Aug. 6 (Bloomberg) -- The Pentagon is reducing to six days from 11 the furlough days that 651,542 of its civilian employees must take this fiscal year because of automatic budget cuts, Defense Secretary Chuck Hagel said.
“The military services have been aggressive in identifying ways to hold down costs, and we have been successful in shifting savings (including furlough savings) to meet our highest priority needs,” Hagel said today in a memo to service chiefs. He said some “modest improvements” in training and readiness also will be made.
The Defense Department has found $1 billion in savings it is using to reduce the unpaid leave, which is affecting 85 percent of civilian defense workers, according to a defense official who asked not to be identified discussing the budget details. Sources for the savings include money that Congress is allowing the Pentagon to reprogram, or shift, and costs of removing equipment from Afghanistan that have been less than expected, the official said.
The civilian furloughs, which started July 8, were intended to save $1.8 billion of $37 billion in defense budget cuts required through Sept. 30 under the automatic reductions called sequestration.
When Hagel announced plans for 11 days of furloughs in May, he said efforts would continue to reduce the number of days if possible. The 11 days, equal to one a week from July through September, was a reduction from earlier projections of 14 days to 22 days of unpaid leave.
On July 31, Hagel warned that Pentagon programs would have to absorb much deeper cuts if sequestration remains in effect, requiring reductions of at least $50 billion annually through 2023.
Outlining the results of a strategic review he ordered, Hagel told reporters that the Pentagon would have to choose between a decade-long “modernization holiday” and a “much smaller” force.
Charts shown to congressional aides and defense analysts listed among potential cuts the cancellation of Lockheed Martin Corp.’s F-35 fighter, the costliest weapons system, as well as the Air Force’s plans for a new long-range bomber.
Military leaders indicated they’re inclined to protect the development of new weapons capabilities at the cost of accepting much smaller forces if it comes to that.
“We will edge slightly probably toward capability, because we have to keep our industrial base alive, we have to keep focusing on new technologies,” Admiral James Winnefeld, vice chairman of the Joint Chiefs of Staff, told reporters last week.
Hagel also is looking at pay and benefits for troops, directing Army General Martin Dempsey, chairman of the Joint Chiefs of Staff, to lead a study examining how to save $50 billion in personnel costs over the next decade. He acknowledged Congress has opposed such cuts in the past.
Options for savings include requiring military retirees to make more use of private health insurance, having troops pay more toward housing costs, reducing cost-of-living adjustments for troops stationed overseas and continuing to limit military and civilian pay raises, Hagel said.
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