DOD Inspector General Scrutinizing Parts Management

As budgets tighten and the United States steps back from Afghanistan, the Pentagon’s inspector general office is becoming “more aggressive” in seeking out savings from contracts and programs, according to a senior defense official. The attitude of Defense Department leadership towards audits has begun to shift, especially as budget sequestration continues to proceed without dilution, said this official during a meeting with reporters on July 11 in Washington, D.C. In Fiscal 2012, IG auditors discovered some $2.6 billion in “projected monetary benefit” from contract and program audits, said the official. For Fiscal 2013, the number is already $23.4 billion and is expected to rise, as wide-ranging examinations of weapons systems and sustainment programs are taking place, said the official. Some defense programs have parts stocks that extend out beyond 10 years or more, which is wasteful considering the fluid nature of defense acquisition, said the official. While performance-based logistics are part of the problem, they are not the cause of all this bloat in logistics spending, said the official. The IG office has urged the Defense Logistics Agency to take a “systematic” look at its parts-management procedures, said the official.