DOD budget cuts target contractors, IT programs

Secretary Gates details cuts, consolidations to better use DOD funds

Editors' note: This article was revised on Jan. 7 to correct erroneous information: Gates' plan will slash more than $1 billion from IT expenditures, and plans to reduce the number of contractors pertain only to staff-support roles.

Defense Secretary Robert Gates today updated his proposal to shift $100 billion in the Defense Department budget to help fund the dual-front war, identifying an additional $78 billion in cuts that will be put toward the federal deficit, including some from  IT.

Gates' plan is the first stage of a three-year effort to carve away 10 percent of the staff-support contractors that DOD employs, slash $10 billion from IT expenditures and cancel some expensive weapons systems. The moves come as the Pentagon faces $13 billion less than initially planned for in the fiscal 2012 budget.

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Gates hopes to compensate for some of the cuts with organizational changes so that services can be delivered for lower costs. For example, Gates, who detailed the plan in a briefing today, said the Army expects to achieve $500 million in savings by consolidating data centers and moving to an enterprise e-mail system. Gates also said that IT costs DOD about $37 billion with all bases and headquarters having their own IT infrastructures, which will be consolidated to enterprise systems to save more than $1 billion per year.

Still, Gates will have to swing an axe to achieve some of his goals. He said 270 contractor positions will be eliminated from the Office of Secretary of Defense’s policy arm and the acquisition, technology and logistics office; 780 contractor positions from the Army TRICARE military health program; and 360 contractor positions from the Missile Defense Agency. 

Those cuts will be part of a 10 percent annual reduction in the use of contractors in staff support positions over the next three years and will save more than $6 billion, he said.

As expected, Gates said he is canceling the Marine Corp’s Expeditionary Fighting Vehicle program and the Army’s non-line-of-sight surface-launched missile system, which was part of the previously closed Future Combat Systems program. The Marines' variant of the F-35 joint strike fighter program, which Gates said has had trouble in testing, will be put on a two-year probation period after which it could face cancellation if it doesn't prove to be efficient and cost-effective. The Air Force F-35 variant will not face cancellation.

Gates also said the Navy 2nd Fleet headquarters, located in Norfolk, Va., will have its primary training and preparation responsibilities transferred to Fleet Forces Command. Joint Forces Command, also headquartered in Norfolk, will face closing despite significant pushback from Capitol Hill since the move was initially announced.

Gates said that in identifying areas that could yield savings, special attention was paid to support elements outside the four services. He announced a DOD-wide freeze on civilian positions, and projected roughly $54 billion would be saved in personnel cuts when combined with the recent federal pay freeze.

Within OSD, Gates said 80 billets would be eliminated or downgraded, and roughly 200 civilian executive positions face similar fate.
“The savings here will be relatively modest, but will create fewer, flatter and more efficient organizations,” he said.

Additionally, force structure will shrink under the budgetary measures, with up to 47,000 troops potentially being cut beginning in 2015.

U.S. intelligence operations won’t escape the cuts, either.

“Since [the terrorist attacks of] Sept. 11, we have seen a proliferation of intelligence operations,” Gates said, noting that new intelligence offices centered around combatant commands would be downsized, and in place of a large, organic intelligence apparatus would come smaller-level capabilities to surge intelligence operations on an ad-hoc basis.

The Defense Intelligence Agency will see consolidation of two redundant task forces as well, Gates added.

However, increased investment will go toward certain capabilities, according to the secretary. Intelligence, surveillance and reconnaissance programs will be moved from the temporary war budget to the permanent DOD budget, and some investments will include modified radar capabilities for the Air Force’s F-15 tactical fighter aircraft and more simulators for the F-35 joint strike fighter.

A new long-range, nuclear-capable, remotely piloted bomber will also be developed, Gates added.

Gates rejected previous reports that said $100 billion would be removed from the DOD budget over the next five years. “We’re not cutting the defense budget, we’re moving [wasteful] spending. The budget will be bigger in dollars than it was in years before,” he said.

Today’s announcements, like those related and similar that have preceded them, will likely continue to face controversy throughout Washington.

“There are two ends to this – one end says that we’ve gone too far, the other says we haven’t gone nearly far enough. My view is we got it about right,” Gates said.

Joint Chiefs of Staff Chairman Navy Adm. Mike Mullen, also speaking at briefing, backed Gates’ proposed budget measures.

“The chiefs and I are in great support of these decisions,” he said.

