While agencies are currently facing reduced budgets, the Professional Services Council expects that trend will continue due to the potential exhaustion of Medicare and Social Security funding.

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Agency spending will be constrained for the next decade due to partisan stalemates in Congress and long-term budgetary issues, a trade association for federal contractors predicts.

The Professional Services Council’s Vision Federal Market Forecast — an annual initiative under its foundation through which more than 400 industry volunteers interviewed federal employees representing about 30 agencies as well as think tank experts and congressional staffers to anticipate federal budget priorities and challenges — expects that the government in the near term will experience a “legislative logjam.”

Under this scenario, the baseline for non-defense spending is at fiscal 2025 levels while defense appropriations would experience 2% annual growth. It also predicts continued use of impoundments and recissions, two administrative tools that the Trump administration has relied on as part of its goal to cut government spending.

Mike Reilly, a Vision volunteer, said during a  Nov. 24 press call previewing the industry forecast that a “legislative logjam” is “sort of what we’re experiencing now.”

The agreement to end the 43-day shutdown included full-year appropriations bills that cover the Agriculture and Veterans Affairs departments as well as the legislative branch. (The rest of the government is operating under a continuing resolution that will maintain current funding levels through Jan. 30.) In line with such a scenario, the three enacted spending measures, while mostly rejecting Trump’s proposed cuts, largely didn’t increase funding for government programs or only did so modestly.

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