $253,000 

for the Basrah Region Personal Protective Services Task Order; $278,000 for the Al-Hillah 

Region Personal Protective Services Task Order; and $407,000 for the Erbil Region Personal 

Protective Services Task Order. 

b

About 37 percent of salary, according to the State Department. 

c

Cost of living allowance. 

The State Department Would Incur Costs to Hire the Number of Personnel Needed to 

Provide Security Services

In order for the State Department to perform these security missions with its own 

employees, as shown in table 3, it would cost the State Department approximately 

$162 million to recruit, hire, and train 6,330 employees. When determining total costs 

for the department to provide security services, these recruitment and training costs 

would be in addition to the State Department’s estimated annual cost. Overall, for 

these four task orders and one contract, the State Department is using 3,165 

contractors for security in Iraq. However, the State Department only has about 1,500 

security agents who are already performing other missions and according to State 

Department officials, these agents would not be available to perform the security 

missions provided by the contractors. According to State Department officials, based 

Page 7 GAO-10-266R, Warfighter Support 
upon recent experience in establishing a new skill specialty, it would take about a 

year to have the first security personnel on-board; however, they would not be in 

sufficient numbers to completely replace the contractors. They said it could easily 

take them 3 years or longer to hire, train, and fully staff all positions necessary to 

accomplish the mission. As an example of the length of time it would take to hire and 

mobilize more employees, State Department officials informed us that after the 

attacks on September 11, 2001, under their current hiring process it took the State 

Department 2 years to hire 327 employees using existing career fields (to include 

recruitment, training, and completing the security clearance process). 

Table 3: State Department Estimated Cost to Recruit, Hire, and Train Employees 

Cost component Cost per person Number of people Total ($ millions)

Recruiting $6,575 6,330 $41.6 

Training $15,000 6,330 $95.0 

Background investigations $4,000 6,330 $25.3 

Total $25,575 6,330 $161.9

Source: GAO analysis of State Department data. 

In response to the Nisour Square incident of September 2007 the State Department 

recently created a new Security Specialist series to serve up to 5 consecutive years in 

deployed locations to accompany contractor personnel performing security missions. 

State Department officials said that hiring employees under this series could be an 

option for providing security services in Iraq; however, given their recent experience 

with filling these positions and the number of employees that would be needed, it 

could be several years before enough employees were hired and trained to perform 

the security mission, as such, making this an unlikely option. On February 9, 2009, the 

State Department issued vacancy announcements for Security Protective Specialist 

and Supervisory Security Protective Specialist positions, which were open until 

February 17, 2009. As stated in the vacancy announcement, the initial appointment 

would be for 13 months and may be renewed annually up to 5 years, and the 

appointment may be terminated by the government at any time upon at least 30 days 

notice.14 According to the State Department, the open period was limited to 9 days in 

an effort to meet senior management's goal to get the individuals hired, trained, and 

on the ground by the end of summer. Based on their past experience with the Special 

Agent announcements, the department assumed that the 9-day open period would 

provide them with more than enough candidates to fill the 25 positions. According to 

the State Department, while a total of 586 applications were received, after analyses 

and screening only 92 were found to meet the basic qualifications and 10 have been 

hired to go to Afghanistan. Nine additional candidates have been cleared for 

employment or are in the hiring process. Based on the department’s experience with 

the first announcement and feedback from the candidates, the State Department 

revamped the vacancy announcements to highlight some of the key benefits of the 

program, such as rest and relaxation travel, separate maintenance allowance, danger 

 

14 This would provide the State Department flexibility similar to what it has with contractors. However, 

the State Department would incur other costs such as providing federal employee health insurance, 

federal employee retirement, and life insurance. 

Page 8 GAO-10-266R, Warfighter Support 
pay, and post differential.15 In addition, the department amended the experience 

requirement to more accurately reflect the minimum level of specialized experience 

required to qualify for the positions. On September 9, 2009, the department opened 

the revamped vacancy announcements for these positions for 30 days. According to 

the State Department, a total of 993 applications were received; analyses and 

screening of the applications began immediately after the announcements closed and 

interviews will be scheduled with those candidates found to meet the basic 

qualifications. State Department officials said they would not need to hire additional 

personnel stateside for rotation of these personnel and this may be an option for 

providing the security services; however, they said it could take a significant amount 

of time to fill enough positions needed to provide the security services. To acquire 

these employees, the State Department would incur a minimum cost of 

approximately $81 million for recruiting, hiring, and training 3,165 employees and an 

additional cost of over $5 billion—over 5 years—for other costs such as salaries, 

benefits, awards, overseas costs, and cost of living allowances. For example, for the 

