	Background

The U.S. military has long used contractors to provide supplies and  services to deployed U.S. forces. Contractors are an integral part of DOD’s  operations, and DOD officials have stated that without a significant  increase in the department’s civilian and military workforce, DOD is likely  to continue to rely on contractors both in the United States and overseas  in support of future deployments. DOD Has Taken Some Steps to Institutionalize Operational Contract Support, though Challenges Remain

In response to congressional direction and GAO recommendations, DOD  has taken some actions to institutionalize operational contract support,  such as establishing a focal point to lead the department’s effort to  improve contingency contractor management and oversight at deployed  locations, issuing new guidance, and beginning to assess its reliance on  contractors. However, DOD still faces challenges in eight areas related to  operational contract support. (1) Developing guidance. DOD has yet to finalize joint policies  required by Congress in the National Defense Authorization Acts  for Fiscal Years 2007 and 2008. (2) Planning for contractors in ongoing operations. The  department has not fully planned for the use of contractors in  support of ongoing operations in Iraq and Afghanistan, although  some efforts are underway at the individual unit level. (3) Planning for contractors in future operations. DOD needs to  take additional actions to improve its planning for operational  contract support in future operations. For example, while DOD has  started to institutionalize operational contract support into  combatant commands’ operation plans, it has not yet made  significant progress. (4) Tracking contractor personnel. While DOD has developed a  system to collect data on contractors deployed with U.S. forces,  our reviews of this database have highlighted significant  shortcomings in its implementation in Iraq and Afghanistan. (5) Providing oversight personnel. DOD continues to face  challenges in providing an adequate number of personnel to  oversee and manage contractors in contingency operations, such  as Iraq and Afghanistan. (6) Training non-acquisition personnel. DOD faces challenges in  ensuring that non-acquisition personnel, such as unit commanders,  have been trained on how to work effectively with contractors in  contingency operations. (7) Screening contractor personnel. DOD has yet to develop a  departmentwide policy for screening the significant number of  local and third-country national contractor personnel who support  deployed U.S. forces. (8) Capturing lessons learned. DOD has not implemented previous  GAO recommendations to develop a departmentwide lessons  learned program to capture the department’s institutional  knowledge regarding all forms of contractor support to deployed  forces in order to facilitate a more effective working relationship  between contractors and the military. Given the contractor-related challenges DOD continues to face, a cultural  change is necessary to integrate operational contract support throughout  the department. Without such a change, DOD is likely to continue to face  these challenges in ongoing and future contingency operations. Some Departmentwide Steps Taken to Institutionalize Operational Contract Support

In October 2006, the Deputy Under Secretary of Defense for Logistics and  Materiel Readiness established the Office of the Assistant Deputy Under  Secretary of Defense (Program Support) to act as a focal point for leading  DOD’s efforts to improve contingency contractor management and  oversight at deployed locations. Identifying and Planning for Operational Contract Support Requirements in Current Operations

DOD guidance highlights the need to plan for operational contract support  early in an operation’s planning process, in part because of the challenges  associated with using contractors in contingencies. These challenges  include overseeing and managing contractors in contingency operations. However, in previous reports and testimonies we have noted that DOD has  not followed long-standing guidance on planning for operational contract  support. Our work continues to show that DOD has not fully planned for  the use of contractors in support of ongoing contingency operations in  Iraq and Afghanistan, although some efforts are under way at the  individual unit level. Data Collected by DOD’s System to Track Contractor Personnel in Iraq and Afghanistan Are Unreliable

In January 2007, DOD designated the Synchronized Pre-deployment and  Operational Tracker (SPOT) as its primary system for collecting data on  contractor personnel deployed with U.S. forces, and it directed the use of  a contract clause that requires contractor firms to enter personnel data for  contracts performed in Iraq and Afghanistan into this system. Our work has found, however, that DOD  frequently did not have a sufficient number of trained contracting and  oversight personnel to effectively manage and oversee its contracts. While we recognize the efforts DOD has under way to develop long-term  plans intended to address its personnel shortages, many of the problems  we have identified in the past continue. In  2006, we first reported on the challenges that DOD faced in ensuring that  contractor personnel had been thoroughly screened and vetted. We have previously recommended developing a departmentwide lessons  learned program to capture the experiences of military units that have  used logistics support contracts and establishing a focal point within the  Office of the Under Secretary of Defense for Acquisition, Technology and  Logistics, to lead and coordinate the implementation of the  departmentwide lessons learned program to collect and distribute the  department’s institutional knowledge regarding all forms of contractor  support to deployed forces. Concluding Observations

DOD has acknowledged that operational contract support plays an integral  role in contingency operations and that successful execution of  operational contract support requires significant planning and  management. While some efforts have been made within the department  and the individual services to improve the planning for and management of  contractors, these efforts do not fully work toward integrating operational  contract support throughout DOD. As we have discussed, many of the  operational contract support challenges the department continues to face  are long-standing and while the department has acknowledged many of  these challenges, and taken some actions, it has not systematically  addressed them.
Why GAO Did This Study

