WASHINGTON, DC - An approaching deadline of October 1 will help signal whether the Department of Defense is serious about reducing inefficiency in defense agencies known as the Fourth Estate. Reforms mandated by Congress in the FY19 National Defense Authorization Act require DOD to achieve 25% savings from civilian management, logistics management, services contracting, and real estate management. The Department is required to report to Congress by October 1 whether such reforms will create inefficiencies or other problems.
The Pentagon was also required to produce a plan for achieving the savings in the covered activities by February 1, 2019. DOD missed that deadline, and both GAO and Ranking Member Thornberry found that report, when finally produced, inadequate.
Rep. Mac Thornberry (R-TX), Ranking Member of the House Armed Services Committee, made the following statement ahead of the October 1st deadline:
“We cannot have an agile, efficient, and lethal 21st century military if it is weighed down by 20th century business systems and practices. That is why it is so important that we keep Fourth Estate reforms on track. As I have said before, I am not confident that the Pentagon’s initial reform plan is sufficient to find 25% cost savings across these operations. I am encouraged by Secretary Esper’s focus on this important area of reform. Congress intended the October 1st deadline as an opportunity for DOD to warn us of potential unintended consequences of this effort. If they miss the deadline, I will assume that they are on track to achieve the required savings by the end of this year.”
As Chairman of the House Armed Services Committee, Rep. Thornberry initiated Fourth Estate reform in the FY19 National Defense Authorization Act. He introduced additional measures in the FY20 NDAA designed to keep Fourth Estate reform on time and accountable. “Fourth Estate” refers to thirty defense agencies and field activities which account for approximately 20% of DOD’s budget and 25% of the workforce and have enormous influence on day-to-day operations in the military.
Thornberry’s reforms required the DOD Chief Management Officer to reform enterprise business operations through reductions, eliminations, and improvements in these agencies to achieve no less than 25% savings across department wide civilian management, logistics management, services contracting, and real estate management activities by Fiscal Year 2021.
Thornberry introduced the Continuing Acquisition Reform Act in May of this year to help keep Fourth Estate reforms on track. His proposal limits funding for the DOD Chief Management Officer if future report deadlines are missed.