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Pursuant to a congressional request, GAO provided information on the: (1) status of the Defense Management Review (DMR) program's budgetary savings; and (2) impact of DMR budgetary reductions. GAO found that: (1) the Department of Defense (DOD) has saved about $8.6 billion as a result of implementing DMR initiatives and recurring savings from these initiatives will total $24 billion for fiscal years 1993 through 1997; (2) DOD expects future savings from other management initiatives, but these savings may not be achieved due to program changes, force-level reductions, or reduced workloads; (3) it is difficult to validate and track savings to specific initiatives because of limited documentation, the lack of a standard automated accounting system, and the difficulty in determining whether savings are related to DMR initiatives or other factors; (4) DOD officials believe that DMR budgetary reductions have not adversely impacted the services because of program tradeoffs and funding adjustments; and (5) each service believes that the present budget is adequate to maintain readiness in the short-term.

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