Government Contract Reform and Waste Prevention Act of 1985

Government Contract Reform and Waste Prevention Act of 1985 - Amends the Federal False Claims Act to make any person (including a member of the armed forces) liable to the United States for presenting a false claim or a claim for a defective or improperly tested product. Raises the civil penalty from $2,000 to $10,000.

Allows any person to proceed with a qui tam suit (a civil action initiated by an individual for himself as well as for the U.S. Government) if after evidence of the false claim is brought to the attention of the agency head, the agency fails to undertake corrective measures within six months.

Lowers the percentage of damages awarded to a person bringing suit against a false claimant to not less than one percent of the total proceeds of the action or the settlement of the claim (currently, ten percent where the Government proceeds with an action or 25 percent where the Government does not proceed). Permits a greater amount of compensation (up to $1,000,000) where fair and reasonable.