Baghdad Embassy Security Forces contract, State Department’s estimated cost to 

recruit, hire, and train 1,982 employees in this series would be about $51 million and 

the deployment cost for these employees for 5 years is over $3 billion. The 

contractor’s total cost for the Baghdad Embassy Security Forces contract was 

approximately $356 million. The State Department’s cost estimates do not include the 

cost of developing new career fields, as discussed below. Assuming the State 

Department had enough of these term employees to meet the protective security 

requirements and using the quantifiable estimated cost, based on our analysis, it 

would be less costly for the State Department to perform the security mission for two 

of the four task orders we reviewed. 

Contract Requirements Can Influence the Cost of Security Services

Contract requirements are a major factor in determining whether contractors or 

government personnel are less expensive—especially factors such as whether 

personnel need security clearances. For instance, unless the State Department 

specifies a need for personnel with security clearances—which are generally not 

available to non-U.S. citizens—contractors typically choose to employ a large 

percentage of third-country nationals and local nationals to lower contract cost. For 

example, the contractor providing embassy security in Baghdad employed a large 

percentage of third-country nationals and local nationals (about 89 percent), whose 

lower wages contributed to the lower cost of the contract. In contrast, our 

comparison of the task order for providing personal security for State Department 

employees while in the Baghdad region—which required personnel that have security 

clearances—showed that for this task order, the State Department’s estimated annual 

cost would have been about $240 million, whereas the contractor charged 

approximately $380 million for 1 year. Table 4 shows the breakdown of the 

contractor workforce for the contract and four task orders we reviewed. 

 

15 Post differential provides additional compensation to employees for service in foreign areas where 

environmental conditions differ substantially from environmental conditions in the continental United 

States and warrant additional pay as a recruitment and retention incentive. 

Page 9 GAO-10-266R, Warfighter Support 
Table 4: Nationality of Contractor Workforce 

Contract/task 

orders 

Total 

contract / 

task order 

personnel 

U.S. 

citizens 

Third-country 

nationals 

Local nationals 

Number Percent Number Percent Number Percent 

Baghdad Embassy 

Static Security 

1,982 166 8% 1,623 82% 148 7% 

Baghdad Region 

Personal Protective 

Services Task Order 

553 553 100% 0 0 0 0 

Basrah Region 

Personal Protective 

Services Task Order 

243 116 48% 127 52% 0 0 

Al-Hillah Region 

Personal Protective 

Services Task Order 

259 118 46% 141 54% 0 0 

Erbil Region 

Personal Protective 

Services Task Order 

128 102 80% 18 14% 8 6% 

Total 3,165 1,055 33% 1,909 60% 156 5%

Source: GAO analysis of State Department data. 

 For the Baghdad Embassy Security Force contract for static security, State 

Department’s estimated annual cost would be over $785 million more than the 

contractor’s cost if the decision was made to have the State Department 

provide these services rather than using a contractor. The State Department 

awarded the contract to provide 24-hour deterrent against unauthorized, 

illegal, or potentially life-threatening activities directed toward the embassy’s 

employees, visitors, sensitive information, and properties. Under this contract, 

the contractor was required to recruit, train, and manage the armed 

professional security personnel and the supervisory employees utilized in this 

effort. The contractor used 1,982 personnel at a cost of about $78 million. State 

Department’s estimated cost was about $858 million ($682 million for 

deployed employees and $176 million for stateside employees to replace the 

deployed personnel at the end of 1 year). The contractor used 8 percent U.S. 

citizen employees, 82 percent third-country nationals, and 7 percent local 

nationals. 

 The contractor’s cost for the Basrah region task order was less than the State 

Department’s estimated cost. The State Department’s estimated cost to 

provide the security services would be approximately $44 million more than 

the contractor’s cost if a decision were made to have the State Department 

provide the service rather than using a contractor. The contractor provided 

protective security and used 243 personnel at a cost of approximately $62 

million, whereas the State Department’s estimated cost would be about $105 

million ($83 million for deployed personnel and $22 million for stateside 

employees to replace the deployed employees). For this task order, the 

contractor used 48 percent U.S. citizen employees and 52 percent thirdcountry nationals. 

