PERMANENT ARMS ECONOMY 
GAO urges DOD to update weapon programs cost oversight

While F-35 procurements have brought down the Pentagon's overall cost of weapons systems development, a GAO report says the overall cost of these programs increased in the last year. Photo courtesy of the Department of Defense

June 8 (UPI) -- The U.S . Government Accountability Office in a report published Tuesday urged the Pentagon to update its oversight approach on it's costliest weapons programs to improve weapon system acquisition.

The GAO made the recommendation in its 19th annual report on the Department of Defense weapon programs, which it is obligated to conduct under federal law.

The report found that many weapon programs have acquisition approaches that could result in cost and schedule challenges that have led to the DOD weapon system acquisition being placed on the High-Risk List for more than two decades.

GAO outlines cost growth issues in a wide range of weapons programs, with specific focus on the F-35 Joint Strike Fighter -- noted as the Pentagon's current costliest program -- and that it's costs have gone down since the agency's previous report because of procurement reductions.

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The DOD now has six acquisition "pathways" designed to account for the type of weapon system, including major capability acquisition and middle-tier acquisition pathways used by the programs GAO reviewed, and timeframe its needed, but more options are needed, according to the GAO report.

"In particular, DOD has yet to develop an overarching data collection and reporting strategy for programs transitioning between acquisition pathways or conducting multiple efforts using the same pathway to deliver the intended capability," the report stated.

"The lack of strategy not only limits DOD's visibility into these programs but also hinders the quality of its congressional reporting and makes the full cost and schedule for the eventual weapon system more difficult to ascertain," GAO said in a summary of the report.

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The GAO added in the report that the DOD plans to invest over $1.79 trillion in its costliest weapon programs, but not all costs are reported.

The report carries a recommendation for multiple reporting capabilities in order to provide more information on each individual program effort, overall planned costs and a schedule for delivery of the program's expected capability.

Primarily, major defense acquisition program costs are reported, but the DOD is increasingly using the middle-tier pathway to acquire weapons programs. This acquisition tier does not, however, include potential investments beyond the current cost or cover classified programs.

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The F-35 program, the Pentagon's largest, reported a procurement cost decrease of $23.9 billion in fiscal year 2020, "primarily due to lower prime and subcontractor labor rates," the report noted.

Earlier this year, however, the GAO reported that a Pentagon project to continuously modernize the F-35 has seen about $2 billion in cost growth since 2019.

And while F-35 procurement reductions led to an overall weapons program portfolio cost decrease since GAO's last annual report, delivery and test delays and poor system performance led to a growth in costs in the last year, the report said.

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Meanwhile, the DOD continues to expand its MTA programs, which the GAO could not assess due to inconsistent cost reporting.

The GAO added many weapon programs failed to attain knowledge that could limit cost growth and deliver weapon systems faster, and "they inconsistently implemented leading practices," including "conducting certain types of cybersecurity assessments during development."

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