The Defense Department, which has promised to publish a reliable account of how it spends its money by 2017, has discovered that its financial ledgers are in worse shape than expected and that it will have to spend billions of dollars in the coming years to make its financial accounting credible, the Center for Public Integrity reported Thursday.
The U.S. military has spent more than $6 billion to develop and deploy new financial systems, but the effort has been plagued by significant added overruns and delays, defense officials told the CPI, a nonprofit investigative news organization.
The Government Accountability Office said in a report last month that although the services can now fully track incoming appropriations, they still can't demonstrate that their funds are being spent as they should be.
The Pentagon’s bookkeeping has come under increased scrutiny as Congress and the Obama administration have vowed to reduce the federal deficit. The Pentagon requested $671 billion for fiscal 2012, but disputes over the deficit prevented Congress from passing the budget by the Sept. 30 deadline. The department could face substantial cutbacks if a special bipartisan "supercommittee" can’t agree on a formula for reducing the deficit.
As the Associated Press explained this week, the summer debt agreement between President Barack Obama and Congress mandates $350 billion in defense cuts over 10 years, and that figure could grow significantly depending on how the supercommittee slashes at least $1.2 trillion from future deficits. But if the panel stumbles, or Congress rejects its recommendations, the cut to defense could be even deeper as automatic reductions kick in, with half coming from defense.
