Military services questioned over financial management

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.