GAO: Most Pentagon weapons programs exceed cost estimates

By Kellie Lunney

March 30, 2011

At least half the weapons programs in the Defense Department's portfolio have exceeded costs, according to the Government Accountability Office.

The total cost of the 98 programs comprising the Pentagon's major defense acquisitions has risen since 2008 by $135 billion, of which $70 billion can be attributed to poor management or execution problems, GAO said in a recent report. A small number of programs are responsible for the procurement cost growth; the Joint Strike Fighter, for instance, because of unproven technology and other problems, accounted for $28 billion of increase without a change in quantities, according to the report.

"We simply cannot balance our budget when we consistently pay hundreds of billions of dollars more than expected for our major weapons systems," said Sen. Tom Carper, D-Del., at a Tuesday hearing during his opening statement as chairman of the Homeland Security and Governmental Affairs Subcommittee on Federal Financial Management.

More than half of the portfolio's total cost growth since 2008 was driven by 10 of the department's largest programs, all currently in production, including the Joint Strike Fighter, DDG 51 Destroyer and C-17A Globemaster III.

"As these programs leave the portfolio through completion or cancellation, their cost will leave with them," said the GAO report that was highlighted during the hearing.

Many cost overruns are due to changes in design, schedule delays and immature technology, GAO found. Vacancies among the senior-level acquisition ranks also hindered effective management of the billions of dollars at stake, witnesses said. "Often there are vacancies in policy-making levels for extended periods of time, and it's not a helpful thing for anyone involved," said Richard Burke, deputy director of the Cost Assessment and Program Evaluation Office at Defense.

Carper talked about streamlining the confirmation process for senior acquisition officials to ensure effective oversight of the weapons programs, while Sen. Scott Brown, R-Mass., recommended greater accountability for program managers who do not perform up to par when it comes to reining in cost overruns. Brown, who said cost overruns "seem more like the norm than the exception," is the ranking member of the subcommittee.

John Young, senior fellow at the Potomac Institute for Policy Studies, said the Obama administration needs to "empower" civil servants in the acquisition workforce to make responsible procurement decisions.

GAO praised the Pentagon for its efforts to incorporate the 2009 weapons system acquisition reform law. "To its credit, DoD has demonstrated a strong commitment, at the highest levels, to address the management of its weapon system acquisitions, and the department has started to reprioritize and rebalance its weapon system investments."


By Kellie Lunney

March 30, 2011

http://www.govexec.com/defense/2011/03/gao-most-pentagon-weapons-programs-exceed-cost-estimates/33647/