Seeking bigger budget, Pentagon keeps wary eye on risk of cuts

[February 13, 2015]  By David Alexander
 
 WASHINGTON (Reuters) - The Pentagon decision to seek a 2016 budget that far exceeds federal spending caps poses the risk of a big across-the-board funding cut like the one that forced the department to put civilian workers on unpaid leave two years ago.

But defense officials say the department will not repeat some of the decisions it made in 2013 that exacerbated the problem once the automatic cuts, known as "sequestration," went into effect nearly halfway through the fiscal year.

"We just kept spending as though sequestration wasn't going to happen," Deputy Defense Secretary Robert Work told reporters this week. This year, he said, "if it's not clear that sequestration is done, we will start being defensive and we will start making sure we are better prepared for it."

Work and Pentagon Comptroller Mike McCord both said the department currently is focused on convincing lawmakers the $534 billion budget, which is nearly $36 billion above federal caps, is necessary to modernize the force after 13 years of war and several years of declining defense spending.

"Our plan is to succeed with convincing Congress why the budget we submitted is the budget we need," McCord told reporters on Thursday. "If we get a strong signal from Congress that that's not going to be what they're going to do, then we will ... take action at the appropriate time."

McCord said the department would "look at what we did (in 2013) and what we maybe could have done better and draw some lessons from that."

A 2011 law aimed at controlling U.S. deficits called for the Pentagon to reduce planned spending by about $1 trillion over a decade. The measure set annual spending caps and approved automatic cuts to enforce them.

Officials said the measure was designed to be draconian to force Congress to reach a compromise to reduce spending. Officials initially did not believe the deep cuts would go into effect, but in 2013 they did.

Work said the reductions were "very, very destructive" for the Pentagon. They went into effect nearly halfway through the fiscal year, forcing the department to take some $37 billion in cuts from funds still unspent.

The Pentagon slashed things like flight training, military exercises and routine maintenance on everything from ships and vehicles to buildings at bases. And they put most civilian workers on unpaid leave.

"It really hurt us," Work said.

(Reporting by David Alexander; Editing by Lisa Shumaker)

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