USA — Budget Slows Defense Growth, Comptroller Says

WASHINGTON, March 30, 2011 — Cost sav­ings reflect­ed in the fis­cal 2012 Defense Depart­ment bud­get do not rep­re­sent a cut from cur­rent fund­ing lev­els, but rather a slow­er rate of growth than has been seen in recent years, the Pentagon’s comp­trol­ler and chief finan­cial offi­cer told a Sen­ate com­mit­tee yes­ter­day.
Defense offi­cials have iden­ti­fied $178 bil­lion in sav­ings for fis­cal 2012 through 2016, Robert F. Hale, appear­ing along with bud­get rep­re­sen­ta­tives from the ser­vices, told the Sen­ate Armed Ser­vices Committee’s sub­com­mit­tee on readi­ness.

With a focus on improv­ing busi­ness oper­a­tions, defense offi­cials iden­ti­fied $100 bil­lion in sav­ings to be rein­vest­ed for com­bat capa­bil­i­ties, and took $78 bil­lion in sav­ings from the department’s top line to help in reduc­ing the fed­er­al deficit, Hale said. 

“Like Con­gress, the lead­er­ship of the Depart­ment of Defense is mind­ful of the fact that our nation is deal­ing with sig­nif­i­cant fis­cal and eco­nom­ic pres­sures,” he said. “Those pres­sures have a direct impact on the strength of our nation­al defense. We owe it to the tax­pay­ers to make the most of every dol­lar they entrust to us for the defense of the Unit­ed States.” 

In that spir­it, Hale said, the department’s bud­get requests for fis­cal 2010 and 2011 includ­ed steps to cur­tail or elim­i­nate pro­grams “where we had met our pro­cure­ment needs, or where pro­grams were seri­ous­ly trou­bled or pro­vid­ed capa­bil­i­ties that were judged too nar­row to jus­ti­fy their expense.” As part of the past two years’ bud­get process­es, more than 20 pro­grams were restruc­tured or elim­i­nat­ed, includ­ing those for the F‑22 and C‑17 air­craft, the new VH-71 pres­i­den­tial heli­copter, the Navy’s DDG-1000 ship pro­gram, and the Army’s Future Com­bat Sys­tem, Hale said. 

The main pur­pose for that restruc­tur­ing was to rebal­ance the mil­i­tary over the long term by rein­vest­ing in com­bat capa­bil­i­ties and force struc­ture, he said, but it also saved hun­dreds of bil­lions of tax­pay­er dollars. 

To shed excess over­head costs, the defense bud­get slows the growth of med­ical costs, which have sky­rock­et­ed from $19 bil­lion in fis­cal 2001 to $52 bil­lion antic­i­pat­ed for fis­cal 2012, by pro­mot­ing the use of gener­ic drugs and mail-order phar­ma­cies, and adding mod­est increas­es to TRICARE health plan enroll­ment fees for work­ing-age mil­i­tary retirees. The bud­get also saves $2.5 bil­lion in the next fis­cal year by plac­ing a freeze on civil­ian work­force lev­els that Hale esti­mat­ed would save $13 bil­lion over the next four years. The bud­get reflects a $2 bil­lion sav­ings from clos­ing U.S. Joint Forces Com­mand, and $337 mil­lion by clos­ing the Busi­ness Trans­for­ma­tion Agency. 

Hale also not­ed a pro­ject­ed $4 bil­lion sav­ings by restruc­tur­ing the joint strike fight­er pro­gram and $6 bil­lion by reduc­ing the end strength of the Army and Marine Corps. That reduced end strength, he added, is a reduc­tion from a plus-up Defense Sec­re­tary Robert M. Gates ordered four years ago when the Army gained 65,000 troops and the Marine Corps gained 27,000 to match demands in Iraq and Afghanistan. The bud­get calls for reduc­ing the Army by 27,000 and the Marine Corps by 15,000 in fis­cal 2015 and 2016. 

As part of Gates’ effi­cien­cies ini­tia­tive, the ser­vices have iden­ti­fied $100 bil­lion in sav­ings to be rein­vest­ed in high­er-pri­or­i­ty capa­bil­i­ties, Hale said. Under those sav­ings and rein­vest­ment plans: 

— The Army iden­ti­fied $29.5 bil­lion in sav­ings over four years by con­sol­i­dat­ing six Instal­la­tion Man­age­ment Com­mand regions into four, clos­ing the Eval­u­a­tion Task Force at Fort Bliss, Texas, reduc­ing con­struc­tion projects, and ter­mi­nat­ing the SLAMRAAM sur­face-to-air mis­sile pro­gram. The Army plans to rein­vest the sav­ings by mod­ern­iz­ing its fleet of Abrams tanks, Bradley fight­ing vehi­cles and Stryk­er wheeled vehi­cles; accel­er­at­ing the field­ing of a new tac­ti­cal com­mu­ni­ca­tions net­work; acquir­ing more unmanned aer­i­al vehi­cles; and increased fund­ing for sui­cide pre­ven­tion and men­tal health counseling. 

— The Navy iden­ti­fied $35 bil­lion in sav­ings over four years by elim­i­nat­ing select­ed squadron staffs for sub­marines, patrol air­craft and destroy­er squadrons; dis­es­tab­lish­ing 2nd Fleet in Nor­folk, Va.; and ter­mi­nat­ing the Marine Corps’ expe­di­tionary fight­ing vehi­cle pro­gram. The Navy plans to use the sav­ings to acquire six more ships than it had planned; to acquire 41 addi­tion­al F/A‑18 air­craft and add ser­vice exten­sions to 150 more; and to add sup­port to the Marine Corps’ amphibi­ous assault mission. 

— The Air Force has iden­ti­fied $33 bil­lion in sav­ings over four years by mak­ing orga­ni­za­tion­al changes in man­pow­er and per­son­nel and con­sol­i­dat­ing two air oper­a­tions cen­ters in the Unit­ed States and two in Europe, as well as con­sol­i­dat­ing three num­bered air force staffs in areas where major com­mands can assume the work­load. The Air Force plans to use the sav­ings to start a new long-range bomber pro­gram that can car­ry nuclear weapons and oper­ate either manned or unmanned. Also, the ser­vice plans to invest in more evolved expend­able launch vehi­cles, mod­ern radars for F‑15C and F‑15E air­craft; and more sim­u­la­tors for F‑35 training. 

U.S. Depart­ment of Defense
Office of the Assis­tant Sec­re­tary of Defense (Pub­lic Affairs) 

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