DOD Inflation:

DOD's Inflation Dividends and Unobligated Balances--May 1987 Update

NSIAD-87-151: Published: May 8, 1987. Publicly Released: May 8, 1987.

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Pursuant to a congressional request, GAO updated its estimates of potential excess inflation funds within the Department of Defense's (DOD) budget.

GAO recalculated the amount of the DOD fiscal year (FY) 1987 inflation dividend based on actual appropriated amounts and the revised Office of Management and Budget (OMB) inflation projections included in the DOD January 1987 budget submissions and revised its estimate for nonpay, nonfuel accounts from $3.5 billion to $3 billion. GAO noted that Congress' reduction of the FY requests by $2.4 billion resulted in an amount totalling $600 million less than its calculations. GAO also reviewed the fuel accounts and determined that they had no further dividends. GAO found that, if the OMB January inflation projections for FY 1987 prove to be correct, the congressional reductions of approximately $1.8 billion for FY 1987 will be in excess of the $1.4 billion fuel inflation dividend estimate.

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