Intercepts

DOD's financial mess fund; Bad day out of the office; DOD's business improvements

DOD's Financial Mess Fund

The Defense Department is close to naming the vendor that will spearhead a massive effort to improve its tangled web of financial management systems. Although that $100 million effort is not under way, DOD already is requesting an additional $96 million for fiscal 2003.

Tina Jonas, DOD's deputy undersecretary of financial management, said that the new funds would enable DOD to continue the Herculean task of streamlining its hundreds of legacy applications. Specifically, the funds would be used to launch pilot programs using the newly created DOD financial management information technology architecture.

Jonas, who testified at a hearing March 13 on the abuse of government-issued purchase cards, told lawmakers that DOD would be able to better track waste, fraud and abuse as a result of improved financial management.

Meanwhile, the House Government Reform Committee's Government Efficiency, Financial Management and Intergovernmental Relations Subcommittee plans to hold a hearing on DOD's financial mess this week.

Bad Day Out of the Office

One guesses that the March 13 hearing on purchase cards was not the best day at the office for Deidre Lee, DOD's director of procurement, who took part in a panel of Defense officials.

Lee was raked over the coals for DOD's ongoing purchase card problems. A General Accounting Office official testified about one Navy employee who apparently charged his girlfriend's breast enlargement surgery on his government purchase card. Although the employee reimbursed the department, everyone agreed that the surgery was not a legitimate government expense.

So far, most of the purchase card problems have been at Navy facilities.

Toward the end of the hearing, Rep. Stephen Horn (R-Calif.) asked Lee whether she had discussed the issue with Navy Secretary Gordon England.

Lee said that her office had been in talks with John Young of "ATL," which drew an immediate response from Horn. "Cut the bureaucracy stuff. ATL?" Horn asked sharply.

Lee went on to explain that Young is director of acquisition, technology and logistics. Horn replied, "We are just people, but we know the rigmarole that tries to go past us. So stop the bureaucracy." Stovepipe is another word that irks him, he added.

You might say it was a "charged" exchange.

DOD's Business Improvements

A plan to create a one-stop virtual shop for IT hardware, software and selected services is among a group of initiatives that has received senior-level approval from DOD's Business Initiative Council.

A total of 18 initiatives received the OK from the council, which was created last year by Defense Secretary Donald Rumsfeld as part of his effort to improve business operations.

The list is the second group of projects that the council has approved. The first group was released in October 2001 and included support of DOD's effort to buy enterprisewide software licenses.

The savings from these projects are still being calculated, DOD officials said, but they anticipate that DOD will save more than $100 million per year due to the initiatives.

Furthermore, DOD officials said that the cost savings were only part of the benefits. If fully implemented, the projects will improve customer service and performance, streamline procedures and increase flexibility.

Most of the projects do not have a specific IT component, including one that calls for making an aggressive effort to close more than 400 contracts on which work is complete but that remain open for final administrative actions.

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