National Defense Stockpile: Views on DOD's 1992 Report to the Congress and Proposed Legislation

GAO discussed: (1) its views on the Department of Defense's (DOD) 1992 report to Congress on national defense stockpile requirements; (2) recommended DOD acquisition and disposal plans; (3) DOD response to previous GAO recommendations regarding national defense stockpile goals; and (4) federal agencies' participation in the DOD requirements determination process. GAO noted that: (1) the material consumption ratios (MCR) that DOD used in its 1992 study to convert the estimates of an industry's output into the requirements for a critical material were based on data that were more than 10 years old and could not be verified from surviving data sources; (2) the 1992 study does not present sensitivity analyses to represent other sources of uncertainty that can arise from such factors as inventory level changes, materials price speculation, or the likelihood that wartime MCR are not comparable to peacetime MCR; (3) changes in the world situation and reductions in force indicate that cautious disposal of cobalt and some other materials is probably prudent; (4) DOD has made limited progress in addressing previous GAO recommendations; and (5) civilian federal agencies generally participate in stockpile management on an informal and ad hoc basis.