Multiyear Procurement Candidates

Pursuant to a congressional request, GAO analyzed the 10 multiyear candidates proposed in the Department of Defense's (DOD) fiscal year 1986 budget request to determine if they met the established criteria.

GAO found that DOD identified multiyear procurement as a key for improving the weapons systems acquisition process, and Congress enacted legislation which: (1) establishes the conditions that must be met by multiyear candidates to ensure a reasonable balance of benefits and risks; (2) requires that the government benefit from a multiyear contract by saving money and improving contractors' productivity; (3) requires that contract costs and projected savings be realistic; and (4) requires that a system being procured have a stable design, requirements, and funding. GAO found that: (1) although some of the systems or components proposed as multiyear candidates met the criteria, some did not meet one or more of the criteria or had undergone program budget changes that warrant revisions; and (2) it was difficult to identify the enhancement to the defense industrial base that would result from a multiyear contract that would not occur if procurement were done on an annual basis. However, GAO believes that stability in contractor operations associated with multiyear procurement could enhance the defense industrial base.