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War, economy to drive U.S. arms buying reform: Gates

WASHINGTON (Reuters) - Defense Secretary Robert Gates vowed to reform the way the Pentagon buys weapons and said budget pressures resulting from two wars and the economic crisis would force tough choices in coming years.

Secretary of Defense Robert Gates waits to testify at the Senate Armed Services Committee in Washington, January 27, 2009. REUTERS/Larry Downing

“We will not be able to ‘do everything, buy everything’ ... I believe now is the time to take action,” Gates said in testimony Tuesday to the Senate Armed Services Committee, where members welcomed his attention to the acquisition issue.

Gates singled out procurement as one of the biggest challenges facing the Pentagon, and said meaningful reforms would take time and needed support from industry and Congress.

“We must have the courage to make hard choices,” Gates told the committee, adding that changes should be included in the fiscal 2010 budget that begins October 1. “Any necessary changes should avoid across-the-board adjustments, which inefficiently extend all programs,” he said.

He said long-standing systemic problems, including shifting military requirements, a shortage of acquisition experts in government, parochial interests and instability in budgets, had resulted in the current situation, in which “a small set of expensive weapons programs has had repeated -- and unacceptable -- problems with requirements, schedule, cost and performance.”

Gates said the department had already begun to purchase weapons at more efficient rates, and he would work to buy larger quantities of systems that represent the “75 percent solution” instead of waiting for a nearly perfect system.

The Pentagon also needed to ensure that services did not continue to add requirements once a weapons program began, and should write contracts that give incentives for good work.

“The department should seek increased competition, use of prototypes and ensure technology maturity so that our programs are ready for the next phases of development,” Gates said.

Gates said military operations had become better integrated across the services, but their budget and procurement decisions were still largely separate, and sometimes duplicative.

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“To address a given risk, we may have to invest more in the future-oriented program of one service and less in that of another service -- particularly when both programs were conceived with the same threat in mind,” Gates said.

Five major weapons programs accounted for half of total cost growth in weapons spending, Gates told the committee:

-- Lockheed Martin Corp’s F-35 Joint Strike Fighter,

-- Boeing Co’s Future Combat Systems Army modernization program,

-- the Virginia Class attack submarines built by General Dynamics Corp and Northrop Grumman Corp

-- the Pentagon’s primary satellite-launch program, a joint effort of Lockheed and Boeing,

-- and a program to destroy the U.S. stockpile of chemical weapons which includes a number of defense contractors.

Gates served as defense secretary for the last two years of the Bush administration but has agreed to stay on under President Barack Obama. The Bush administration prepared a budget proposal for defense spending in fiscal 2010 that totals around $580 billion.

The administration must present a budget to Congress on the first Monday in February, but Pentagon spokesman Bryan Whitman on Monday said the White House would probably not release a detailed plan for military spending until April.

Gates said the current situation presented an opportunity to better align U.S. defense spending with actual needs, noting that the military could learn important lessons from successful efforts to quickly field armored trucks in Iraq.

Future procurement “must ... be driven more by the actual capabilities of potential adversaries, and less by what is technologically feasible given unlimited time and resources,” he said.

Asked specifically about the fate of the Army’s FCS modernization program, Gates said he was heartened by the Army’s efforts to accelerate work on specific weapons being developed as part of the overall program.

He said the program would continue to be reviewed for possible “spin-outs” as well as parts that were less useful. “I don’t think that anything is off the table at this point.”

Reporting by Andrea Shalal-Esa, editing by Dave Zimmerman and Tim Dobbyn