Next month, the National Defense Industrial Association will publish
its list of “Top Issues” for 2002, representing the
broad concerns of the defense industrial base for the year ahead.
These issues will guide NDIA’s educational and lobbying efforts
during that period. With 2001 closing, below is a summary of progress
made in support of this year’s issues.
Issue 1: A National Security Strategy for the 21st Century
A decade of downsizing, decreased investments and increased commitments
has taken its toll on the nation’s military forces, resulting
in a decided mismatch between their capability and the national-security
strategy.
Challenges: Advocate to the new administration and Congress the
necessity of achieving a balance between national-security strategy
and resources needed to meet commitments.
Increase funding for missile defense, but not at the expense of
other defense priorities.
Actions: Provided NDIA’s “Top Issues” for 2001
to the presidential transition team, every member of Congress and
the Pentagon leadership.
Co-sponsored a speaker series with the National Defense University
Foundation to discuss issues—including funding—facing
the missile-defense community.
Results: The 2001 Quadrennial Defense Review (QDR) outlines a new
defense strategy designed to match potential threats with U.S. capabilities
and resources.
A $3.8 billion increase for missile defense for 2002.
A 2002 defense top-line budget increase of more than $30 billion.
Issue 2: Sustaining Modernization
Resource constraints have made it difficult to embark on a significant
transformation and recapitalization program.
Challenges: Increase the research and development budget, especially
the science and technology component.nGenerate additional modernization
funds through elimination of excess infrastructure.nBuild stability
into acquisition-program funding to allow industry to better anticipate
demands and needs.
Actions: Encouraged grassroots campaign to accelerate long-term
transformation efforts by focusing on increases in science and technology.
Strongly supported the department’s request for an additional
round of base realignment and closure (BRAC).
Advocated lengthening multi-year contracts from 5 to 10 years.
Results: The QDR established a baseline for science and technology
funding of 3 percent for future defense standing.nAn additional
BRAC round authorized in the Senate-passed 2002 defense authorization
bill.
The undersecretary secretary of defense for acquisition, technology
and logistics’ major goals highlighted achieving stability
in defense programs and multi-year procurement as a method of accomplishing
this goal.
Issue 3: Ensuring Readiness
Intense, frequent and realistic training, as well as efficient and
well-managed logistics, are necessary to ensure readiness.
Challenges: Joint operations, new technology and frequent deployments
all contribute to increased training complexity.
Growing constraints on live-fire training place a premium on enhancing
simulation-based training.
The logistics-support system is not as responsive to the warfighter
as it could be.
Actions: Devoted an entire issue of NDIA’s monthly magazine
to training, with a focus on simulation.
Advocated an increased emphasis on logistics support in acquisition.
Results: The QDR emphasizes the importance of joint wargaming and
simulation-based training and establishes minimum training requirements
for joint operations.
Army, Navy, Marines and Air Force all have increased emphasis on
simulation-based training.
The new Defense Planning Guidance requires performance-based logistics
for life-cycle support in major programs.
Issue 4: Implementing the “Revolution in Business Affairs”
Changes to laws and regulations are necessary to modernize the acquisition
process.
Challenges: Legislative efforts to block the use of commercial
outsourcing of services reduce efficiencies and cost savings.
Progress payments to defense contractors require increases to improve
cash flow.
Actions: Advocated regulatory changes affecting Inter-Service Support
Agreements (ISSAs) to enhance public-private competition.
Opposed legislative proposals to reduce the department’s
ability to outsource services and non-governmental functions.nSupported
legislation to require a review of commercial-type activities performed
by the government.
Results: The Office of Management and Budget has proposed applying
the Circular A-76 public-private competition process to all ISSAs.
Proposals to implement a moratorium on privatization and outsourcing
initiatives were removed from the House-passed 2002 defense authorization
bill. Senate-passed version of this bill requires Federal Prison
Industries to compete with the private sector for defense contracts.
Progress payments to defense contractors were increased from 75
percent to 80 percent.
Issue 5: Rationalizing the International Trade Process
U.S. export-control laws, regulations and processes require modification
to meet the realities of a global defense market.
Challenges: Overhaul the outmoded U.S. export-control system, including
implementing joint Pentagon-State Department Defense Trade Security
Initiatives (DTSI) and reviving the Export Administration Act (EAA).
Facilitate increased international defense cooperation.
Actions: Sponsored joint industry-government dialogues on export
controls, including feedback on new DTSI license authorizations
and electronic licensing.nAdvocated renewal of the EAA.
Sponsored joint defense-industry forums with Sweden, Korea and
France.
Results: Moved from concept to implementation phase for DTSI initiatives.
Continued activity and discussion ongoing.nThe Senate passed the
EAA of 2001, with strong bipartisan support and backing from the
administration and industry.nStrengthened U.S. industry’s
linkage with key allies.
Issue 6: Revitalizing the Defense Workforce
Both public and private sectors of the defense workforce face significant
challenges in recruiting and retaining skilled employees.
Challenges: The public sector faces an aging acquisition workforce,
with near-term retirement pending for half of its people.
The private sector of the defense community finds itself less competitive
for talent than other parts of the economy.
Actions: Testified before Congress on these human-capital problems.
Suggested legislation providing incentives for students to pursue
degrees in math, science and engineering.
Results: The QDR outlines a human-resources plan to identify tools
to size and shape the workforce.
The undersecretary of defense for acquisition, technology and logistics
has made revitalizing the quality of his workforce one of five major
goals.