Bloomberg News

Senators Question Air Force's $1 Billion Failed Software

December 06, 2012

Leaders of the Senate Armed Services Committee have asked U.S. Defense Secretary Leon Panetta to explain why the Air Force scrapped a software system to manage its supply chain after spending more than $1 billion on it.

The Air Force last month canceled the Expeditionary Combat Support System after determining that the program was “no longer a viable option” to help the service meet a goal to have its financial books ready for a federal audit by 2017.

“From what we know to date, this case appears to be one of the most egregious examples of mismanagement in recent memory,” Senator Carl Levin, a Michigan Democrat and the committee’s chairman, and Senator John McCain of Arizona, its senior Republican, wrote yesterday in a letter to Panetta.

The program was canceled after being reorganized three times in three years, making it “apparent the Air Force will be better served by developing an entirely new strategy versus revamping” it, the service said in canceling it.

The action came after the Air Force in March terminated a fixed-price contract for the system with Computer Sciences Corp. (CSC:US) The company had been paid $527 million, according to the Air Force.

Of nine software systems that the Pentagon is installing to improve longstanding financial management deficiencies, the Air Force program was one of at least six that were running as much as 12 years late and $6.9 billion over their original cost estimates, the Government Accountability Office reported in September 2010.

‘Clear Explanation’

“We believe that the public and the taxpayers deserve a clear explanation of how the Air Force came to spend more than $1 billion without receiving any significant military capability, who will held accountable and what steps the department is taking to ensure that this will not happen again,” Levin and McCain said in their letter.

Among 10 questions the lawmakers posed for the Defense Department are what benefits the service gained for the dollars spent and “what capabilities, if any, will be salvaged.”

The lawmakers said service officials told them that the Air Force has received software and hardware valued at less than $150 million.

A Pentagon spokeswoman, Army Lieutenant Colonel Elizabeth Robbins, referred requests for comment to the Air Force.

“When the Air Force receives a request for information, we will respond appropriately,” service spokeswoman Ann Stefanek said in an e-mail.

Contractor’s Comment

The lawmakers also asked Panetta what steps the department will take “to ensure the prime contractor’s failure to perform as required is appropriately considered as past performance in connection with future” contracts.

Heather Williams, a spokeswoman for Falls Church, Virginia- based Computer Sciences, said in an e-mail yesterday that the company “has a long-standing and ongoing relationship with the Air Force and is not in a position to answer these questions independently from the Air Force.”

Williams said in an earlier e-mail that the company “worked closely and cooperatively with the Air Force’s senior leadership to close out” the contract.

“We stand behind the work accomplished to date which can provide a solid foundation for the program’s future,” she said.

To contact the reporter on this story: Tony Capaccio in Washington at acapaccio@bloomberg.net

To contact the editor responsible for this story: John Walcott at jwalcott9@bloomberg.net


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Companies Mentioned

  • CSC
    (Computer Sciences Corp)
    • $60.4 USD
    • 0.35
    • 0.58%
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