Page 10 GAO-10-266R, Warfighter Support 
 The contractor’s cost for security in the Al-Hillah region was less than the 

State Department’s estimated cost for proving the security using federal 

employees. The contractor’s cost was approximately $40 million less than the 

State Department’s estimated cost. The contractor provided protective 

security using 259 personnel at a cost of approximately $72 million. The State 

Department’s estimated cost for the same services was $112 million ($89 

million for deployed personnel and $23 million for stateside employees to 

replace the deployed personnel). The contractor used 46 percent U.S. citizen 

employees and 54 percent third-country national employees. 

 The contractor’s cost for security in the Erbil region was also approximately 

$3 million less than the State Department’s estimated cost for providing the 

service with federal employees. The contractor provided security services 

using 128 personnel at a cost of approximately $52 million. The State 

Department’s estimate to perform the same security would be approximately 

$55 million ($44 million for deployed personnel and $11 million for stateside 

employees to replace the deployed personnel.) The nationality of the 

contractor’s workforce was 80 percent U.S. citizen employees, 14 percent 

third-country nationals, and 6 percent local national employees. 

There are other factors that may play a role in the decision of whether to perform 

security services with federal employees or contractors. For example, it generally 

takes more time to hire and train enough federal employees than to acquire 

contractors. Additionally, the government could potentially be faced with having to 

take actions to reduce the number of government personnel hired if they are no 

longer needed. In contrast, if the need for the contract no longer existed, the 

government could terminate the contract. 

Some Costs Associated with Providing Iraq Security Services with Federal Employees 

Are Difficult to Quantify

Some costs associated with providing Iraq security services using federal 

employees—such as developing new career fields, providing additional overhead, and 

building new housing—are difficult to quantify. State Department officials said they 

do not have personnel with some of the skills required to provide security, such as 

guards, screeners, explosive ordnance detection dog handlers, or armorers. Both 

overseas and domestically, these services are currently provided by contractors. 

Therefore, the State Department would incur costs for developing new career fields 

for these positions. For example, the department would incur the cost for developing 

a new training curriculum for each of these positions as well as the cost for training 

facilities and equipment. 

A significant increase in the number of State Department diplomatic security 

personnel would require more administration and oversight from the department 

because of the increased number of employees to support and supervise. According 

to State Department officials, if they used State Department employees to provide the 

security services in Iraq, they would have to build new housing at the embassy for 

these employees. The officials said that Foreign Service agents are not allowed to live 

with contractors and the housing currently used by the contractors at the embassy 

would not be sufficient for the agents. Additionally, the officials stated that currently 

Page 11 GAO-10-266R, Warfighter Support 
there is not enough space on the embassy compound for additional housing. As such, 

there could be an additional cost for more space—if available—to build housing. 

Although the State Department recognizes it would incur additional cost for these 

components, the department was unable to quantify these costs. 

Agency Comments and Our Evaluation 

We provided both the State Department and DOD with a draft of this report and 

requested that they provide comments. Both the State Department and DOD advised 

us that they had no comments on the report. The State Department and DOD 

provided technical comments which were incorporated as appropriate. 

____________ 

We are sending copies of this report to the Secretary of Defense, the Secretary of 

State, and the appropriate congressional committees. In addition, the report will be 

available at no charge on the GAO Web site at http://www.gao.gov. 

If you or your staffs have any questions about this report, please contact me at (202) 

512-7686 or solisw@gao.gov. Contact points for our Offices of Congressional 

Relations and Public Affairs may be found on the last page of this report. Key 

contributors to this report were Carole F. Coffey, Assistant Director; Charles W. 

Perdue, Assistant Director, Applied Research and Methods; Connie W. Sawyer, Jr.; 

Clarine S. Allen; Alyssa B. Weir; and Chaneé L. Gaskin. 

