Defense Budget

Since the end of the Persian Gulf War in February 1991, the Department of Defense (DOD) has reported over $25 billion in incremental costs for its overseas contingency operations. These operations include the enforcement of no-fly zones, humanitarian assistance, and peace enforcement operations. The majority of these costs ($22 billion) have been incurred in the Balkans (Bosnia and Kosovo) and Southwest Asia. In fiscal year 2001, U.S. military forces are continuing to participate in a number of contingency operations, primarily in the Balkans and Southwest Asia. In this report, GAO reviews (1) the adequacy of DOD's incremental contingency operations funding for all ongoing contingency operations in fiscal year 2001, (2) DOD's estimated contingency operations costs for fiscal year 2002, and (3) the ramifications of DOD's plan to change the method for funding its operations in Southwest Asia. GAO found that (1) existing funds are sufficient to cover DOD's estimated costs for ongoing contingency operations for fiscal year 2001, (2) in June 2001, the administration submitted a revised fiscal year 2002 budget for DOD, which included $4 billion for ongoing operations in the Balkans and Southwest Asia, and (3) the positive ramification is that appropriating funds directly to the services' appropriations accounts could provide an added incentive to better control costs. The negative ramifications are the possible loss of visibility for Southwest Asia funds because of the substantial movement of funds within the services' operation and maintenance accounts as has occurred over a period of two years, and the possible discontinuance of cost reporting for operations in Southwest Asia.

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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