Summary: GAO analyzed the $72 billion Defense budget increases in fiscal years 1981 and 1982, a 50-percent increase over the 1980 budget year. GAO also reviewed attempts to show how the Department of Defense (DOD) planned to use these funds and how they were spent.
GAO found that DOD generally followed through on its pledge to emphasize readiness and sustainability and to invest heavily in force modernization. It also increased military pay to recruit and retain critical skills and increased funding to the real property maintenance accounts to improve not only readiness, but also the quality of life for military personnel. However, the Administration had only limited success in eliminating marginal weapons programs to fund higher priority programs at more efficient production rates. Further, increases in operations and maintenance funds could have been spent more prudently. There is also a need for top managers in DOD to maintain visibility over how the funds are used. In the personnel area, DOD is using an across-the-board compensation approach to resolving skill shortage problems, rather than managing skill categories individually and tailoring pay and benefit packages to attract and keep sufficient people. Finally, DOD needs to add an accountability system or feedback loop to its Planning, Program and Budgeting System that would adequately inform top DOD officials and Congress on the progress made on major problems and projects. The major problem areas are: (1) providing more program stability; (2) adding to weapons systems support; (3) using the funds prudently; (4) defining objectives for use of funds; (5) maintaining program visibility; (6) obligating funds received late; (7) overcoming military skill imbalance problems; and (8) accountability over program execution.
