Improved Management of Air Force Modification Programs Can Save Millions

Gao ID: PLRD-81-5 March 16, 1981

Air Force policy is to use existing items that may be available in the Department of Defense (DOD) supply system before it purchases new items for modification kits.

GAO found that the Air Force purchases most of its modification kits through contracts without considering the DOD supply system. GAO believes that the lack of screening for the needed items has resulted primarily from: (1) confusion and misunderstanding on the part of the centers' personnel, coupled with vague and sometimes contradictory Air Force regulations; and (2) a lack of faith on the part of the Air Force that the Defense Logistics Agency (DLA) can effectively support the modification programs. GAO believes that significant savings can result from using DOD-managed items. The Air Force has proposed alternative procedures to correct unnecessary costs. However, the Air Force proposal has not been implemented, and GAO believes that it contains weaknesses which should prompt consideration of another alternative. In addition to requiring contractors to perform duties which Air Force personnel are already supposed to be doing, the proposal will require contractors to requisition DLA-managed items on a fill or kill basis. Thus, DLA will have an opportunity to provide needed items only if they are on hand. The proposal will not afford DLA the opportunity to provide items through procurement actions. In its application of the DOD phased procurement policy, the Air Force overlooks opportunities for significant savings. Congress, DOD, and the Joint Logistics Commanders have recognized that the exceptions to the phased procurement policy may result in significant savings. The Joint Logistics Commanders have recommended that the DOD directive be revised to clarify this.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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