Proposed law to shed sunlight on DOD budget

A group of legislators is clamoring to hold the Defense Department more financially accountable and force it to conduct a full, successful audit – something the agency and its components so far have failed to do, according to a senator.

“By failing to pass an audit, the Pentagon has undermined our national security,” said Sen. Tom Coburn (R-.Okla.). “When the Pentagon can’t tell Congress, or itself, how it is spending money good programs face cuts along with wasteful programs, which is the situation in which we find ourselves today under sequestration.”

Introduced by lead sponsor Coburn and eight cosponsors, the bipartisan Audit the Pentagon Act would create new incentives and enforcement mechanisms to force the Pentagon to review its financial management, according to the office of Sen. Joe Manchin (D-W.Va.)

“We need to make sure that we’re using our limited resources in the best way possible to support the men and women in uniform,” said Manchin, one of the cosponsors. “One of best ways to do that is to shed light on the Department of Defense budget, without jeopardizing our national security secrets.”

First, the legislation would grant the Pentagon more power to reprogram funds without approval from Congress. Second, the Pentagon would also notify Congress about which reports are unnecessary, with the idea that it would save taxpayers dollars by slashing red tape.

The proposal would also establish new accountability mechanisms, including creating a chief management officer role with the responsibility to fix the Pentagon’s finances and IT issues. Also, the Defense Finance and Accounting Service would be transferred to Treasury Department in the event the Pentagon doesn’t pass an audit.

Bill cosponsor, Sen.  Kelly Ayotte (R-N.H.), said government spending must be scrutinized, particularly as the threat looms for the massive across-the board budget reductions slated to take effect early 2013.

“Every wasted defense dollar is a dollar we deprive our warfighters who protect our country," she said. "Furthermore, if defense sequestration cuts take effect in January, it will be even more critical for the Department of Defense to have reliable financial data."

Other cosponsors include Scott Brown (R-Mass.), John Cornyn (R-Texas), Chuck Grassley (R-Iowa), Ron Johnson (R-Wisc.), Claire McCaskill (D-Mo.) and Rand Paul (R-Ky.)

About the Author

Camille Tuutti is a former FCW staff writer who covered federal oversight and the workforce.

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Reader comments

Wed, Aug 8, 2012

As someone who works for DFAS preparing financial statements for audit, I can tell you that the major problem is the software that has been developed by the Services and Defense Agencies. Moving DFAS to Treasury will not improve the internal controls or the quality of the data. Like much of government, this appears to be a plan that when your last plan doesn't work, re-organize and blame it on the people before you (then be gone by the time your plan fails). The real solution is to take the software development away from the Services and Defense Agencies. Have one activity (maybe DFAS, maybe Treasury) write software for the entire DoD (with input from everyone) and force everyone to conform to the software.

Sat, Aug 4, 2012 DOR

There is no question that an audit is needed to help identify and fix inefficiencies. The problem with audits, however, is that they find issues after the fact and there is often little that can be done by the time the audit is complete because the money has been spent. What is desperately needed in addition to audits is for performance targets to be set and monitored real-time so that performance so that problems can be corrected proactively -- either the problems are fixed before waste occurs or the project is shut down as soon as it is clear that it can't meet its goals. As an example, if you took away basic performance metrics (such as profit & loss, margins, expenses, etc) from the most successful business, that business would falter over time because problems and waste always creep in when performance isn't monitored. It's unthinkable that an organization with the budget of the Defense Department doesn't have metrics to monitor its own performance. DOR (http://www.dofr.org) requires all government entities to establish performance metrics (Law-LEG) and to actively monitor those metrics (Law-DASH).

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