Army Braces for $25 Billion Cut

[Hasbeen]

ouch!

InsideDefense.com NewsStand | Jason Sherman and Jen DiMascio | April 20, 2006

The Defense Department is girding for a new round of fiscal belt tightening that could squeeze $25 billion from the Army across the Pentagon's new six-year spending plan and force the ground service for a second consecutive year to choose between significant cuts in the size of its forces and scaling back key equipment modernization programs.


Deputy Defense Secretary Gordon England earlier this month issued fiscal guidance directing all of the military services to scale back spending plans as they construct their fiscal years 2008 to 2013 spending plans, according to Defense Department officials who discussed the issue on condition they not be identified.

This fiscal direction will form the basis of spending plans in the coming months as the services and defense agencies build their FY-08/13 program objective memoranda. As details of the program take shape, senior Pentagon officials may appeal to the White House Office of Management and Budget for additional resources. OMB will set the ultimate size of the Pentagon's budget proposal for fiscal year 2008 in a “pass back” memo that is usually issued in November or December.

While all of the services are facing lower topline spending amounts than previously planned, Army officials are bracing for the most severe reductions, sources said.

The Pentagon's topline figures through the balance of its current five-year spending plan, according to a Congressional Budget Office analysis of the Pentagon's FY-07 budget submission, are $450 billion in FY-08; $461 billion in FY-09; $472 billion in FY-10 and $483 billion in FY-11.

The draft guidance slashes $17 billion in fiscal years 2012 and 2013 alone from the Army modularity program, a development that could sow chaos into the service's modernization plans, specifically to its planned procurement of the Future Combat System.

Army officials had expected the Office of the Secretary of Defense to continue assisting with paying for its modularity program in a manner consistent with the $25 billion windfall the service received last year for those efforts through FY-11. That support, sources said, now appears over.

While it is early in the process, Army officials are not happy with the prospect of new bills that come in addition to billions of dollars in pre-existing ones the ground service was still trying to figure out how to pay for, such as relocating Army forces around the world as part of the first wave of Global Posture Review decisions, as well as bills associated with implementing decisions of last year's Base Realignment and Closure Commission.

“If you're already drowning and somebody puts a brick in you rucksack, I guess it really doesn't make any difference,” said one Pentagon official. “The Army at the moment is drowning.”