Cost of Defense personnel reforms questioned

Bush administration and union officials disagree about the cost of implementing the Defense Department's pending personnel system.

The system, dubbed the National Security Personnel System, was first laid out in the Federal Register in February. The regulations proposed a system with performance-based pay and lessened collective bargaining powers for employees.

The American Federation of Government Employees, a union representing about 300,000 Defense employees, is now asking department officials to give specifics on just how much this personnel system will cost to implement.

"Despite the reams of paper outlining details and procedures under the proposed system," AFGE president John Gage said, "little information has been made available to the public on the costs associated with implementing the new system."

NSPS officials, however, said they have not received a request recently from AFGE concerning the price of the personnel system. They said the unions raised the issue in February, when the announcement was published and the Federal Register disclosed all the cost information.

According to that announcement, the department "estimates the overall costs associated with implementing the new DoD HR system-including the development of a system and the creation of the [National Security Labor Relations Board]-will be approximately $158 million through [fiscal] 2008. Less than $100 million will be spent during any 12-month period."

That answer, said Don Hale, president of the AFGE's Defense Conference, is too vague.

We "don't know how they came up with that figure or what that is going to encompass," Hale said.

According to NSPS spokeswoman Joyce Frank, the $158 million takes in the estimated costs for designing and implementing NSPS, including centralized program office operations, training design and delivery, program evaluation, modifications to human resources information systems, and establishment of a National Security Labor Relations Board.

AFGE leaders said the Homeland Security Department, which has a similar personnel system slated to roll out on Aug. 15, awarded a contract to Northrop Grumman Corp. for $175 million, more than NSPS' estimated total cost, "solely for the purpose of designing" the system, not implementing it.

"When has the design ever cost less than the final product?" asked Ron Ault, president of the AFL-CIO Metal Trades Department, arguing the cost of implementing the program will likely outweight the cost of design alone. Ault said estimating the Defense Department's cost based on DHS', it will "probably cost billions to implement."

While NSPS officials said they could not comment on DHS costs, they noted that the "Department of Defense has an existing, robust infrastructure for things like training and information systems, and our costs reflect that."

Hale called the $158 million figure "a bogus number."

"A full week of training for some supervisors, that's a big cost," Hale said. "Just a transfer of some of these job positions is going to be another task and is going to take up a lot of time and a lot of effort for people who are supposed to be doing other things."

The final personnel reform proposal should be published in the Federal Register in the fall, according to Frank.