FY2013 DoD budget will be lower than FY2012

Friday, January 27th, 2012

The FY2013 DOD base budget request will total $525 billion, down $5 billion from the amount enacted by Congress for FY2012 ($531 billion), according to Secretary of Defense Leon Panetta.   Panetta and GEN Martin Dempsey, Chairman of the Joint Chiefs of Staff, presented a preview of the FY2012 DoD budget at the Pentagon yesterday.  The FY2012 enacted budget was $22 billion less than the president requested.  The FY2013 budget will be released on February 13.

The war budget for FY2013 will also be lower than in FY2012.  The FY2013 request for Overseas Contingency Operations (primarily for operations in Afghanistan) will be $88 billion, $27 billion lower than the FY2012 enacted level. 

Panetta said the new budget is “a balanced and complete package” that reflects the decisions made under the guidance provided by the new military strategy, announced recently. 

The FY2013 request and the long-term budget plan adhere to the budget totals included in the Budget Control Act of 2011, Panetta said.  The new plan calls for cutting $487 billion over the next 10 years.  As a result, the FY2013 budget request will be $45 billion lower than assumed last year.  More than one-half ($259 billion) of the 10-year cut will be taken from the FY2013-17 plan.

Even with significantly lower resources, Panetta said the U.S military will still be the strongest in the world, the force will not be hollowed-out, and DOD will keep faith with servicemembers and their families.

The FY2013 budget minimizes the effect of the budget cuts on personnel, according to the secretary, but he implied that in future years even personnel costs would have to bear a share of budget cuts.  “The budget will contain a road map to try to address the costs of military pay, health care and retirement in ways that we believe are fair, transparent, and consistent with our fundamental commitments to our people.”

The budget will “sustain and enhance critical support programs while reforming and reorganizing others to be more effective and responsive to the needs of the troops and their families,” Panetta explained.  Full military pay raises will be provided in FY2013 and FY2014, but he indicated that beginning in FY2015, those raises will be limited in order to meet budget constraints.  On health care, he said the budget protects health care services for troops and their families.  However, for retirees the budget plan recommends health care fee, co-pay, and deductable increases to be phased in over five years.  And, Panetta is recommending that Congress appoint a commission to comprehensively review military retirement. 

Panetta laid out some of the key elements of the FY2013 budget and the decisions it reflects (more details are available in Defense Budget Priorities and Choices).  The size of the force will decline over the next five years.  The Army will drop form a current force of 562,000 to 490,000 (-72,000) and the Marine Corps will go from 202,000 to 182,000 (-20,000).  Even so, Panetta said the Army and Marine Corps will be “more lethal, battle hardened, and ready.”

As part of restructuring the military force, DoD will rebalance overseas and U.S. facilities infrastructure.  The budget will ask Congress to authorize a new Base Realignment and Closure (BRAC) round as the most effective way to achieve savings in infrastructure, Panetta said.  And, DoD will move to rebalance “global posture and presence to emphasize Asian-Pacific and Middle East areas,” as outlined in the new military strategy.  To support this new emphasis, the budget will maintain the current bomber fleet, maintain an 11-ship carrier fleet and 10 air wings, and sustain Army and Marine Corps presence in the Pacific while having a “persistent presence in the Middle East.”

Panetta said the budget will achieve significant savings in overhead (an additional $60 billion over five years).  Planned actions include:  employing competitive contracting practices; using information technology better; streamlining staff, reducing contract services, and managing inventory better.” 

To provide additional resources to protect strategic priorities, the budget makes changes to the shipbuilding program including:  retiring seven cruisers early; slipping a large deck amphibious ship (LHA) by one year and one new Virginia class submarine out of the FYDP; and reducing two Littoral Combat Ships (LCS) in the FYDP.  The budget also proposes disestablishing six Air Force tactical-air fighter squadrons and one training squadron.

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