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GAO-01-675R 1 (2001-05-22)

handle is hein.gao/gaocrptanjg0001 and id is 1 raw text is: SGAO Accountability * Integrity * Reliability United States General Accounting Office Washington, DC 20548 May 22, 2001 The Honorable James Inhofe Chairman The Honorable Daniel Akaka Ranking Member Subcommittee on Readiness and Management Support Committee on Armed Services United States Senate Subject: Defense Acquisitions: Nav and Marine Corps Pilot Program Initiatives to Reduce Total Ownership Costs The cost of operating and supporting the services' weapon systems is absorbing an increasing share of the defense budget and is reducing funds available for buying new systems. As a result, older weapons are being retained in the inventory longer, which further increases their operating and support costs. Operating and support costs include costs for fuel, repair parts, maintenance, and contract and support services, as well as for all civilian and military personnel associated with a weapon system. The Department of Defense (DOD) has set broad goals for lowering the operating and support costs of both weapon systems in development and those already fielded. The projected life-cycle costs for developmental systems are expected to be 20 to 50 percent less than the systems being replaced. The operating and support costs of fielded systems are expected to be reduced 20 percent by 2005. The Department has established baselines against which the programs can calculate progress and is monitoring progress through quarterly reports. In April 1998, DOD established an initiative that expanded program managers' responsibilities for designing and producing new weapon systems to include more accountability for the total ownership cost of the system, including its operating and support costs. Under this initiative, each service was to designate 10 programs as pilots to test innovative approaches to reduce total ownership costs, especially operating and support costs. GAO-01-675R Defense Acquisitions

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