Commanders warn defense industry against delays, cost overruns
WASHINGTON — Watch your nickels and dimes and deliver what you’ve agreed on, a panel of Navy and Marine commanders in charge of supplying ships, planes and other weapons systems warned a room full of industry representatives and military program officers on Tuesday.
With the U.S. defense budget slashed by nearly $487 billion over the next decade, and the looming prospect of sequestration threatening to more than double the cuts if a deadlocked Congress doesn’t act soon, they said, tolerance for delays and cost overruns is evaporating.
“We’re coming to an era when we issue a contract, we expect industry and the government to deliver on that contract,” Vice Adm. Kevin McCoy, commander of Naval Sea Systems Command, told the gathering at the Navy League’s Sea Air Space Expo.
He later added, “We expect to pay a fair price, we expect industry to make a fair profit, but when we sign a contract, we expect to get exactly what we pay for on schedule and on terms.”
The military and industry alike have no choice but to find ways to operate more efficiently, said Marine Brig. Gen. Frank Kelley, head of Marine Corps Systems Command. Pointing to a giant screen flashing grim budget-related statements made in recent months by Defense Secretary Leon Panetta and his deputy, Ash Carter, Kelley said,
“The Readers Digest version of that is, if you think you’re going to do business the way you’ve done it for the last 10 years, think again,” Kelley said.
The panelists indicated that a key to cutting costs will be to centralize decisions about giant expenditures in the hands of top commanders.
It will take away some of the independence commands now enjoy, but it can also save money, said Rear Adm. Patrick Brady, commander of Space and Naval Warfare Systems Command.
“We basically no longer have the resources to let each command or program office optimize their organization at the expense of the fleet or the expense of the larger Navy,” he said.
The coming budgetary necessities will be stressful, Kelley said, particularly when it comes to supplying certain kinds of equipment to Marines on the battlefield.
“We’ve not had to say no ever,” he said. “Now we’re getting into an era when we are going to have to say it.”