In reply to Elliot whether the USG has control over how contractors dispurse their funds, the answer in most cases is, “Yes, most definitely.” In cost plus contracts, there is actually a percentage amount for pay increases over the life of the award. This is usually the case for Time and Materials as well. However, this is not the case in Firm Fixed Price contracts. The govt is usually not supposed to know the innards of the cost structure for FFP.
Regardless, for contracts in place, there is no method for the USG to go back and retrofit a “do not give salary increases” clause. Unless I’m sorely mistaken, I really don’t see this as a possibility.
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