DOD Releases Defense Reviews, 2011 Budget Proposal, and 2010 War Funding Supplemental Request
Filed under: Department of Defense, Syndicated Industry News
Department of Defense
February 1, 2010
President Barack Obama today sent to Congress a proposed defense budget of $708 billion for fiscal 2011. The budget request for the Department of Defense (DoD) includes $549 billion in discretionary budget authority to fund base defense programs and $159 billion to support overseas contingency operations (OCO), primarily in Afghanistan and Iraq. This proposal continues the reform agenda established in last year's DoD budget request and builds on the initiatives identified by the 2010 Quadrennial Defense Review (QDR) and 2010 Ballistic Missile Defense Review (BMDR).
The QDR examines DoD strategies and priorities. It assesses the threats and challenges that the nation faces and re-balances DoD’s strategies, capabilities, and forces to ensure the U.S. military has the flexibility to address today’s conflicts and tomorrow’s threats. The BMDR evaluates the ballistic missile threat to the U.S. and its allies and articulates policy. It determines the appropriate role of ballistic missile defense in the country’s national security and military strategies.
“The fiscal 2011 budget request builds on the reforms begun in last year's defense budget,” said Defense Secretary Robert Gates. “These substantial changes to allocate defense dollars more wisely and reform the department’s processes were broadened and deepened by the analysis and conclusions contained in the Quadrennial Defense Review.”
The fiscal 2011 base budget request represents an increase of $18 billion over the $531 billion enacted for fiscal 2010. This is an increase of 3.4 percent, or 1.8 percent real growth after adjusting for inflation. The DoD needs modest real growth to maintain, train, and equip the forces that sustain our wartime efforts.
The fiscal 2011 OCO request will provide additional resources needed to sustain U.S. forces in Operation Enduring Freedom – in Afghanistan and elsewhere – and Operation Iraqi Freedom. Included are funds for pay and benefits, logistics and other support, force protection, continuing efforts to counteract improvised explosive devices, as well as funding to fully support the buildup in Afghanistan and to carry out a responsible drawdown in Iraq.
“The choices made and priorities set in these budget requests and strategic defense reviews reflect America's commitment to succeed in the wars we are in while making the investments necessary to prepare for threats on or beyond the horizon,” said Gates.
Also accompanying the 2011 budget proposal is a fiscal 2010 supplemental request of $33 billion to support the added costs of the President's new strategy in Afghanistan and strengthen U.S. force levels with approximately 30,000 additional troops.
“To make sure we have the resources needed to support our troops deploying to the Afghanistan theater, I will be asking the Congress to enact the supplemental by spring 2010,” said Gates.
Key highlights of the proposed DoD budget are outlined in the attached summary and charts. For more information and to view the entire fiscal 2011 budget proposal, please visit http://www.budget.mil and download the "FY 2011 Budget Request Overview Book."
The 2010 QDR and BMDR are available online at www.defense.gov/DefenseReviews.
Transcripts from applicable budget and strategic defense review briefings can also be viewed at www.defense.gov/transcripts.
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Defense budget, Department of Defense (DoD), Quadrennial Defense Review (QDR)
Editorial: Response to Reuters article, “UPDATE 1-Gates sees new US bomber fielded in 2020s”
Editorial: Response to Reuters article, "UPDATE 1-Gates sees new US bomber fielded in 2020s"February 2, 2010
The decision to move back this program primarily reflects a need to take some of the heat out of the overall acquisition budget 'bow wave'.
A secondary, though not unimportant consideration is the continuing debate over manned versus unmanned platforms for dangerous missions such as deep-strike and SEAD - for which unmanned platforms could increasingly play a substantial role.
Thirdly the B-52 has been flying for near six decades which means the 1970s and 1980s vintage B-1 and B-2 bombers can be flown for sometime yet.
That said, military requirements and defense budget politics at some point run up against the industrial reality of the cost of maintaining design teams plus that not unimportant issue - people retire one day - maintenance of skills and knowledge have a cost all of their own.
Technorati Tags:
Defense budget, Editorial, USAF (US Air Force)
Current Trends In Defense Spending To Continue
The 2011 defense budget released yesterday remains a "status quo" budget. It has an overall increase in defense spending as part of the largest...Leaking When It Is In Your Favor On The Defense Budget
Last year the Obama Administration worked hard to keep details of the defense budget from becoming public. This helped them get most of what they...KC-X Tanker RFP Out In February
Filed under: Boeing, Congress, EADS, KC-X, KC-X Tanker News, Northrop Grumman Corp.
At a recent press availability the U.S. Air Force Chief of Staff, General Schwartz, said that he expects the final RFP for the KC-X contest to be released next month. He also stated that it will be little changed from the draft RFP. Both Northrop (NOC) and Boeing (BA) have been submitting questions and comments on the draft RFP and some of these will be addressed in the final one. The RFP will be released a few weeks after the 2011 Defense Budget goes to Congress which is planned for 2 February.
