Defense Infrastructure

The Pentagon is counting on large savings from streamlining infrastructure to pay for new weapons systems, but GAO found that substantial net savings from infrastructure improvements, such as base closures and military purchasing reforms, are unlikely during the next five years. In defining "infrastructure," the Defense Department (DOD) has excluded most intelligence; space; and command, control, and communications programs. These programs will cost about $25 billion in fiscal year 1996. If DOD's objective is to examine all possible infrastructure for savings, it should include these programs. Moreover, some infrastructure costs are hidden in accounts that are supposedly devoted to operations and maintenance and to quality-of-life programs for military personnel. Unless the Pentagon is willing to consider these areas, military overhead will likely remain relatively constant--at 60 percent of DOD's budget--through 2001. This report identifies options to consolidate and reengineer infrastructure that would yield savings of nearly $12 billion in future years.

GAO found that: (1) there are no significant net infrastructure savings to DOD between FY 1996 and FY 2001, based on GAO analysis of infrastructure-related program elements in FYDP; (2) the proportion of planned infrastructure funding in DOD budgets will remain relatively constant at about 60 percent through 2001; (3) the combination of operation and maintenance and military personnel appropriations fund about 80 percent of infrastructure activities that can be identified in FYDP; (4) DOD excludes most intelligence, space, and command, control, and communications programs the provide support services to mission programs from its definition of infrastructure; (5) these programs account for about $25.2 billion in FY 1996; (6) parts of total infrastructure funding cannot be clearly identified in FYDP, including funds that pay for Defense Business Operations Fund activities; and (7) there were 13 options for consolidating, streamlining, or reengineering infrastructure activities that CBO estimates could result in savings of $11.8 billion from FY 1997 through FY 2001.