DoD can't fully verify efficiency savings, says GAO

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In its fiscal 2012 budget request, the Defense Department outlined $178 billion in efficiency savings over a 5 year period, but the Government Accountability Office says DoD needs a better system in place to truly track and report on those savings.

In a Dec. 4 report (.pdf), GAO says that while the Pentagon has provided general direction to the military services, defense agencies and the United States Special Operations Command, it has not provided clear enough definitions and methodologies to be used for efficiency program measurements and reportable savings.

Formal guidance "should define reporting requirements for such things as the specific types of costs associated with implementing the initiatives, including implementation costs that were not initially identified in calculations of net savings," says GAO.

The concern that DoD's existing guidance will "result in incomplete reporting, which may limit the visibility of senior leaders," comes because cost data included and excluded varies by each project, writes GAO.

For example, when the Navy calculated savings by an initiative to reduce fleet shore command personnel from the U.S. Pacific Fleet and U.S. Fleet Forces Command, it did not account for increased costs to relocate the shore command personnel to other areas within the Navy.

In May 2010, DoD announced a plan to monitor efficiency for how the department is staffed, organized and operates, with a goal of reducing overhead costs and reinvesting the savings in weapons modernization. The goal was to find $100 billion in savings between fiscals 2012 and 2016. The additional $78 billion comes from a proposed reduction in its overall budget related to these efficiency savings over the same time period.

Military departments and SOCOM have implemented some steps to reduce overhead and increase efficiency, such as reassigning personnel from organizations being consolidated and terminating weapon system programs. They have also instituted protocols to review progress like establishing expected completion dates for initiatives and reports on estimated savings targets.

GAO says that the initiatives set in place have the ability to reach savings goals as they cut or reduce low-priority programs and combine efforts, but still require a consistent reporting fashion.

Defense says it agrees with the recommendation and plans to distribute formal guidance before the next round of briefings in February.

 For more:
- read the report, GAO-13-105R (.pdf)

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