Schwarz did say that the final RFP may have changes based on recent comments by Northrop and its partner EADS (EADS:P) that they might not participate as they felt the RFP favored Boeing too much. Both groups had also commented on the use of a fixed price development contract and how it transferred too much risk to the contractor from the Government.
England Awards Initial Contract For Combined Training Site
Filed under: Business Line, Companies, Contract Awards, Countries, England, Events, QinetiQ, logistics, training
The English government has ambitious plans to not only centralize their technical training but also privatize it. The goal is to save money within the defense budget. The consortium that is planned to construct and operate the new training site was awarded an initial contract worth almost $60 million to begin site preparation. The Metrix consortium which includes the British company QinetiQ will use this contract to move an existing Royal Air Force (RAF) school and begin demolition of existing buildings. Eventually the total program will be worth billions as the schools are established and classes taught.
The idea is fairly novel and controversial. In the United States for example they are moving away from contractor provided services by insourcing positions to civil service. They believe that this will save money in the long run. It will be interesting to compare how these two different paths work out over the next few decades.
DoD Continues Investment In WMD Sensors
Filed under: Business Line, Companies, Contract Awards, Department of Defense, Events, SBIR, Services, States, Wisconsin, development program
The 2010 defense budget just signed last month includes further funding for Platypus Technologies to continue their research and development of a sensor for chemical and biological weapons based on liquid crystals. The value of this contract which lasts one year is about $2 million. Platypus is one of the leading innovators in the use of this LCD technology for uses such as this. The goal is to have a hand held sensor that changes color or intensity based on what it detects.
Since Desert Storm in 1991 the U.S. military has been working hard to develop systems that detect chemical and other Weapons of Mass Destruction (WMD) from a distance and more safely then the traditional swipe systems used for most of the last century. They have built ones based on lasers that can be vehicle mounted. This idea would work in the open air. Platypus needs to build a system that controls for variables like temperature and humidity while being able to detect trace amounts of gases and biological matter. This is what this research is focusing on. The company had previously received funding through the Defense Department’s Small Innovative Business Research (SBIR) program.
U.S. Army Moves Out on Future Combat Systems (FCS) Replacement
Filed under: Boeing, Business Line, Companies, Congress, Contract Awards, Department of Defense, Events, Federal Budget Process, Restructuring, SAIC, Services, U.S. Army, development program
One of the major budget decisions of the Obama Administration was to end the U.S. Army’s Future Combat Systems (FCS) program. This overarching system-of-systems was to provide new vehicles, weapons, unmanned vehicles and data links to provide a rapid, hard hitting replacement for the heavy armored force built around the M1 tank and the M2 Bradley fighting vehicles. The FCS had seen major growth in cost and schedule and it’s requirements pre-dated operations in Iraq and Afghanistan. The administration decided to end the program. Boeing (BA) and SAIC (SAIC) were the prime contractors on it.
To replace FCS the Army stood up a Brigade Modernization Program that would take parts of the old program and also begin development of new requirements and vehicles. With the passage of the 2010 defense budget last week the Army took the first step by awarding Boeing a contract for initialization of Increment 1 of the new program. This contract is to provide the soldier on the ground enhanced surveillance, reconnaissance and intelligence capabilities. Increment 1 will include some unmanned ground and air vehicles as well as sensors and a network to integrate them.
Further increments of the program will see further investment in new vehicles and weapons designed to the new requirements.
C-17 Continues To Provide For Boeing
With the passage of the 2010 defense budget Boeing (BA) is assured of further production of the C-17 transport. Despite the wishes of the Obama...2010 Defense Budget Full Of Adds And Add Ons
President Obama signed the defense budget this past weekend which includes about $630 billion in funding. Much of this is for Congressional...Albania Buys Eurocopters
Filed under: Business Line, Companies, Contract Awards, Countries, EADS, Events, Military Aviation, logistics, production program
The former Eastern European satellite countries of the Soviet Union have made a hodgepodge of strides over the last twenty years to a more modern military. Some of the more Western ones like Czech Republic and Hungary have begun buying NATO standard weapons and equipment. Others due to their poor economies and situations have not been able to do much.
It was announced yesterday that Albania which is one of the poorest countries in Europe will spend what must be a significant portion of their defense budget on five Eurocopter aircraft. The Cougar medium transports will be delivered in about three years at a cost of almost $100 million. They will represent a major upgrade over what old and less capable Russian Mil aircraft.
