Summary: GAO discussed the Department of Defense's (DOD) High Dollar Spare Parts Breakout Program. GAO strongly supports the intent of the program, which is to improve DOD procurement of replenishment spare parts through greater use of competition or direct purchasing from manufacturers. However, GAO believes that improvements are needed to make the program more effective. Although the program has brought about some significant savings, more could be accomplished by strengthening program management. GAO has found that the bulk of the parts which it examined were being purchased without competition. In a recent review, GAO found a lack of aggression in determining whether prime contractors' restrictive legends on technical data were justified. Another review showed a lack of adequate policy and procedural requirements covering the receipt and acceptance of technical data. In addition, a shortage of personnel dedicated to the program seems to be inhibiting breakout efforts. A major difficulty associated with the program is identifying the actual manufacturer of a spare part, and effective procedures for such identification are lacking. Finally, a recent GAO review found that breakout reviews are performed too late in the life cycle of a weapons system. Waiting to apply the breakout process until the support responsibility passes to the designated logistic support activity can delay the breakout review for several years, depriving the Services of savings and other advantages. GAO stated that it would seem advisable to have the logistics support activities perform the initial breakout reviews on major components as soon as adequate information is available.
