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WASHINGTON — Pentagon money watchers will get greater powers to crack down on new weapons heading for huge cost overruns and terminate the serious budget-busting programs under a bill Congress is sending to President Barack Obama.
The House passed the weapons acquisition overhaul bill 411-0 Thursday, a day after the Senate unanimously approved it. The two sides came together this week on a compromise bill, moving with unusual speed to meet a request by Obama to send him legislation before lawmakers leave for the Memorial Day recess.
No one was predicting exactly how much could be saved by tightening controls over Pentagon procurement practices. But lawmakers said that with multibillion-dollar cost overruns a common occurrence, the potential was there for huge financial rewards.
It offers "the opportunity to save literally hundreds and hundreds of billions of taxpayer dollars," said Rep. John McHugh of New York, top Republican on the House Armed Services Committee.
The Obama administration has emphasized the need to make Pentagon operations both more cost-efficient and more attuned to future combat needs. Defense Secretary Robert Gates has taken steps to halt or curtail weapons, such as the F-22 fighter, that are costing far more than originally expected or are behind schedule in development. The Pentagon has also announced plans to hire an additional 20,000 people to assess contracts and review acquisition programs.
"Too often," said Rep. Ike Skelton, D-Mo., chairman of the House Armed Services Committee, the system results in "too few weapons that cost us too much and arrive too late."
Senate Armed Services Committee Chairman Carl Levin, D-Mich., said the Pentagon persistently relies on unreasonable cost and schedule estimates, insists on unrealistic performance expectations and uses immature technology.
The bill creates a new director of independent cost assessment appointed by the president and subject to Senate confirmation. The director would report directly to the secretary of defense, removing layers of bureaucracy between those reviewing programs and top officials.
Early warning systems would be put in place to address cost problems before they get out of hand. There's required use of competitive prototyping so the Pentagon selects the best systems and proves they work before it starts building them.
There are also new requirements for competition throughout the process and steps to prevent contractor conflicts of interests.
The measure also strengthens a 1982 law that allows for the termination of programs with chronic cost or delay problems. Programs running 25 percent over the original baseline during development would have to get new approvals to proceed or be ended.
There would be a presumption of termination, said Levin, who sponsored the bill in the Senate with Sen. John McCain, R-Ariz.
"It is going to be a lot harder to jump that hurdle should programs be failing in the middle or costing a lot more or taking a lot longer," Levin said.
Lawmakers cited a recent congressional report finding that 96 major weapons systems are now running almost $300 billion over original cost estimates and are on average 22 months behind schedule.
"If we had not squandered that $300 billion," said Rep. Rob Andrews, D-N.J., a key sponsor, "we would have had enough to pay the salaries of the troops, the health benefits of the troops and their families, for more than two years."
Unlike past congressional responses to $600 hammers and other specific Pentagon spending abuses, "what we're here dealing with today are ways in which we can bring about reductions in spending for massive large weapon systems," said Rep. David Dreier, R-Calif.
The legislation deals specifically with major weapons systems, which comprise about 20 percent of total Pentagon acquisition spending. About one-third of annual Pentagon spending usually goes to weapons.
Levin said earlier that just two major weapons programs — the next-generation Joint Strike Fighter and the Future Combat System — are now running over budget by $80 billion, with an average unit cost now 40 percent above original estimates.
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The bill is S. 454.
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