By Marina Malenic
The Pentagon’s top weapons buyer said yesterday that the department is studying more program terminations and plans to conduct a careful cost scrub of several major acquisitions before allowing them to proceed.
“In the spring of 2009, we canceled so many programs that were either unneeded, that we had enough of, were underperforming or whose time was past,” said Ashton Carter, the undersecretary of defense for acquisition, technology and logistics. “We will have to do more of that.”
Carter was speaking at the Center for American Progress, a left-leaning think tank in Washington.
Defense Secretary Robert Gates earlier this year launched an “efficiency initiative” to slash overhead that he would then apply to essential programs and front-line needs. Echoing other senior officials, Carter noted yesterday that the department is “unlikely to be enjoying the double-digit growth of the last decade.”
Instead of increased funding, the Pentagon is now seeking “productivity growth” in purchasing under Carter.
“We need to do more without more,” he said. “We need more program…but we’re not going to get more money.”
To that end, major acquisition programs will be going through a cost scrub akin to the one that has reduced the price of the Navy’s next-generation Ohio-class ballistic missile submarine. Initial estimates for the SSBN(X) were as high as $7 billion per submarine, Carter said.
Under those circumstances, “we wouldn’t be able to build any other ships in the Navy, so that’s not happening,” he said. “So we began challenging everything that was driving the cost of that submarine.”
As a result, he said, the Pentagon is “en route to a reduction of about 30 percent” of the initial estimates. Carter is scheduled to formally review SSBN(X) this month to determine if the effort can enter into the Milestone A phase of development.
Carter said the same process is being applied to the Presidential Helicopter replacement effort, the Air Force’s next-generation bomber and the Army’s Ground Combat Vehicle program before development is even permitted to get under way.
Meanwhile, Carter said he is scrutinizing current development programs in the same way. For example, he noted that the Pentagon’s latest cost estimate for the troubled F-35 Joint Strike Fighter program is $112.4 million per plane–an 81 percent increase over the baseline set in 2002.
“To which my answer is no, not happening,” Carter said. “We have to reverse that cost growth.”
A formal review of the program by Carter and the Defense Acquisition Board is scheduled for next week, at which time the Pentagon will decide how to proceed.
Carter said that he sees the cost savings proposed by Gates as reasonable.
“It’s safe to say that after year on year budget growth, there is fat in there,” he said. “And we should be able to lean that out.”
The alternative, he said, is “broken programs and…unpredictability for industry, as well as the erosion of the taxpayers’ confidence.”
Carter said that a “technologically vibrant and financially healthy” defense industry is critical to the performance of the military.
“It’s really a matter of using incentives to get what we want,” he said. “You want to have a profit policy that…rewards your contractor for doing the hard work.”