Missile Defense: Actions Are Needed to Enhance Testing and Accountability

GAO-04-409 Published: Apr 23, 2004. Publicly Released: Apr 23, 2004.
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Highlights

The Department of Defense (DOD) has treated ballistic missile defense as a priority since the mid-1980s and has invested tens of billions of dollars to research and develop such capabilities. In 2002 two key events transformed DOD's approach in this area: (1) the Secretary of Defense consolidated existing missile defense elements into a single acquisition program and placed them under the management of the Missile Defense Agency (MDA) and (2) the President directed MDA to begin fielding an initial configuration, or block, of missile defense capabilities in 2004. MDA estimates it will need $53 billion between fiscal years 2004 and 2009 to continue the development, fielding, and evolution of ballistic missile defenses. To fulfill a congressional mandate, GAO assessed the extent to which MDA achieved program goals in fiscal year 2003. While conducting this review, GAO also observed shortcomings in how MDA defines its goals.

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Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Defense To provide increased confidence that a fielded block of the BMDS will perform as intended when placed in the hands of the warfighter and that further investments to improve the BMDS through block upgrades are warranted, the Secretary of Defense should direct the Director, MDA, to prepare for independent, operationally realistic testing and evaluation for each BMDS block configuration being fielded and appoint an independent operational test agent to plan and conduct those tests.
Closed – Not Implemented
Although Department of Defense (DOD) concurred with GAO's recommendation, they did not implement the recommendation. Missile Defense Agency (MDA) did not appoint an independent operational test agent to plan and conduct tests for the Ballistic Missile Defense System (BMDS) bock configuration.
Department of Defense To provide increased confidence that a fielded block of the BMDS will perform as intended when placed in the hands of the warfighter and that further investments to improve the BMDS through block upgrades are warranted, the Secretary of Defense should assign the Director of Operational Test and Evaluation (DOT&E) responsibility for approving such test plans.
Closed – Implemented
The Department of Defense (DOD) concurred with GAO's recommendation to prepare for and to conduct operationally realistic testing for each BMDS block configuration being fielded. In addition, Congress wrote this recommendation into law (see Sec. 234(a-d) of the FY 2005 Defense Authorization Act), as applied to Block 2004. In carrying out this recommendation, MDA is preparing for such a test in collaboration with the Director, Operational Test and Evaluation (DOT&E). Planning began in October of 2004 and will culminate with the execution of FTG 04-3, which is likely to be conducted in FY 2006.
Department of Defense To provide increased confidence that a fielded block of the BMDS will perform as intended when placed in the hands of the warfighter and that further investments to improve the BMDS through block upgrades are warranted, the Secretary of Defense should direct DOT&E to report its evaluation of the results of such tests to the Secretary and the congressional defense committees.
Closed – Implemented
In disagreeing with this recommendation, DOD stated that the reporting responsibilities of the Director, Operational Test and Evaluation (DOT&E) are already established in statute. 10 USC 139 requires that DOT&E submit an annual report to the Secretary of Defense and the Congress on the adequacy of DOD's operational test and evaluation activities during the previous fiscal year. In addition, 10 USC 2399 requires that DOT&E submit a report to the Secretary and the congressional defense committees on major defense acquisition programs prior to a decision that those programs proceed beyond low-rate initial production. The Director is to assess the items or components tested are effective and suitable for operational use. Technically, however, since MDA has not made milestone decisions, such as low rate initial production, before fielding assets, DOT&E has not been required to report on such testing for missile defense. However, Congress has since directed DOT&E to annually evaluate all Ballistic Missile Defense System elements, which includes an assessment of the operational realism of BMDS element tests.
Department of Defense To provide decision makers in DOD and Congress with a reliable and complete basis for carrying out oversight of the BMDS program, the Secretary of Defense should direct the Director, MDA, to establish cost, schedule, and performance baselines (including full life-cycle costs) for each block configuration of the BMDS being fielded.
Closed – Implemented
DOD concurred with this recommendation and Congress wrote this recommendation into law (see Sec. 234(e) of the FY 2005 Defense Authorization Act). In carrying out GAO's recommendation, MDA generated baselines for its Block 2004 and Block 2006 configurations; they are presented in the April 2004 document, "BMDS Baseline Package." So-called life-cycle costs presented in the baseline package are not typical in the sense that they do not represent total development, procurement, O&S, and disposal costs over an extended period of time. Rather, such costs are given through fiscal year 2011.
Department of Defense To provide decision makers in DOD and Congress with a reliable and complete basis for carrying out oversight of the BMDS program, the Secretary of Defense should direct the Director, MDA, to explain year-to-year variations from the baselines in the Selected Acquisition Report to Congress.
Closed – Implemented
The Missile Defense Agency expects to explain variations in program baselines (cost, schedule, and performance) beginning in its fiscal year 2005 Selected Acquisition Report prepared for the Congress, which is expected to be delivered in FY 2006. GAO notes, in addition, that variations are explained to some extent in the Staffer Day Briefings and the R-2 budget documents.
Department of Defense We recommend that the Missile Defense Agency analyze the degree of risk associated with the Kinetic Energy Interceptor software components by performing an uncertainty analysis that quantifies the reliability of the proposed estimates.
Closed – Implemented
MDA conducted the uncertainty analysis and concluded that software is not a high-risk program component. Specifically, the analysis found that (1) $200 to $300 million is a realistic cost range for software development, (2) the program estimate of $212 million is at the 65 percent point for the most likely estimate, (3) software development is not on the KEI program critical path, and (4) software development represents 4-6 percent of the contract value.

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