Gates Speech on Defense Budget Jan. 6

Read a summary of which military branches win/lose what at Stars and Stripes.

Today, I am announcing a number of decisions and measures that mark the next major step in this Department’s reform agenda.

First, I will provide an update on our efforts – within the military services, and in the Department as a whole – to generate efficiency savings by reducing overhead costs, improving business practices, or culling excess or troubled programs.

Second, I’ll summarize the substantial investments that the military departments will be able to make in high priority capabilities and programs –investments made possible by the savings identified by the service leadership;

And third, I will describe how these reform efforts – if followed through to completion – will make it possible to protect the U.S. military’s size, reach and fighting strength despite a declining rate of growth – and eventual flattening – of the defense budget over the next five years.

I believe it important to present all of these interconnected changes in full and in context, so my opening remarks will be long. And I want to thank you and Admiral Mullen for your patience in advance. Copies of this statement will be passed out following the briefing.

At the outset, I want to emphasize that while America is at war and confronts a range of future security threats, it is important to not repeat the mistakes of the past by making drastic and ill-conceived cuts to the overall defense budget. At the same time, it is imperative for this department to eliminate wasteful, excessive, and unneeded spending. To do everything we can to make every defense dollar count.

As a reminder, over the last two defense budgets submitted by President Obama, we have reformed and rebalanced the department’s spending habits and priorities, curtailing or cancelling troubled or excess programs that would have cost more than $300 billion if seen through to completion. At the same time, we increased investments in proven capabilities most relevant both to the current wars and to the most likely and lethal future threats. This follows the overall approach to budgeting set by the President: use precious taxpayer dollars to invest in key priorities critical to the core mission while cutting or reforming programs that are outdated, duplicative, or ineffective.

At this point, I should note the failure of the Congress to pass a defense appropriations bill for Fiscal Year 2011. Operating at significantly reduced funding levels under a continuing full year resolution would cause this department severe problems, likely requiring us to curtail critical activities needed to support our troops and carry out our national security mission.

Last spring, in recognition of the fiscal pressures the country is facing, we launched a comprehensive effort to reduce the department’s overhead expenditures. The goal was – and is – to sustain the U.S. military’s size and strength over the long term by reinvesting those efficiency savings in force structure and other key combat capabilities.

The military services were instructed to find at least $100 billion in savings that they could keep and shift to higher priority programs. Under Secretary Ash Carter also launched an effort to get better value and results in the contracting arena for defense goods and services.

Then in August, I announced a set of initiatives aimed at reducing overhead costs and improving efficiency across the department as a whole – with special attention to the massive headquarters and support bureaucracies outside the four military services.

First, the military department savings.

To achieve the savings targets set last year, the uniformed service leadership conducted a thorough and vigorous scrub of our military’s bureaucratic structures, business practices, modernization programs, civilian and military personnel levels, and associated overhead costs – identifying savings that totaled approximately $100 billion over five years.

The Air Force proposed efficiencies measures that will total some $34 billion over five years. Among those proposals are:

Consolidating two air operations centers in the U.S. and two in Europe;
Consolidating three numbered Air Force staffs;
Saving $500 million by reducing fuel and energy consumption within the Air Mobility Command;
Improving depot and supply chain business processes to sustain weapons systems, thus improving readiness at lower cost; and
Reducing the cost of communications infrastructure by 25 percent.
The Army proposed $29 billion in savings over the five years. These include:

Reducing manning by more than 1,000 civilian and military positions by eliminating unneeded task forces and consolidating six installation management commands into four;
Saving $1.4 billion in military construction costs by sustaining existing facilities; and
Beginning consolidating the service’s email infrastructure and data centers, which should save $500 million over five years.
The Department of the Navy proposed savings of more than $35 billion over five years. Those measures include:

Reducing manpower ashore and reassigning 6,000 personnel to operational missions at sea;
Using multi-year procurement to save more than $1.3 billion on the purchase of new airborne surveillance, jamming, and fighter aircraft;
Disestablishing staffs for submarine, patrol aircraft, and the destroyer-squadrons plus one carrier strike group staff. Read the rest