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Lawmakers on Thursday voiced concerns during a Senate Armed Services Readiness Subcommittee hearing that the military services have failed to make substantial changes in their business operations, leading to continued cost hikes and schedule delays on the Pentagon's expensive weapons systems.

The result is billions of dollars squandered every year that could be better spent on more pressing needs both for the military and elsewhere in the government, the senators said. "This is mundane stuff," said Senate Armed Services Readiness Subcommittee Chairman John Ensign, R-Nev. "This is not fighting wars."

But a failure to transform business operations, which makes warfighting more difficult, he added. Ensign was joined in his criticism of the services' business efforts by Government Accountability Office Comptroller General David Walker, who urged Congress to establish a chief operating officer in the Pentagon to keep program costs and schedules under control.

"That's not a panacea," Walker said. "But if we don't get it, I doubt we'll be successful."

Walker, one of the most vocal critics of the Defense Department's management of its weapons programs, also challenged the Pentagon to make a "Herculean effort" to devise a single, department-wide strategy to handle business operations and manage the $60 billion annually set aside for procurement.

Army, Navy and Air Force officials, meanwhile, touted their attempts to transform their business offices over the last year. However, they also acknowledged that more work must be done to boost financial oversight and accountability.

"Improving the Army's financial accountability and modernizing business systems are challenging endeavors, which require a long-term commitment to ensure that enduring improvements are implemented," John Argodale, deputy assistant secretary of the Army for financial operations, said in his prepared testimony.

But neither Ensign nor Armed Services Readiness Subcommittee ranking member Daniel Akaka, D-Hawaii, appeared satisfied with the testimony Thursday, largely because the service secretaries did not send higher-level officials to testify.

"We are not happy with this and we want you to convey to your bosses that we are not happy about this," Ensign said. "I am glad you are here, but we expected the higher level here," Akaka added.

COMMENTS

• The responder is right on point. And to further buttress his contentions, the unsavory and self-serving fact of the matter is that essentially throughout DOD's financial management community, quite literally from the top GS scale to the mid-GS range, there is a near universal hiring rate of 100 percent insular inbreeding. Inbreeding that results in intellectual stagnation, groupthink, a legacy of a debased go-along-to-get-along and overly insular organizational culture that breeds at best mediocrity, and at worst results in incompetence and malfeasance. Michael J. Smith Posted November 17, 2006 2:37 PM
• The financial management of the services is a joke! The financial people spend most of their time trying to get out of work and have no policies concerning financial actions or accounting policies! The Defense Department has financial management regulations that are flat out wrong based on accounting standards and force the services to report on a wrong basis. The services producing annual financial statements for the service are driven by DoD to report what DoD wants to see reported and not what the services view as proper. Look at the resumes of those in the top positions that develop and implement policy for financial management and accounting. For example, in the Air force none of the top people have any experience to speak of in the private sector and all but one have no formal training as accountants! Yet these people are developing the accounting policy for the services. Those who have any formal education background are trained at the worst possible schools and most are retired service people or have served a long time in the services. You don't need any service training to establish good accounting and financial policies and practices for the Air force or any other service. Comptroller General Walker can spout his oratorical disgust forever and the people involved cannot change anything because they have no ability to change anything to what is correct! The solution is not to appoint or hire another head from the same batch or incompetent financial people. The solution is to get rid of the vast majority of those currently in the top SES and political appointee spots and hire some competent financial managers and accountants! Taxpayer Posted November 17, 2006 7:13 AM