The decisions were announced following a day of meetings at the Capitol with prominent members of the House and Senate armed forces committees. When asked to characterize the Capitol Hill meeting, Gates said, “There were a number of questions, but very little editorial comment.”

About the Author

Amber Corrin is a former staff writer for FCW and Defense Systems.

Reader Comments

Wed, Jan 12, 2011

Support contractor work is intended to be of short duration, as a supplement to the DoD workforce, providing expertise not available within the DoD workforce. Unfortunately, such work tends to be lifetime work. In organizations I have been in, support contrctors are indistinguishable from DoD civilians. As to cost, I find engineering and program management support to be at the high-end of the scale, comparable to GS-14 and above pay. On top of worker salary is overhead, benefits, and profit for the employee's company. In DC, you will almost always find support contractors in your meeting, and often they are the ones giving direction (I know it's illegal, but it happens anyway). When a support contractor becoms indistinguishable from the Government civilian, something is wrong.

Tue, Jan 11, 2011

I'd venture to guess that it isn't just the IT staffs that spend inordinate amounts of time surfing the net!! Ever notice the "Loggies", "RM'ers", etc. peeking above their monitors to see who just came in? Frankly, most of the IT depts. I've been associated with have been just too busy to partake in the web "fun".

Mon, Jan 10, 2011

Seeme that every time DoD wants to save a buck they slash at contractors and never touch a federal reduction in force. So who is really costing the tax payer big bucks, the contractor hired for a few years or the fed employed for thiry who ends up having most of the work done by a more qualified contractor anyway?

Mon, Jan 10, 2011 Blaine Lashbrook Tyndall Air Force Base, Florida

I have no idea just how many Military Bases there are throughout the world, but I am sure they number in excess of a thousand. Every one of them every time there is a change of command, the new commander has their office spaces and their support staff have theirs renovated. I am talking about new furnature, remodeling the offices, and in many cases changing the landscape in front of the buildings. All this comes at a great deal of expense. Then the old materials that may have just been replaced two or three years prior, is disgarded and wasted. It may go to DRMO where it is sold at salvage price of pennies on dollars, but there is absolutely no reason for it to have been replaced any way. All of this results in Hundreds of Millions of dollars wasted every year. I would like to see a FREEZE on any expenditures of renovations unless the place is over ten years since the last renovation. Also the changing of computers and monitors is out of control. I have seen literally hundreds of flat screen monitors, laptops less than 3 years old, and cesktop computers less than three years old disgarded for newer more modern looking ones. The old are still very much capable of doing the word processing and record keeping they are supposed to be being used for. However the people want to be able to surf the internet and stream radio or music, while working. All of which is security wise unauthorized. Just cutting all this waste out would save BILLIONS of dollars throughout the DOD. We could then leave our maning level of active forces alone, and provide them with the equipment they need to defend themselves with. Yes I agree there is an awful lot of waste in the manning of civilian wmployees also. The unfortunate thing thereis that the real waste of money there is in the EXECUTIVE end. There are far too many chiefs and not nearly enough indians. Also the chiefs are way to over paid for the positions. Every government civilian employee making over $100,000.00 (100K) per year, should have a minimum 10% pay cut with no strings attached. I get so sick when I see all the stuff in perfect condition and still completely servicable go to DRMO. WAKE UP SENIOR people do your job and stop the wasteful spending. Then just maybe your saleries may be able to be left alone.

Mon, Jan 10, 2011 Anonymous Norfolk, VA.

Notice SecDef is closing USJFCOM to save money on all those contractors currently working at JFCOM. What isn't said is all those contractors didn't appear at JFCOM because JFCOM's Commander thought it a good idea to have them. They're there due to the Joint Staff funding projects at a cheaper cost to the taxpayer at JFCOM in Hampton Roads, VA. vice working directly for the Joint Staff in DC. A dirty little secret is many of the contractor jobs lost at JFCOM are going to reappear within the Joint Staff or other commands in/around the DC Beltway at substantially higher costs to the taxpayer. My own position for example is being moved from Norfolk to DC at an increased cost on the contract - an to the American taxpayer - of $50K for me to perform the same functions. Many JFCOM contractors are already doing the DC commute with more of us on the way. This is disrupting families and costly the taxpayer millions more in the name of DoD consolidation. I'll go out on a limb and predict not much if any monies will be saved by these changes. Plus most of us will return to Hampton Roads once other positions of equal pay eventually open up in Hampton Roads - losing our expertise to the Joint Staff that hired us in the first place.

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