The market in this part of Europe had been hoped to be a big one for U.S. and European defense contractors. Unfortunately the global recession along with economic and political problems has limited the amount of funds available to be spent on new weapons. Perhaps as NATO continues its expansion and the world’s economy picks up there will be more orders like this.
Good News For Boeing And Lockheed Martin In 2010 Defense Funding Bill
The details of the 2010 defense budget are emerging and like most years there are several compromises. These may conflict with the desires of the...Canada Finds War Expensive
Canada's defense budget has been growing due to its support of operations in Afghanistan. At the same time the country is investing money in...No Surprise Personnel Costs Eating Defense Budget Which Affects Buying Hardware
The U.S.defense budget is steadily seeing personnel costs grow to be the biggest part of it. That means without cutting back on people there will...F-35 Program Has Issues DCMA Says
Filed under: Boeing, Business Line, Companies, Congress, Department of Defense, Events, Federal Budget Process, Lockheed Martin, Military Aviation, Restructuring, Services, U.S. Air Force, U.S. Marine Corps, U.S. Navy, development program, production program
The F-35 Joint Strike Fighter (JSF) has become the aviation program in the Obama defense budget. This multi-variant, multi-service aircraft will be the only new tactical aircraft built in the United States for several years now that the F-22 Raptor was canceled in the 2010 budget. In fact Secretary of Defense Robert Gates wanted to speed up production and testing of the aircraft in order to replace the aging F-15 and F-16 fleet more quickly.
Earlier this summer there were reports that a review panel had found the potential for delays and cost growth in the program that would seriously affect the plans for the aircraft. Yesterday there were reports that the Defense Contract Management Agency (DCMA) has been reporting that the program is facing production and test delays as well as having cost issues. DCMA monitors contractors for performance and delivery and reportedly Lockheed Martin and its supporting contractors are already behind on the latest schedule established in May, 2008.
When the budget was announced with the decision to cancel the F-22 and focus on the F-35 some doubts were raised that the plan would work out. The schedule was not firm enough and cost was still being worked out for the three different aircraft being developed for the U.S. and its Allies. The F-35 if unit costs do rise significantly could see lower annual buy quantities which stretches out production and extends the time the older aircraft must be flying. While it is certainly possible that the schedule problems may be overcome delays and cost increases will undermine the reasoning behind the whole proposed Obama aviation modernization budget. This report may give Congress pause and interest in re-starting the F-22 production.
U.S. Department of Defense Invests In Prostrate Cancer Treatment
Filed under: Business Line, Companies, Congress, Contract Awards, Department of Defense, Events, Federal Budget Process, S&T, SRI International, Services, development program
The U.S. Department of Defense/Prostrate Cancer Research Program (DoD/PCRP) gave a grant of just over $1.5 million dollars to SRI International to support pre-clinical studies of the non-profit organization’s agents that might be able to develop into drugs to treat prostate cancer. This grant follows an earlier one that had led to some positive results utilizing plant products.
The U.S. defense budget contains a great deal of novel R&D efforts and a lot of funding. Congress has used it to fund breast and other cancer and disease prevention and treatment research. Obviously the military has a great deal invested in their human capital and medical treatment and this funding helps in those areas. SRI International is a spin-off of Stanford University specializing in sponsored research for government, businesses and foundations.
War Of Words Continues On VH-71 With Lockheed In The Middle
The 2010 Defense budget bill approved by the House kept funding to use the existing VH-71 aircraft purchased under the canceled program while the...GE And Rolls Royce Must Wait To Hear On Second JSF Engine
The 2010 Defense Budget is almost done and one key issue to be worked out is whether to keep funding the second engine for the F-35. GE and Rolls...Boeing May See More C-17 Production
The Senate fought back an effort to end funding for the C-17 transport in the 2010 defense budget. If this stays in the additional aircraft will...Boeing May See More C-17 Production
The Senate fought back an effort to end funding for the C-17 transport in the 2010 defense budget. If this stays in the additional aircraft will...If Defense Acquistion Was Perfect
J. David Patterson formerly Comptroller for the Defense Department and the head of one of many past commissions looking at ways to improve defense acquisition programs with an idea of saving money in the defense budget. It was published in the Federal Times yesterday. In this article he makes the good point that [...]English Defense Industry Looking Bleak
Filed under: BAE Systems, Business Line, Companies, Contract Awards, Countries, Department of Defense, England, Events, Military Aviation, Scotland, Services, VT Group, production program
It is true that the United States defense budget does dominate the world’s spending on arms and equipment but the U.K. has always had large spending plans as well. Now that the U.K. government of Gordon Brown is facing massive deficits due to social spending and attempts at stimulating their own economy since the global recession began twelve months or so ago defence spending may get a little tight. There has already been discussion of canceling some large programs as well as cutting back on general spending. Like in the U.S. ending these kind of programs will lead to more job losses on top of those already gone in the civilian economy.
