Defense procurement problems won’t go away

Walter Pincus
Reporter May 2, 2012

In June 1986, after a year-long investigation, then-President Ronald Reagan’s Blue Ribbon Commission on Defense Management — later known as the Packard Commission — filed a final report.

It was established to investigate Pentagon procurement after an enormous increase in defense spending and the discovery of the infamous $435 hammer and $600 toilet seat. The panel was chaired by David Packard, co-founder of Hewlett-Packard Co., and deputy defense secretary in the Nixon administration.

Its declaration: “The Department of Defense’s acquisition system continues to take longer, cost more and deliver fewer quantities and capabilities than originally planned.” Among causes listed were “stifling burdens of regulation, reporting and oversight.”

Last month, a Defense Business Board task force, established a year ago by the vice chairman of the Joint Chiefs of Staff, Adm. James A. Winnefeld Jr., reported exactly the same “unacceptable” finding. The task force conclusion came after a study that included 221 interviews and review of 300 past studies and commission findings.

Its declaration: The Defense Department “acquisition system continues to take longer, cost more, get less and oftentimes not what is needed.”

What can be more boring than reading about yet another set of recommendations for fixing a system that over the past decade has seen the Defense Department flooded with funds. It’s been so flush that it could walk away from $50 billion worth of “weapons that either did not work or were overtaken by new requirements given the average 15-to-18 year development cycle,” according to the Punaro task force report.

And — yawn — the overruns are hardly over. This is in spite of the need to reduce defense spending. More yawn-inducing reality: The Government Accountability Office recently reported current major weapons systems will show a cost growth of $135 billion before they are fully integrated into the system.

Boring and frustrating. It was time to do something 26 years ago. The only major lasting memorial to the Packard Commission is its recommendation for an undersecretary of defense for acquisition. The Pentagon has had one since that time, but the problems remain.

“Today there is no rational system whereby the Executive Branch and the Congress reach coherent and enduring agreement on national military strategy, the forces to carry it out, and the funding that should be provided — in light of the overall economy and competing claims on national resources.”

This was the Packard Commission more than two decades ago. The same idea is in the Punaro report. The task force was chaired by Arnold Punaro, a former long-time top staff member of the Senate Armed Services Committee, director of SAIC Inc., a defense contractor, and a retired Marine Corps Reserve major general.

But no one is going to read the report. Its title alone is a snoozer: “Linking and Streamlining the Defense Requirements, Acquisition, and Budget Processes.”

Of course, it should be read, but let’s face it: There’s nothing sexy about a subject that drains billions from the budget.

Of the fiscal 2013 Defense budget, some $400 billion is for procurement, research and development, goods and services, according to the Punaro study.

The Pentagon carries out some 1,200 contracting activities from building ships to cutting edge technologies to consumables, services, repair parts and day-to-day needs.

Some 152,000 military and civilian personnel work in acquisitions, including 30,000 contract officials and another 16,000 in program management.

Yawn. Yawn. Yawn.

No one could provide the task force the number of contractors supporting these people though the Defense Department’s “best guesstimate is roughly 766,000 contractors at a cost of about $155 billion,” according to the Punaro report. The handbook for acquisition officers is 962 pages, and federal acquisition regulations runs over 4,000 pages.

The Punaro task force’s first recommendation: “Zero base the entire system, including all directives and regulations.”

At the heart of that suggestion is the conclusion that procurement’s three processes are broken — the military set requirements, followed by an essentially civilian-directed acquisition, along with a hybrid budgeting system to pay for it.

The Punaro Task Force proposed that requirements, acquisition and budgeting be merged with a common documentation throughout. It also recommended requirements be frozen, after cost, schedule and technical tradeoffs have been made. Industry is to be brought early into the process, and the current wall between military requirements and civilian-controlled acquisition should be removed. Service chiefs should be involved throughout the process.

Still awake? We all should be — and particularly Congress.

“Congress should work to recodify all federal statutes governing procurement into a single government-wide procurement statute ... aim[ed] not only at consolidation, but more importantly at simplification and consistency.”

That’s the Packard Commission from 26 years ago.

It’s time to pay attention.

For previous Fine Print columns, go to washingtonpost.com/fedpage.

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