Washington, D.C.—Today, the House Armed Services Committee Panel on Defense Acquisition Reform voted to unanimously approve a final version of its report on the defense acquisition system. The panel was appointed in March 2009 to carry out a comprehensive review of a system that Committee members believed was not responsive enough to today’s mission needs, not rigorous enough in protecting taxpayers, and not disciplined enough in the acquisition of weapons systems for tomorrow’s wars.
During the past year, the panel held fourteen hearings and two briefings covering a broad range of issues in defense acquisition. The final report, which is available on our website , includes recommendations that are intended to save the Department of Defense $135 billion over the next five years. Below are the opening remarks of Congressman Rob Andrews (D-N.J.), Chairman of the panel, before this morning’s vote:
“Today the Panel will discuss and approve its final findings and recommendations on defense acquisition reform. On March 4, we approved the Panel’s interim findings and recommendations, and on March 11 we heard from the Department of Defense on its acquisition reform priorities and on its thoughts about the Panel’s work.
“Having received this feedback, as well as feedback from our previous witnesses and other experts, we are now ready to deliver a final report to Chairman Skelton and Ranking Member McKeon. After delivering our report, the Panel’s official mandate will expire. However, I expect that the Panel’s recommendations will serve as the basis for legislation that will be considered in the House this year and will ultimately be enacted into law.
“The Panel held a total of 14 hearings and 2 briefings on the defense acquisition system over the course of a year-long review. The Panel found that while the nature of defense acquisition has substantially changed since the end of the Cold War, the defense acquisition system has not kept pace.
“The system remains structured primarily for the acquisition of weapon systems at a time when the acquisition of services, and of information technology, represents a much larger share of the Department’s budget. There is little commonality across the defense acquisition system: the acquisition of weapon systems, the acquisition of commercial goods and commodities, the acquisition of services and the acquisition of information technology have very diverse features and challenges. This created a challenge for the Panel in developing its recommendations.
“In some areas, however, the Panel found common, overarching issues and these issues became the focus of its findings and recommendations. Across all categories of acquisition significant improvements can be made in: managing the acquisition system; improving the requirements process; developing and incentivizing the highest quality acquisition workforce; reforming financial management; and getting the best from the industrial base.
“The Panel began with the question of how well the defense acquisition system is doing in delivering value to the warfighter and the taxpayer. For most categories of acquisition, only anecdotal information exists about instances where the system either performed well, or poorly.
“Even where real performance metrics currently exist, they do not fully address the question. The Panel found that the Department needs to regularly and comprehensively assess the performance of the defense acquisition system, and recommends that the newly created Office of Performance Assessment and Root Cause Analysis be expanded to lead this effort.
“These assessments would not simply be material to fill reports to Congress. These performance assessments would be linked directly with the things that matter most to the people working in the system: pay, promotion, and the scope of their authority. A similar effort is needed for the requirements process.
“The central pillar of the defense acquisition system is the acquisition workforce. Only through supporting, empowering, rewarding, and holding accountable the acquisition workforce can the defense acquisition system be expected to improve. To achieve this, the Panel seeks to give the Department the flexibility to efficiently hire qualified new employees, and to manage its workforce in a manner that promotes superior performance.
“The Department must develop new regulations for the civilian workforce which include fair, credible, and transparent methods for hiring and assigning personnel, and for appraising and rewarding employee performance. The Panel also recommends that the Acquisition Workforce Demonstration Program, which incorporates a number of these elements, be extended.
“The Panel found that another pillar of success of the defense acquisition system is the Department’s financial management system. The Panel is concerned that the inability to provide accurate and timely financial information prevents DOD from adequately managing its acquisition programs and from implementing true acquisition reform. The Panel recommends that the Department establish meaningful incentives for the military services to achieve unqualified audits well before the current mandate of September 30, 2017. It also recommends that there be consequences for any entities that do not meet this mandate, which was enacted in the National Defense Authorization Act for Fiscal Year 2010.
“The last pillar underpinning the defense acquisition system is the industrial base. The Panel heard that the Department can enhance competition and gain access to more innovative technology by taking measures to utilize more of the industrial base, especially small and mid-tier businesses. And in managing that industrial base, that the Department is best served when it deals with responsible contractors with strong business systems. Finally, the Panel recommends that the Department work to reform the export control system which is increasingly critical to the success of the industrial base.
“I want to thank all the members of the Panel for their hard work and diligence for attending such a large number of hearings and briefings and focusing so much of their time on an issue that while important, is hard to explain to our constituents and even harder to truly master. This work will pay dividends for congressional oversight of the defense acquisition system for years to come. I now recognize Mr. Conaway for any remarks he would like to make.”