Top military leaders testified on Capitol Hill Wednesday concerning the effects of fiscal year 2014 continuing resolution and sequestration cuts on acquisition and modernization for their respective branches.
Confronted with draconian budget restrictions, leaders from the Army, Navy, Marine Corps and Air Force announced highly specific potential cuts to their 2014 acquisition plans.
Witnesses cited “uncertainty” and “lack of stability” as the greatest hurdles posed by Congress’ staggered budgetary progress, which cripple the military’s ability to develop long-term and cost-efficient strategy for acquiring new products and technology.
For example, multi-year, fixed-price procurement contracts are desirable, as the unit price is generally lower, but funding uncertainties thwart the government’s ability to enter and complete them. According to the Army, the CH-47 Chinook production contract may be jeopardized by FY14 sequestration, which would result in $77 million in contract termination liability, and $1.4B cost increase over the expected life of the contract.
Funding insecurity imposes a hand-to-mouth existence, where forces must “forfeit long-term priorities to fund near-term readiness.”
All witnesses were also quick to cite the potential effects of cuts to the defense industry’s industrial base. “Some [companies] may decide to just close their doors, while others may decide to exit the….market and no longer maintain the technical expertise and status as qualified sources.”
Once again, witnesses emphasized that with inflexible and indiscriminate cuts, degraded readiness is inevitable.
“Our appeal is that Congress complete its work on the FY 2014 defense authorization and appropriations bills and eliminate sequestration before we are driven to irreversible actions which impair our collective responsibility to provide for the nation’s defense.”
Prospective cuts, at a glance
Navy-Marine Corps
- Under a CR, funds are not available for new procurement or to increase production rates above those sustained in FY13. Major programs affected include: F-35 Joint Strike Fighter (JSF), MQ-8 FireScout, EA-18G Growler, Joint Precision Approach and Landing System (JPALS), and Advanced Precision Kill Weapon System (APKWS II) integration with MH-60R Seahawk.
- Sequestration will compel reduction of
- E/A-18G Growler procurement by up to four aircraft;
- E-2D Advanced Hawkeye by one;
- P-8A Poseidon by up to two aircraft; and
- MV-22B Osprey by up to three aircraft.
- Sequestration-level funding will also force reductions and delays in Unmanned Aerial Systems (UAS) programs.
- Overall, relative to the Budget request, sequestration in FY14 would result in the loss of an estimated 25 aircraft (2 F-35, 4 EA-18G, 3 MV-22, 4 H-1, 1 E-2D, 2 P-8A, 1 KC-130J, 3 MH-60, 1 UC-12, and 4 JPATS) across the Navy and Marine Corps.
Air Force
“Sequestration cuts deeply into Air Force investment accounts, which under the law must be applied equally at the program, project, and activity level; consequently, it impacts every one of the Air Force’s acquisition programs.”
- The request for 19 F-35A aircraft will lower by four to five.
- AF will cut of up to 25,000 total Force Airmen and up to 550 aircraft.
- AF will favor new capabilities over upgrades to legacy forces.
- The top three acquisition priorities are the KC-46, F-35, and Long Range Strike Bomber.
Army
The Army expects cuts to training and modernization programs, as well as ground combat and aviation categories. Additionally, the branch is sitting on $73.5 million in deferred maintenance costs from FY13.
- The CR impedes procurement plans for
- Up to 800 Guided Multiple Launcher System Unitary rockets;
- 14 Enhanced Launcher Electronic System Patriot PAC-3 Upgrades;
- AH-64E Apache helicopters;
- MQ-1 Grey-Eagle; and
- UH-60L digital program to upgrade the Black Hawk helicopter, among others.
- The number of Stryker vehicles to be modified to a Double-V Hull configuration would be reduced by 45-50; fielding of a 3rd Brigade of Stryker DVH would be delayed by approximately six months.
