Defense Depot Maintenance

The Defense Department (DOD) has a policy calling for greater reliance on the private sector for maintenance of its weapon systems. This policy includes a preference for contractors to provide total logistics support for new weapon systems within the limits of existing legislative requirements. This report discusses (1) DOD's policy and implementation plans for allocating depot-repair workloads for new and upgraded weapon systems between the public and private sectors and (2) the process it uses to make source-of-repair decisions.

GAO noted that: (1) overall, its work shows that DOD is moving to greater reliance on the private sector for depot support of new weapon systems and major upgrades; (2) this condition reflects DOD's shift from past policies and practices, which generally preferred the public sector; (3) DOD officials say that DOD is doing this within the framework of existing legislative requirements, while seeking legislative changes that would allow it to make greater use of the private sector; (4) GAO found that, in those programs where source-of-repair decisions have been made or where a specific source of repair is being strongly favored, these determinations were not always well supported; (5) further, weaknesses existed in guidance for implementing the decisionmaking process; (6) of 71 new system acquisition programs reviewed, 46 programs have made a source-of-repair decision or are strongly leaning toward one sector or the other; (7) of the 46 programs, 33 are selecting the private sector for most repairs and 13 are selecting the public sector; (8) the other programs reviewed have either selected a mixed workload utilizing both public and private sectors or are undecided; (9) uncertainty and unresolved issues related to DOD policy guidance, core capabilities, and DOD's belief there may be changes in legislation relating to depot workload allocation have caused several of the large acquisition programs to defer long-term support decisions; (10) in lieu of making a decision, these programs were opting for some type of interim contractor support arrangement that places initial support responsibilities with the original equipment manufacturers; (11) significant weaknesses exist in DOD's implementation of the decisionmaking process for determining depot maintenance strategies for new systems; (12) GAO's review of programs where source-of-repair decisions have been made showed that key factors were not always taken into account during the decision process nor, when they were, were they always consistently applied across programs; (13) for example, cost comparisons between public and private support options were not always done as required or were inconclusive; (14) inconsistencies in the decisionmaking process are partly attributable to changing and contradictory guidance for making source-of-repair decisions and uncertainties regarding public depot core capability requirements; and (15) DOD revised its primary guidance in October 1997 and continues to examine other possible changes.

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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