They did a shoddy job, so the government pays them more to correct their shoddy work?
It sounds like you're talking about the type of contract where the contract doesn't specify a certain result, but only "best efforts." No obligation to succeed, just to try. "Shoddy" isn't appropriate, ever, but I don't suppose the private contractor actually admits that they did shoddy work, pay them anyway.
In cases where the government is asking the contractor to do something that's never been done before, what is the best way to allocate risk?
In private industry, it's ok to cut someone else's throat, although in practice it's rarely done because it's likely that there will be a continuing relationship.
In certain industries (defense industry is one), the government is the only customer, or by far the biggest customer, so cutting throats isn't useful in the long run.
Contracts, once awarded, may be modified if it's in the best interest of the government, and that is too complex to give a hard and fast rule about. |