This testimony discusses the challenges the Department of Defense (DOD) faces in institutionalizing operational contract support throughout the department. The institutionalization of operational contract support includes planning for the use of contractors, training of military personnel on the use of contractor support, accurately tracking contractor use, and establishing measures to ensure that contractors are accountable. For decades, DOD has relied on contractors to support contingency operations and has long considered them a part of the total force. For example, in its 2006 Quadrennial Defense Review the department reiterated that contractors were part of a total force that includes active and reserve military components, civilians and contractors. Additionally, in 2008 the Deputy Under Secretary of Defense for Logistics and Materiel Readiness testified that the structure of the U.S. military had been adapted to an environment in which contractors were an important part of the force. Further, an Army commission chaired by Dr. Jacques Gansler acknowledged that contractors were a significant part of the military's total force. While DOD joint guidance recognizes contractors as part of its total workforce, we have previously reported that DOD has not yet developed a strategy for determining the appropriate mix of contractor and government personnel. In addition, we recently testified that several long-standing challenges have hindered DOD's ability to manage and oversee contractors at deployed locations. For example, DOD has not followed long-standing planning guidance, ensured that there is an adequate number of contract oversight and management personnel, and comprehensively trained non-acquisition personnel, such as military commanders. Since 1992, we have designated DOD contract management as a high-risk area, in part due to concerns over the adequacy of the department's acquisition and contract oversight workforce. As we have previously testified, many of the long-standing problems we have identified regarding managing and overseeing contractor support to deployed forces stem from DOD's reluctance to plan for contractors as an integral part of the total force. We have also testified that DOD's long-standing problems in managing and overseeing contractors at deployed locations make it difficult for the department to ensure that it is getting the services it needs on time and at a fair and reasonable price. We have found numerous instances where poor oversight and management of contractors have led to negative monetary and operational outcomes. As a result, since the advent of our work on contractor support to deployed forces in 1997, we have made numerous recommendations to improve DOD's management of contractors in deployed locations. While DOD has taken some actions to address these challenges, it has not addressed all of them, as I will discuss in further detail. statement today will focus on the extent to which DOD has institutionalized operational contract support. This statement is based on recently published reports and testimonies that examined planning for operational contract support and the department's efforts to manage and oversee contractors in Iraq and Afghanistan as well as our ongoing work involving operational contract support related issues in Iraq and Afghanistan.

What GAO Found

In response to congressional direction and GAO recommendations, DOD has taken some actions to institutionalize operational contract support, such as establishing a focal point to lead the department's effort to improve contingency contractor management and oversight at deployed locations, issuing new guidance, and beginning to assess its reliance on contractors. However, DOD still faces challenges in eight areas related to operational contract support. 1) Developing guidance. DOD has yet to finalize joint policies required by Congress in the National Defense Authorization Acts for Fiscal Years 2007 and 2008. 2) Planning for contractors in ongoing operations. The department has not fully planned for the use of contractors in support of ongoing operations in Iraq and Afghanistan, although some efforts are underway at the individual unit level. 3) Planning for contractors in future operations. DOD needs to take additional actions to improve its planning for operational contract support in future operations. For example, while DOD has started to institutionalize operational contract support into combatant commands' operation plans, it has not yet made significant progress. 4) Tracking contractor personnel. While DOD has developed a system to collect data on contractors deployed with U.S. forces, our reviews of this database have highlighted significant shortcomings in its implementation in Iraq and Afghanistan. 5) Providing oversight personnel. DOD continues to face challenges in providing an adequate number of personnel to oversee and manage contractors in contingency operations, such as Iraq and Afghanistan. 6) Training non-acquisition personnel. DOD faces challenges in ensuring that non-acquisition personnel, such as unit commanders, have been trained on how to work effectively with contractors in contingency operations. 7) Screening contractor personnel. DOD has yet to develop a departmentwide policy for screening the significant number of local and third-country national contractor personnel who support deployed U.S. forces. 8) Capturing lessons learned. DOD has not implemented previous GAO recommendations to develop a departmentwide lessons learned program to capture the department's institutional knowledge regarding all forms of contractor support to deployed forces in order to facilitate a more effective working relationship between contractors and the military. Given the contractor-related challenges DOD continues to face, a cultural change is necessary to integrate operational contract support throughout the department. Without such a change, DOD is likely to continue to face these challenges in ongoing and future contingency operations. DOD has acknowledged that operational contract support plays an integral role in contingency operations and that successful execution of operational contract support requires significant planning and management. While some efforts have been made within the department and the individual services to improve the planning for and management of contractors, these efforts do not fully work toward integrating operational contract support throughout DOD. As we have discussed, many of the operational contract support challenges the department continues to face are long-standing and while the department has acknowledged many of these challenges, and taken some actions, it has not systematically addressed them.