William M. Solis 

Director, Defense Capabilities and Management 

Page 12 GAO-10-266R, Warfighter Support 
List of Committees

The Honorable Carl Levin 

Chairman 

The Honorable John McCain 

Ranking Member 

Committee on Armed Services 

United States Senate 

The Honorable John F. Kerry 

Chairman 

The Honorable Richard G. Lugar 

Ranking Member 

Committee on Foreign Relations 

United States Senate 

The Honorable Daniel K. Inouye 

Chairman 

The Honorable Thad Cochran 

Ranking Member 

Subcommittee on Defense 

Committee on Appropriations 

United States Senate 

The Honorable Patrick Leahy 

Chairman 

The Honorable Judd Gregg 

Ranking Member 

Subcommittee on State, Foreign Operations, and Related Programs 

Committee on Appropriations 

United States Senate 

The Honorable Claire McCaskill 

Chairman 

The Honorable Robert F Bennett 

Ranking Member 

Ad Hoc Subcommittee on Contracting Oversight 

Committee on Homeland Security and Governmental Affairs 

United States Senate 

The Honorable Norm Dicks 

Acting Chairman 

The Honorable C.W. “Bill” Young 

Ranking Member 

Subcommittee on Defense 

Committee on Appropriations 

House of Representatives 

Page 13 GAO-10-266R, Warfighter Support 
The Honorable Nita Lowey 

Chairman 

The Honorable Kay Granger 

 Ranking Member 

Subcommittee on State, Foreign Operations, and Related Programs 

Committee on Appropriations 

House of Representatives 

The Honorable Ike Skelton 

Chairman 

The Honorable Howard P. “Buck” McKeon 

Ranking Member 

Committee on Armed Services 

House of Representatives 

The Honorable Howard L. Berman 

Chairman 

The Honorable Ileana Ros-Lehtinen 

Ranking Member 

Committee on Foreign Affairs 

House of Representatives 

The Honorable Tom Coburn 

United States Senate 

Page 14 GAO-10-266R, Warfighter Support 
Appendix I 

Scope and Methodology 

To address our objective, we reviewed the task orders and contract which provided 

security in Iraq and were current when we began our review—four task orders of the 

Worldwide Personal Protective Services II contracts and one contract for Baghdad 

embassy security. We reviewed and analyzed relevant documents—including 

performance statements of work and contract modifications—to identify the cost and 

services provided under each task order and contract. One task order was awarded to 

one of the three Worldwide Personal Protective Services (WPPS) II contractors to 

provide personal protective services in Baghdad and Ramadi and for static guard 

services at the Baghdad WPPS camp. This task order was awarded for a 1-year base 

period from May 8, 2006, to May 7, 2007, and four 1-year options. The three other task 

orders were awarded to the three contractors to provide protective security services 

in different locations in Iraq for a 1-year base period from August 5, 2006, to August 4, 

2007, and four 1-year options. One contractor was responsible for the Basrah region, 

another for the Al-Hillah region and the other was responsible for the Erbil region.16

We also reviewed the Baghdad Embassy Security Forces contract which was 

awarded to the contractor performing security in the Basrah region. The contractor 

was to provide a 24-hour deterrent against unauthorized, illegal, or potentially lifethreatening activities directed toward the embassy’s employees, visitors, sensitive 

information, and properties. Also, the contractor was required to recruit, train, and 

manage the armed professional security personnel and the supervisory employees 

utilized in this effort. We discussed with State Department officials their roles and 

responsibilities related to security contracts that support the department’s missions 

in Iraq. We asked the officials to identify the various cost components within the task 

orders and contract and to provide specific task order and contract information, 

including cost and the number of contractor personnel. We also asked if they had 

performed any cost comparisons related to providing similar security services as the 

contractors. Although the State Department had not performed a cost comparison for 

security services, for our cost comparison, the State Department’s assumptions 

included (1) the State Department would have to recruit, hire, and train new 

employees who would all be U.S. citizens; (2) the employees would serve 1 year in 

Iraq and then return to the United States; and (3) the State Department would use the 

same number of employees the contractors use to provide security. We asked 

officials to provide us with their annual estimated per person costs to perform 

security services in deployed locations. The officials pulled information from the 

department’s accounting system and provided us with the average annual cost—by 

various components—for current Foreign Service agents providing security services 

in deployed locations. The State Department’s estimated cost to provide security 

included components such as salaries, benefits, cost of living allowances and 

overtime, overseas cost, recruitment, training, and other support costs. For our cost 

comparison of contractor cost versus State Department estimated annual cost, we 

focused our analysis on major quantifiable cost components such as salary, benefits, 

overseas costs, and support. We also computed additional cost to recruit, hire, and 

train new security employees. 

 

16 Task orders 2-5 provide security services in Jerusalem, Haiti, Kabul, and Bosnia, respectively, while 

task order 10 provides aerial security support in Iraq, which we did not include in our review. 

Page 15 GAO-10-266R, Warfighter Support 
The State Department provided the number of contractor personnel performing the 

security missions for each task order and contract in Iraq and said this would be the 

number of personnel they would need to perform the mission. To determine the total 

average annual cost for the department, we multiplied the number of personnel by 

the average per person cost for a deployed State Department Foreign Service agent. 