That is why stories like this one about the U.S. military buying BAE Systems artillery pieces that will be made in the U.K. will become more common. When you are relying on foriegn sales to keep up jobs for six months at a time it is not a good sign. There are bigger programs at risk for the U.K. such as the Eurofighter or A400M transports. The government is scrambling to maintain the new aircraft carrier contract as the jobs at Scottish shipyards are key to that part of the nation’s economy.
There is no doubt that the U.S. will also see a fall in defense spending as the pressures of debt, health care reform and other priorities will limit the money available from the Obama Administration’s budget.
FCS Cancellation Fallout
Filed under: Boeing, Business Line, Companies, Congress, Events, Federal Budget Process, IT, Restructuring, SAIC, Services, U.S. Army, development program, logistics, production program
The cancellation of the current Future Combat Systems (FCS) development contract was one of the cornerstones of the Obama Administrations 2010 defense budget. The program of new vehicles, unmanned aerial and ground systems, and the data links connecting them was estimated at over $160 billion. The Army still has a requirement for a upgrade to their combat brigades currently using the Eighties produced M1/M2 vehicles and the Styker Interim system. As such a new program was set up to replace FCS almost immediately after the contract with Boeing and SAIC was canceled.
Now the Army is concerned that the money planned for in the budget may not be available for this new program. At a minimum some of it will be needed to pay the termination fees related to the various contracts ended prematurely. They were ended at the convenience of the government so the contractors are entitled to payment for whatever work they had done and what it takes to close out the contracts. If the money doesn’t remain in the FCS line then the Army will be forced to fund it from other programs.
Congress in their mark up of the 2010 budget cut most of the money budgeted for this as they felt there were sufficient current funds to cover this. This may be a little too much penny save pound foolish. The Army knows fairly well what is needed and probably budgeted appropriately. The cost to other parts of the Army including the new modernization program may be quite high.
Lockheed Plans Further Job Cuts Due To VH-71 Ending
Filed under: Business Line, Companies, Congress, Countries, Department of Defense, Events, Federal Budget Process, Finemeccanica, Italy, Lockheed Martin, Military Aviation, New York, Restructuring, Services, States, Suspensions, U.S. Marine Corps, U.S. Navy, development program, production program
Lockheed Martin had already cut over one hundred jobs at their Upstate New York facility in Owego. This was mainly due to the decision by Obama and Secretary of Defense Gates to end the VH-71 New Presidential Transport helicopter program. Even though the aircraft was made in Italy Lockheed did all the modifications and integration in Owego.
Despite a great deal of argument and pressure to keep the program going in some form or another the contract was recently terminated. Lockheed is now saying that another seven hundred and fifty people may lose their jobs. Right now they are looking for people to voluntarily leave or retire with a promise of severance. The plan is to begin the layoffs in July based on how many people agree to leave voluntarily.
One of the arguments against ending this and other production programs is that they will just add to the joblessness during the current recession. Of course the defense budget is not really a jobs program and that is fairly poor reasoning to continue spending billions of dollars on a system that does not meet requirements. It is still possible that Congress will pass some form of spending that will keep pieces of the program alive in the 2010 defense budget but that will not be finished until the Fall.
Northrop Tries To Save Kinetic Energy Interceptor
Filed under: Business Line, Companies, Congress, Department of Defense, Events, Federal Budget Process, MDA, Northrop Grumman Corp., Restructuring, S&T, Services, development program, missile defense
Update — On June 10th the Missile Defense Agency (MDA) terminated the Kinetic Energy Interceptor (KEI) for the convenience of the government. This meant that all of Northrop’s lobbying to continue the program to at least conducting the first key test in the program was wasted.
Moving quickly like he has on the FCS and VH-71 programs the Secretary of Defense Robert Gates had another stop work order issued for a program recommended for cancellation in the 2010 budget. MDA told Northrop Grumman to halt the KEI program. This $4 billion contract had only recently been issued and the first test flight of the propulsion system was planned for later this year.
Congress has shown a great deal of support for this program recently and the decision to end it was not well received. There was some concern expressed that the program had not been given a chance to demonstrate its capability. The total missile defense budget saw almost a twenty percent cut with this and the Ground Based Mid-Course system making up the bulk of that money. The plan is to focus on the Navy’s system as well as shorter ranged Army ones.
Northrop has proposed that even with the termination of the program they will still be able to meet schedule and complete the booster test. This may be an attempt to sway Congressional and Administration support for continuing the program beyond 30 September 2009. If they really can meet this test schedule and the history of missile defense programs is not in their favor due to the complexities of the tests and technology then it might help them carry the program over.
A Northrop Grumman video on the program is below which is kind of amusing as it is done as a fake newscast:
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