On April 11, 2025, U.S. Defense Secretary Pete Hegseth ordered the termination of several information technology services and consulting contracts valued at $5.1 billion. These cuts directly impact firms including Booz Allen Hamilton, Accenture, and Deloitte.
Secretary Hegseth stated that these contracts represented 'non-essential spending on third party consultants' and that the services could be more efficiently carried out by Pentagon staff. The terminations are expected to result in nearly $4 billion in estimated savings for the government.
This move signals a significant shift in federal procurement strategy, with a focus on in-sourcing services previously provided by external consultants. For Booz Allen Hamilton, this represents a direct reduction in contract revenue and highlights increased policy risk from government spending reviews.
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