ACQUISITION REFORM AT DoD

Ever since he came to the Senate, Senator Levin has been fighting to ensure that every dollar spent on national defense is spent wisely. That is why he led the effort to enact the Competition in Contracting Act in 1984. It is why he led the effort to eliminate billions of dollars of unneeded inventory from the Pentagon’s warehouses in the early 1990s. And it is why he led the effort to reform the Department of Defense’s (DoD) financial management systems, so that the Pentagon can accurately account for assets and expenditures and pay the right people the right amounts for products and services that they provide.

The struggle to reduce Pentagon waste is an unending one. In the mid-1980s, for example, Senator Levin learned that DoD was buying specially designed microchips at three to 10 times the market price of similar commercial products. He insisted that the DoD reduce paperwork requirements and rely more on commercially available microchips – resulting in taxpayer savings estimated at $500 million per year.

It wasn’t until 10 years later, however, that Congress was able to enact the federal Acquisition Streamlining Act and the Federal Acquisition Reform Act, institutionalizing the common-sense practice of purchasing commercially available products where they meet our defense needs.

Similarly, in the late-1990s, Senator Levin learned that the Pentagon was wasting hundreds of millions of dollars every year through ineffective management of more than $50 billion of contracts for services. Senator Levin led the effort to require the Department to open its contracts for services to competition, pay contractors based on their performance instead of the number of hours that they work, and institute more effective management controls. As a result of these reforms, almost $2 billion was saved in 2002 and 2003 alone.

Since that time, Senator Levin has played a key role enacting additional acquisition reform provisions that will:

• improve the management of DoD’s major defense acquisition programs by requiring the Department to establish more realistic and achievable cost and performance estimates and tightening oversight requirements for programs that are experiencing problematic cost growth;
• address deficiencies in the oversight and management of contracts for the reconstruction of Iraq by requiring the issuance of specific guidance and regulations to govern the conduct of contractors and enhance the safety of contractor employees in Iraq; and
• establish a new management structure to provide review and oversight for inter-agency contracting mechanisms that have been subject to frequent abuse in recent years; and
• establish new oversight and cost control mechanisms for the Department's purchases of computer and communications systems.

In Senator Levin’s view, we can never devote too much effort to instituting sound management practices and ensuring that our defense dollars are well spent. The taxpayers who send their hard-earned money to Washington deserve no less.