Cost for U.S. Weapons Programs Increased by $27 Billion Last Year

An F-35 fighter

Photographer: AP Photo/Lockheed Martin

The costs for 47 of the Pentagon’s top 78 weapons programs increased last year by a combined $27 billion, according to Congress’s watchdog agency.

“This undesirable cost performance shows the need for continued oversight” as “programs continue through the acquisition cycle,” the Government Accountability Office said in the draft of its annual report on weapons costs, which is scheduled for release this month.

Many of the programs that increased in cost did so by less than 5 percent, including a 1.3 percent increase for Lockheed Martin Corp.’s F-35 fighter, the most expensive U.S. weapons system. The F-35 program’s “costs have risen over the past year without any change in quantity, meaning it is paying more for the same amount of capability,” the GAO said.

The biggest increase was 146 percent for the WIN-T Increment 2 tactical communications network made by General Dynamics Corp., although that stemmed largely from the Army’s decision to buy 3,167 more units.

In another trouble sign cited in the GAO’s weapons appraisal, the average time to deliver initial combat capability for a system increased by more than a month to more than 29 months.

Pentagon spokeswoman Maureen Schumann said in an e-mail that the department’s acquisition officials are reviewing the draft by the GAO. “We will provide our comments for inclusion in the final report,” she said.

Reduced Costs

The net cost for the entire portfolio of 78 major weapons declined by $7.6 billion, to $1.44 trillion, due to about $34 billion in reduced costs for 31 of the programs. But that stemmed mostly from cutbacks in two systems, and “the overall cost decrease masks” negative trends, the GAO said.

About $8.9 billion was saved on the Littoral Combat Ship made in separate versions by Bethesda, Maryland-based Lockheed and Henderson Australia-based Austal Ltd., after the Pentagon decided to reduce a planned 52-ship program by 20.

Costs for Increment 3 of the WIN-T tactical voice, video and data network made by Falls Church, Virginia-based General Dynamics declined $11.8 billion because the military is buying fewer, and the latest version has reduced capabilities.

While the cost increases cited were relatively small, lawmakers may view them as a setback as the Pentagon enters the fifth year of its “Better Buying Power” campaign. The effort was launched in 2010 by Defense Secretary Robert Gates and Ashton Carter, who was then the Pentagon’s chief weapons buyer.

Inefficiencies Cited

Carter, now defense secretary, is trying to make the case to Congress that the Pentagon’s weapons accounts should be increased by $20.4 billion, or 13 percent adjusted for inflation, over this year’s level.

The GAO said that of the 47 programs with higher costs, 31 reported growth “due to inefficiencies,” accounting for $13 billion. Ten had increased quantities, adding $12 billion. Six programs had cost increases of about $2 billion, even though quantities were reduced.

“While real progress has been made” since 2010 toward acquisition reforms, “DoD still faces challenges” fully implementing them, the GAO said.

The net increase of more than a month in delivering initial warfighting capabilities to combat commanders was driven by delays of six months or more in 11 programs.

The Army’s Integrated Air and Missile Defense program, on which Northrop Grumman is the main contractor, reported a 21-month delay in achieving initial combat capability “due to challenges in software development,” according to the report.

The Navy reported that the contractor’s high-altitude drone would slip 11 months for a total delay of more than two years “due to issues with development and testing,” according to the GAO.

The Navy also reported that Lockheed’s Remote Minehunting System for the Littoral Combat Ship slipped an additional six months over the past year, adding to a delay of more than seven years.

(A previous version of this story had an incorrect figure for the net costs of the weapons reviewed.)

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