The Wall Street Journal

Consulting Firms Offer to Cut Up to $20 Billion From Federal Contracts

Booz Allen Hamilton, Guidehouse and others are negotiating with General Services Administration as part of broad review of government contractors

Booz Allen Hamilton generates nearly all its revenue from contracts tied to the U.S. government.
Booz Allen Hamilton generates nearly all its revenue from contracts tied to the U.S. government. Photo: Jason C. Andrew/Bloomberg News

Some of the biggest U.S. consulting firms have offered billions in additional cuts to their contracts after the Trump administration told firms that they needed to pony up deeper price concessions—or face consequences.

Seven of the 10 largest consulting firms to the government have now offered up to $20 billion in savings by proposing to either terminate existing contracts or reduce the scope of their work within federal agencies, according to a person familiar with the negotiations. Some firms are now proposing to offer credits toward their work or artificial-intelligence services free of charge.

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