Given the State Department’s rotation policy, we added additional costs for stateside 

agents to replace the deployed agents. We compared the obligated amounts for the 

four task orders and one security contract to the total costs that the State 

Department said it would likely incur if the department were to provide the 

services—based on the previously discussed assumptions. The costs that the State 

Department provided were in fiscal year 2008 dollars and the costs of the four task 

orders and the security contract were for earlier time periods. In order to make 

similar comparison, we converted the private security costs into fiscal year 2008 

dollars so that they could be compared to the fiscal year 2008 costs of the State 

Department. 

We identified other cost components which impact the total cost of the State 

Department providing security services, such as creating new career fields, cost of 

additional overhead, and cost for building new housing. However, these cost 

components were not easily quantifiable because the department was unable to 

estimate the future long-term costs of these components. As such we were unable to 

include these costs in our review. 

To understand contractor cost components, we reviewed and analyzed the Iraq 

contract and task orders to obtain the cost for services provided under each contract 

and task order and we held discussions with one of the private security contractors 

to better understand their cost for providing private security services, as well as the 

different cost components included in their contract. Some of the major cost 

components identified by the contractor include labor, training, life support (housing, 

laundry, meals), basic individual items (uniforms, body armor, boots), mobilization, 

rotation travel (for rest & relaxation), weapons & ammunition, vehicle & 

transportation (armored/unarmored vehicles), equipment transport costs (shipment 

of basic individual items), direct insurance costs, and other equipment (medical 

supplies, radios/communications, internet access, night vision goggles, 

security/surveillance equipment). According to the contractor, these cost 

components are the primary cost drivers in their offer to the government when 

submitting a proposal. 

We did not evaluate the quality of the services provided by the contractors or 

whether better services could be provided by the State Department. We also did not 

evaluate the policy implications of using contractors to perform security functions. In 

addition, we did not include the cost of government-furnished equipment provided to 

the contractor because we believe similar equipment would be needed if the 

government provided the services. 

Page 16 GAO-10-266R, Warfighter Support 
We conducted our review from October 2008 through October 2009 in accordance 

with generally accepted government auditing standards. Those standards require that 

we plan and perform the audit to obtain sufficient, appropriate evidence to provide a 

reasonable basis for our findings based on our audit objectives. We believe that the 

evidence obtained provides a reasonable basis for our findings based on our audit 

objective. 

Page 17 GAO-10-266R, Warfighter Support 
Page 18 GAO-10-266R, Warfighter Support 

Related GAO Products 

Contingency Contract Management: DOD Needs to Develop and Finalize 

Background Screening and Other Standards for Private Security Contractors. GAO09-351. Washington, D.C.: July 31, 2009. 

Rebuilding Iraq: DOD and State Department Have Improved Oversight and 

Coordination of Private Security Contractors in Iraq, But Further Actions are 

Needed to Sustain Improvements. GAO-08-966. Washington, D.C.: July 31, 2008. 

 

Defense Contracting: Army Case Study Delineates Concerns with the Use of 

Contractors as Contract Specialists. GAO-08-360. Washington, D.C.: March 26, 2008.

Military Operations: Implementation of Existing Guidance and Other Actions 

Needed to Improve DOD’s Oversight and Management of Contractors in Future 

Operations. GAO-08-436T. Washington, D.C.: January 24, 2008. 

Military Personnel: DOD Needs to Establish a Strategy to Improve Transparency 

over Reserve and National Guard Compensation to Manage Significant Growth in 

Cost. GAO-07-828. Washington, D.C.: June 20, 2007. 

Rebuilding Iraq: Actions Still Needed to Improve the Use of Private Security 

Providers. GAO-06-865T. Washington, D.C.: June 13, 2006. 

Peacekeeping: Cost Comparison of Actual UN and Hypothetical U.S. Operations in 

Haiti. GAO-06-331. Washington, D.C.: February 21, 2006. 

Rebuilding Iraq: Actions Needed to Improve Use of Private Security Providers. 

GAO-05-737. Washington, D.C.: July 28, 2005. 

Military Personnel: DOD Needs to Improve the Transparency and Reassess the 

Reasonableness, Appropriateness, Affordability, and Sustainability of Its Military 

Compensation System. GAO-05-798. Washington, D.C.: July 19, 2005. 

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