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Military Procurement: Air Force Should Terminate More Contracts for On-Order Excess Spare Parts

NSIAD-87-141 Published: Aug 12, 1987. Publicly Released: Aug 12, 1987.
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Highlights

In response to a congressional request, GAO reviewed the Air Force's procedures and practices for terminating procurements of excess spare parts.

Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of the Air Force The Secretary of the Air Force should emphasize to the Commander, Air Force Logistics Command (AFLC), the importance of an effective program, including appropriate management guidance and oversight, for terminating procurements of excess on-order spares when termination is in the best interest of the government. Such a program should ensure that: (1) item managers base termination decisions on timely comparisons of the costs of accepting excess material with those of terminating procurements; (2) item managers do not routinely conclude that it is uneconomical to terminate on-order material solely because they believe 75 percent or more of the production lead time has expired; (3) the data in the D041 requirements system are accurate; and (4) air logistics centers do not deviate from AFLC termination regulations without proper approval.
Closed – Implemented
Major aspects of this recommendation were implemented by June 6, 1988. For example, AFLC now requires the use of an economic model to decide whether termination will be cost-effective. AFLC has eliminated the use of 75 percent of production lead time as termination criteria. AFLC completed action by issuing policy directives and instructions to AFC.

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Topics

Air Force procurementAircraft componentsContract terminationContract termination costsCost effectiveness analysisInventory controlIrregular procurementMilitary cost controlSpare partsMilitary forces