Condition of Some Selected Equipment Has Been Degraded by the High Pace of Operations and the Advanced Age or Complexity of the Systems

While the condition of the 30 equipment items we reviewed varied, we  found that average fleet-wide readiness rates for most of these items  declined between fiscal years 1999 and 2004. DOD is currently conducting a Quadrennial Defense  Review that will examine defense programs and policies and may change  some equipment requirements. In addition, the Marine Corps’ Medium Tactical Vehicle  Replacement vehicles are being aggressively used in support of operations  in Iraq, but also met their mission capable goals for fiscal years 2003 and  2004. Services Near- and Long-Term Program Strategies and Funding Plans Exist for Most Equipment Reviewed, but Some Gaps Remain

The military services have identified near- and long-term program  strategies and funding plans to ensure that most of the 30 selected  equipment items can meet defense requirements, but some gaps remain. For the 30 selected equipment items, we found that 20 of the services’ near- term program strategies have gaps in that they do not address capability  shortfalls, full funding is not included in DOD’s 2006 budget request, or  there are supply and maintenance issues that may affect near-term  readiness. DOD is required to  develop sustainment plans in 10 U.S.C. § 2437. Without developing complete near-term plans and identifying  the associated funding needs to ensure that all key equipment items can be  sustained and modernized—and assessing the risk involved if gaps in these  strategies are not addressed—DOD may be unable to meet some future  requirements for defense capabilities. We assessed 7 of the selected equipment  items as red, only 2 of which will be covered by this statute, because the  services’ program strategies and funding plans to meet long-term  requirements are not fully identified, studies to determine future system  requirements are not complete, funding for maintenance or technological  upgrades may not be available, or replacement systems were delayed or  not identified, and in some cases, the selected equipment items may be  unable to meet their long-term requirements. Moreover, DOD  faces challenges to sustain and modernize its current equipment while  continuing these operations and transforming to a new force structure. Recommendations

To ensure that DOD can sustain key equipment items to meet future  equipment requirements and to provide greater visibility over key  equipment items to Congress, we recommend that, after the department  completes its Quadrennial Defense Review, the Secretary of Defense, in  consultation with the Secretaries of the Military Services, take the  following two actions:   Reassess the near- and long-term program strategies for sustaining and  modernizing key equipment, particularly those items not covered by 10  U.S.C. Matter for Congressional Consideration

Congress should require the Secretary of Defense to report on program  strategies and funding plans to ensure that DOD’s budget decisions address  deficiencies related to key military equipment. The department is not currently  required to report sustainment plans for some of these critical items to  Congress. To select the 30 equipment items we reviewed, we included 18 of the  equipment items reviewed in our December 2003 report, and based upon  input from the military services, your offices, and our prior work, we  judgmentally selected an additional 12 items. )—does not apply to  existing systems for which a replacement system will reach initial  operational capability before October 1, 2008, we did not assess  compliance with this section of the act. The  increase in the goal occurred as B-1 usage to support operations in Iraq and  Afghanistan increased.
Why GAO Did This Study

With continued heavy military involvement in operations in Iraq and Afghanistan, the Department of Defense (DOD) is spending billions of dollars sustaining or replacing its inventory of key equipment items while also planning to spend billions of dollars to develop and procure new systems to transform the department's warfighting capabilities. GAO developed a red, yellow, green assessment framework to (1) assess the condition of 30 selected equipment items from across the four military services, and (2) determine the extent to which DOD has identified near- and long-term program strategies and funding plans to ensure that these items can meet defense requirements. GAO selected these items based on input from the military services, congressional committees, and our prior work. These 30 equipment items included 18 items that were first assessed in GAO's 2003 report.

What GAO Found

While the fleet-wide condition of the 30 equipment items GAO selected for review varied, GAO's analysis showed that reported readiness rates declined between fiscal years 1999 and 2004 for most of these items. The decline in readiness, which occurred more markedly in fiscal years 2003 and 2004, generally resulted from (1) the continued high use of equipment to support current operations and (2) maintenance issues caused by the advancing ages and complexity of the systems. Key equipment items--such as Army and Marine Corps trucks, combat vehicles, and rotary wing aircraft--have been used well beyond normal peacetime use during deployments in support of operations in Iraq and Afghanistan. DOD is currently performing its Quadrennial Defense Review, which will examine defense programs and policies for meeting future requirements. Until the department completes this review and ensures that condition issues for key equipment are addressed, DOD risks a continued decline in readiness trends, which could threaten its ability to continue meeting mission requirements. The military services have not fully identified near- and long-term program strategies and funding plans to ensure that all of the 30 selected equipment items can meet defense requirements. GAO found that, in some cases, the services' near-term program strategies have gaps in that they do not address capability shortfalls, funding is not included in DOD's 2006 budget request, or there are supply and maintenance issues that may affect near-term readiness. Additionally, the long-term program strategies and funding plans are incomplete for some of the equipment items GAO reviewed in that future requirements are not identified, studies are not completed, funding for maintenance and upgrades was limited, or replacement systems were delayed or not yet identified. Title 10 U.S.C. 2437 requires the military services to develop sustainment plans for equipment items when their replacement programs begin development, unless they will reach initial operating capability before October 2008. However, most of the systems that GAO assessed as red had issues severe enough to warrant immediate attention because of long-term strategy and funding issues, and were not covered by this law. As a result, DOD is not required to report sustainment plans for these critical items. For the next several years, funding to sustain or modernize aging equipment will have to compete with other DOD priorities, such as current operations, force structure changes, and replacement system acquisitions. Without developing complete sustainment and modernization plans and identifying funding needs for all priority equipment items, DOD may be unable to meet future requirements for defense capabilities. Furthermore, until DOD develops these plans, Congress will be unable to ensure that DOD's budget decisions address deficiencies related to key military equipment.