Threatened delay in defense budget adds to planners’ uncertainty

Pentagon spokesmen’s recent allusions to possible delays in the fiscal 2014 defense budget have added to the fog of uncertainty surrounding planning for the government’s largest spending category, according to analysts.

Defense Department Comptroller Robert Hale on Monday told a panel discussion at the Brookings Institution that “some delay is almost inevitable” given the changes in deadlines and spending cuts under a possible sequestration made through the American Taxpayer Relief Act that Congress passed New Year’s Day. “We are transmitting to the Office of Management and Budget right now,” Hale said. Any delay in the traditional early February budget release “will be OMB’s call.”

On Jan. 3 Pentagon spokesman George Little told reporters, “I think we could submit a budget in February. I'm not ruling that out. But we need to define what the timeline is in the coming days and weeks.” He added that “this is what happens when you don't have a rational debate on the federal budget.”

OMB did not respond to requests for comment.

Under the new law, the automatic across-the-board cuts that would be forced if Congress fails to enact a new deficit-reducing spending plan would trim the Pentagon’s fiscal 2013 budget by roughly $45 billion, or 9 percent of the budget, Hale said. That compares with 12 percent of the budget under the earlier scope of sequestration, though, like all departments, Defense would have fewer months to make the cuts.

“The fiscal cliff bill made for some further reductions,” Hale noted, “but the national security challenges haven’t gotten any less complex. It’s hard to plan. We would be better served if Congress had adopted and stayed with a stable budget plan,” he said, adding that he personally had coordinated four government shut-down drills in recent years while working under two long-term continuing resolutions from Congress. “It really hogties the department and its ability to manage with a number of legal restrictions,” he said.

In implementing Defense’s year-old strategic road map, Hale said, the department is prepared for further cuts as Congress maneuvers around the March expiration of the continuing resolution, the need to raise the debt ceiling and looming sequestration.

“We definitely need more stability in the budget size and particularly the budget process,” he said, also stressing the need for an overarching strategy and a continuing discipline to do more with less. “I have never seen a period of greater budget uncertainty. It gives a whole new meaning to March Madness.”

Though the department has not delved to the level of detail concerning the 2,500 Pentagon projects that might be disrupted under sequestration’s indiscriminate cuts, Hale said, if Congress gives his planners a dollar figure and authority to make choices, the cuts would most likely come first in the areas of long-term investment rather than in wartime operations.

Todd Harrison, a senior fellow at the Center for Strategic and Budgetary Assessments, told Government Executive that the recent deal to avert the fiscal cliff reduced the Pentagon’s fiscal 2014 budget cap by $4 billion, which will require adjustments. “It seems to make sense for DoD and the rest of the federal government to delay submission perhaps until March or as late as April,” he said. “It’s hard to cut at the end of the budget cycle when DoD has already finished its budget and is awaiting the passback from OMB,” he added. It’s not feasible at this stage to fundamentally rework the force structure or acquisition programs, he said. So instead of “revolutionary changes, it will probably be $4 billion of nip and tuck.”

Anthony Cordesman, a national security strategist at the Center for Strategic and International Studies, said the Pentagon’s new budget situation is “problematic because the fiscal 2014 submission interacts with the uncertainty of the fiscal 2013 budget and the legacy of former Secretary Robert Gates. If we’re going to create any stable programming structure, we need some baseline for both fiscal ‘13 and ’14,” he said.

“You also need things clarified as to what are the priorities under the new strategy,” Cordesman said. The fiscal 2014 budget must factor in what is happening on the ground in Afghanistan and what the U.S. presence and capability should be in that war-torn country. It must also reflect the shift in focus to Asia and the changing Middle East, he said. “For anyone actually in government or the defense industry, they are asking 'What do you do, what do you think you’re planning for?' ”

Congress has created a typically untenable situation, according to Winslow Wheeler, director of the Straus Military Reform Project at the Project on Government Oversight. “With all the things to hold Congress in contempt for, the persistent refusal to pass appropriations bills on time, especially for defense, ranks high,” he said. “Annual appropriations for the national defense is a constitutional requirement that both Democrats and Republicans slip by -- technically -- with continuing resolutions worded in a way to maintain Congress' pretense at controlling money rather than a minimal amount necessary. This disgrace has now become routine. Both political parties are responsible.”