Review of the Department of Defense's Implementation of Procurement Reforms

GAO was requested to aid in determining the extent to which reforms in procurement practices have been implemented by the Department of Defense (DOD). DOD and the Office of Management and Budget (OMB) provided examples and savings credited to some of the policies and practices, but were unable to do so for others, because they do not routinely collect data and imformation in a manner that would permit attributions of this type. GAO made the following suggestions for improving procurement practices for major weapon systems. The Congress and OMB should encourage the mission-directed approach to weapon system acquisition contained in OMB Circular A-109. During its annual deliberations on defense appropriations, Congress should question DOD and its military services about new weapon programs, so as to assure itself that the need for each new program is clearly established and solutions are sought competitively in compliance with A-109. The Office of Federal Procurement and the Office of the Secretary of Defense should continue periodic reviews of the DOD compliance with A-109. The Congress and the administration should consider establishing a mutually agreed upon acquisition strategy for accomplishing the development and ultimately the production of each new major weapon system. The application of multiyear funding would provide opportunity for economic purchases of materials which can account for over half of a contract's direct costs and would assist in negotiating more favorable production costs, especially where competition is used. Long-range investment planning oriented to military missions, being explored by DOD, may work well with acquisition strategy and multiyear funding.