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B-168700 1 (1973-11-27)

handle is hein.gao/gaobaafut0001 and id is 1 raw text is: 



              COMPTROLLER GENERAL OF THE UNITED STATES  09601S
                       WASHINGTON, D.C. 20548



B-168700
                                                NOV 2 7 1973


The Honorable Adlai E. Stevenson, III        //11/5,/
United States SenateLM905

Dear Senator Stevenson:

     Your May 14,,1973, letter requested us to review the
Department of the Navy's proposed plan to merge its
Electronics Supply, Offi.ce (ESQ_, Great Lakes, Illinois, with

Pennsylvania. In a subsequent meeting at your office, we
agreed to specifically consider the following questions in
our review.

     --Did the Navy consider all pertinent costs, such as
       severance pay and moving expenses, in its estimate of
       savings to be realized by the merger?

     --Did the Navy consider letting ESO absorb the positions
       to be eliminated?

     --Can there be savings if, at a later date, the Navy adds
       at SPCC the positions eliminated at ESO?

     --Will current efficient interface with suppliers be af-
       fected?

     --Are management functions similar enough so that SPCC
       can absorb items being transferred from ESO?

     --Will the cost to manage ESO items increase after trans-
       fer to SPCC?

     The Navy's decision to consolidate ESO with SPCC was not
based on formal cost-savings analysis. The Navy did develop
estimates of savings to be realized by the merger which were
prepared for planning purposes only. These estimates were
based on certain assumptions--the principal one being the elim-
inn-.o -3 O-persojnneipositions. Because of the lack ofE
documentation to support the Navy's assumptions, we cannot
precisely evaluate the overall effect of the proposed merger.






      ~C16 o I

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