DOD memo provides specifics for Headquarters spending cuts

5 Aug 2013 | Cheryl Pellerin

Deputy Defense Secretary Ash Carter released a memo Aug, 1, that provides more specifics for a 20-percent reduction in Defense Department management headquarters spending over five fiscal years.

Defense Secretary Chuck Hagel announced the cuts during a July 16 meeting with employees at Naval Air Station Jacksonville in Florida.

The cuts, Carter said in the memo, will take place regardless of budget levels approved by Congress. Such cuts, he said, are designed to streamline DOD management through efficiencies and by eliminating lower-priority activities.

"This memorandum defines the nature of these important reductions more specifically," Carter said.

Headquarters cuts will apply to all higher headquarters staffs including Office of the Secretary of Defense principal staff assistants and their associated defense agency staffs, the Joint Staff, service secretary staffs, service chief staffs, service four-star major commands and service component commands, lower-level service staffs down to the level determined by service secretaries and chiefs, and combatant command staffs.

Intelligence staffs will be affected, the memo said, primarily military-intelligence-program-funded intelligence centers and, with the concurrence of the director for national intelligence, national-intelligence-program-funded centers.

Service secretaries and chiefs will decide the allocation of cuts among organizations within their headquarters staffs, the memo said.

The chairman of the Joint Chiefs will make the same allocation for the Joint Staff. Each principal staff assistant and defense agency should achieve a 20-percent reduction, the memo said.

"If necessary, I will consider reallocations during program review," Carter wrote in the memo.

The 20-percent spending cut applies to the total headquarters budgets, and these include government civilian personnel who work at headquarters, and associated costs such as contract services, facilities, information technology, and other areas that support headquarters functions.

Budgets are those specified in the Future Years Defense Program supporting the president's budget for fiscal year 2014, extended to fiscal 2019 assuming growth for inflation, according to the memo.

The 20-percent spending reduction applies to budget dollars, but organizations will strive for a goal of 20-percent reductions in authorized government civilian staff at their headquarters.

While military personnel are not part of headquarters budgets, organizations will strive for the goal of a 20-percent reduction in military personnel billets on headquarters staffs, the memo said.

Finally, subordinate headquarters should not grow as a result of reductions in higher headquarters. Carter noted in the memo that he'd review proposals to ensure that these various goals are met.

"I recognize that the [fiscal] 2014 budget reflects past efficiency decisions, some of which affected headquarters. This 20-percent reduction represents an additional cut, which I know will be challenging," Carter said in the memo.

"However, in this period of additional downward pressure on defense spending, we must continue to reduce our headquarters budgets and staffing," he added. "Components are encouraged to suggest changes in policies and workload that would help them accommodate these dollar and staff reductions."

Senior managers should ensure that cuts are made aggressively and as soon as possible, both to eliminate uncertainty for DOD employees and contractors and to maximize savings, the deputy secretary added.

Generally, cuts should be roughly proportional by year -- with about one-fifth of the cuts in fiscal 2015, another fifth in fiscal 2016, and so on up to fiscal 2019, the memo said, and components are free to implement reductions more rapidly.

To the extent feasible, some cuts should begin in fiscal 2014 to increase savings and reduce cuts required in later years, the memo said.

Carter directed that reduction plans be submitted along with Program Objective Memorandum submissions, which are due Sept. 23.

Headquarters Marine Corps