Defense Acquisitions

GAO reported in March 1999 on the extent to which cost, schedule, and performance goals were being met in the F-22 aircraft's engineering and manufacturing development program. (See GAO/NSIAD-99-55 and GAO/T-NSIAD-99-113.) This statement for the record summarizes the relevant parts of that report and testimony, describes the congressional actions on the fiscal year 2000 budget request, updates the information that GAO gave Congress in March, and discusses initiatives by the Air Force and contractors to control production costs.

GAO noted that: (1) in March 1999 GAO reported that it was unlikely the Air Force would be able to keep the F-22 engineering and manufacturing development (EMD) program, as planned, within the cost limit established by Congress; (2) in addition, GAO expressed concern about the significant reduction the Air Force had made in the testing it planned to complete before awarding contracts to initiate advance procurement to accelerate F-22 production; (3) both authorization and appropriations acts for fiscal year 2000 establish further congressional direction for the F-22 program; (4) the authorization act required certification by the Secretary of Defense, prior to beginning low-rate initial production, that the EMD test plan is adequate for determining F-22 operational effectiveness and suitability; (5) the appropriations act did not approve the beginning of F-22 low-rate initial production but approved funding for acquisition of additional flight-test aircraft with research, development, test, and evaluation funding; (6) the F-22 program has made progress in manufacturing and testing aircraft; (7) however, there continues to be several important issues regarding the cost of the EMD and production programs and the schedules for completion of EMD activities leading to production of F-22s in higher quantities; (8) preliminary indications from GAO's ongoing review of the EMD program's status show that, compared to the program's status in March 1999, sufficient cost reductions have not been implemented to ensure that EMD activities, as planned, can be completed within the cost limitation, and completion dates for testing F-22 aircraft may be further delayed; (9) GAO's evaluation of the Air Force's progress in meeting cost, schedule, and performance goals is continuing as directed in the National Defense Authorization Act for Fiscal Year 1998; (10) GAO plans to issue a report to Congress concerning its current evaluation by March 15, 2000; (11) in 1997, the Air Force indicated that the most probable cost for production of 438 F-22 aircraft would exceed its cost estimate by $13 billion; and (12) the Air Force plans to implement initiatives to offset this projected cost increase.