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House panel kicks off Pentagon acquisition reform drive

A United States Marine stands by his post in front of the Pentagon in Washington February 29, 2012. REUTERS/Gary Cameron
A United States Marine stands by his post in front of the Pentagon in Washington February 29, 2012. REUTERS/Gary Cameron

By Andrea Shalal-Esa

WASHINGTON (Reuters) - The House Armed Services Committee on Tuesday kicked off a fresh drive to fix the way the Pentagon buys weapons and services, vowing to "look past Band-Aid fixes and parochial interests" and implement meaningful reforms.

The committee's chairman, U.S. Representative Buck McKeon, said some successful efforts were already under way, but the U.S. military acquisition system still faced significant challenges including cost overruns and schedule delays, and those would get worse due to mounting pressure on U.S. budgets.

"The Congress, together with the Department of Defense and industry, must be willing to do the hard work to find root causes, look past Band-Aid fixes and parochial interests, and have the courage to implement meaningful, lasting reform," McKeon said at the start of a hearing on the issue.

McKeon said he had asked Representative Mac Thornberry, a Texas Republican, to lead the long-term effort, aided by Representative Adam Smith, the top Democrat on the committee.

The latest Government Accountability Office report calculates that the Pentagon is slated to spend $1.5 trillion to acquire 85 separate weapons programs in coming years. Those programs are projected to experience $411 billion in cost growth and average scheduled delays of 27 months, the GAO estimates.

Paul Francis, managing director of acquisition and sourcing management for the GAO, told the committee that previous reform efforts had started to slow cost growth, but 39 percent of the weapons programs on the books in fiscal 2012 had experienced cost growth of 25 percent or more.

Lockheed Martin Corp, Boeing Co and other major weapons makers argue that layer upon layer of congressional and Pentagon oversight, coupled with thousands of pages of federal acquisition rules, make the system inefficient and too bureaucratic to function well.

Francis, former Pentagon comptroller Dov Zakheim and other experts presented a number of recommendations, ranging from extending the period of time that Pentagon program managers stay on the job, to creating better incentives for contractors, and streamlining federal acquisition rules.

"The current year of budget constraints renders the need for acquisition reform even more urgent than in the past," Zakheim told the panel. "We can't afford to waste a cent, much less dollars or billions of them."

Zakheim said decades of reform efforts had not made much of a dent in the arcane Pentagon procurement system, and a radical restructuring was needed, but it should involve Congress, the contractors, the Pentagon and the White House.

Pierre Chao, senior associate at the Center for Strategic and International Studies, told the hearing that too many of the past reform efforts had failed because they did not attack the root causes of cost overruns and schedule delays.

He argued against "one size fits all" solutions, and said Congress should revisit the many laws already on the books.

"Many of the problems of the acquisition system are really the result of unintended consequences of a very byzantine and at time outright contradictory set of laws and regulations, rather than outright malice or malfeasance on the part of the people," Chao said.

He also called for a new look at "revolving door" policies that made it difficult for experienced people to move between industry and government jobs, arguing that the current rules made it difficult to bring the best people into the right jobs.

Zakheim said Congress should also set high standards for the job of deputy defense secretary, since that was the person who ultimately oversaw acquisition programs.

The White House is now vetting candidates to replace Ashton Carter, the deputy defense secretary, who announced earlier this month that he will step down in December.

The current comptroller, Bob Hale, and the Pentagon's chief weapons buyer, Frank Kendall, have been named as possible replacements.

"Culture starts at the top. And I think one thing that Congress can do is really tighten up the requirements for who should be deputy secretary of defense," Zakheim said. "The deputy secretary of defense should ... ultimately be accountable for the kinds of things we're talking about."

(Editing by Matthew Lewis)

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