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SECNAV Spencer: FY 2020 Budget Outlook Could Hurt Fleet Readiness

Secretary of the Navy Richard V. Spencer speaks during an all-hands call onboard U.S. Fleet Activities (FLEACT) Yokosuka on July 12, 2018. US Navy Photo

WASHINGTON, D.C. — Secretary of the Navy Richard V. Spencer is preparing for what could be a tight Pentagon budget environment in Fiscal Year 2020 that could hurt future fleet readiness.

During FY 2018 and 2019, the Navy received funding to address several lingering maintenance problems that were affecting the fleet’s ability to perform missions, Spencer said Thursday morning during an event cohosted by the U.S. Naval Institute and the Center for Strategic and International Studies.

The Navy has not received a top-line budget number for FY 2020 yet, but Spencer said his staff has been preparing for several funding possibilities, and not all of them are good.

“We are working various scenarios, and two things to say there: some of the scenarios make your eyes water with what we might have to do with the numbers,” Spencer said. “The other comment I’d make is we have such great tailwinds right now: we’ve laid the foundation and spent this money to get us going in the right direction. The bicycle is up, we are pedaling; please don’t knock us over. The waste would be absolutely stunning.”

The challenge for Spencer is he’s trying to pay for upgrading and maintaining the current force while funding development of the ships, aircraft and weapons the Navy will need in the future.

For example, Spencer said the Navy is dedicating about 15 percent of its budget to research and development, which is consistent with what happens in the corporate world. However, he’s also spending hundreds of millions of dollars to upgrade the network of drydocks used by the Navy and improve the aircraft parts replacement system.

The investments the Navy has made so far are already benefitting the operational fleet. Spencer said the Navy shaved weeks off the time it takes to replace rudder actuators on F-18s. The Navy completely overhauled the part’s logistics system, and staff training improved. Now, what took more than a month to ship out can be sent to maintainers in about two days.

“It’s a critical part and it’s one of the reasons I had such horrible availability with the F-18,” Spencer said.

In the long term, stable funding is needed for the Navy to increase the fleet size to 355 ships, Spencer said. However, he said comparisons about how many ships the U.S. has in the water in the Pacific versus how many China has, for example, don’t worry him much in the short term.

“We’re not abandoning 355; it’s law, I get it,” Spencer said. “What I look at as a footnote to 355, we also want to look at the global armada of allies and friends,” he said, noting recent international exercises aimed at boosting interoperability between the U.S. Navy and its allies and partners in strategic locations like the Pacific and the North Atlantic.

When he goes to Capitol Hill to testify about the Navy’s needs and readiness issues, Spencer said his mission is making the business case for why spending needs to occur. Readiness is his focus because it turned out to be the biggest surprise he encountered when taking the job in August 2017.

“I thought I had a good handle on the readiness issue,” Spencer said. “I was completely gobsmacked on how wide and how deep the readiness issue was. We’ve come to level ground on that.”

  • Mike Mulligan

    The Navy needs to start talking where they failed or deficient…not what they accomplished or where they were successful. We really need a completely new military infrastructure. Basically all of current military information infrastructures (GAO) have failed to do their job. And this institution be well funded. Its sole focus most be to expose the problems in our military.

  • Ed L

    Sure sounds like the SecNav really understands how bad the situation is, now he needs to convince the congress to keep funding at the current level. And then convince Congress our Navy needs more funds to keep current vessels operational as well as fund replacement warships and support ships.

  • Bryan

    Let me give you a clue sir, your budget is going to go down. Let me give you a prediction, you should make the Navy develop a force structure that can more gracefully decline. Here’s a thought experiment, how can the Navy better project power on half it’s budget?

    Here a few concepts for you to consider: More missiles forward to help the transition from peace to full war if needed. Surface action groups. LHA’s used as peacetime CVL’s. Less CVN’s. As that no longer works you will have to consider SSK’s forward deployed with less SSN’s.

  • PolicyWonk

    A 355-ship fleet is a great thought: but if we can’t maintain readiness with the 288-ship fleet we currently have, how does 355 ships improve our situation?

    The federal government cannot sustain their ambitious plans for expanding the USMC and gator fleet, the USN, USAF, and Army (I’m ignoring the outstanding value the USCG brings to the table for this discussion, because that’s what the HoR’s do), while ignoring the reform of DoD acquisition practices, that more often than not deliver the lousiest deal for defense dollar spent in the western world.

    The USN (and rest of the service branches) all gambled on sequestration not happening, and lost. Subsequently, they all maintained force/fleet (etc.) sizes, while ignoring maintenance and readiness, all of which languished.

    Will they learn from this lesson from the recent past? I doubt it.

    The federal government has been more recently grossly irresponsible with the management of this nations economic/financial future, because they’ve been happily repeating the same mistakes they made during the GWB years that were clearly spelled out in the CBO report on The Causes Of The Great Recession. Add to this the total ineptness of this administrations far-below-JV foreign policy, the trade wars, among other erratic actions, and its starting to look like yet another recession will soon be upon us.

    None of this bodes well for future DoD budgets.

    We can all sit back and watch history repeat itself.

  • old guy

    The old drumbeat for money sounds pretty weak when we have not even developed a doctrine, no less a force structure or a deployment strategy.

  • Jeff

    Millions of dollars could be saved by fixing the inefficient contract workflows, financial system, revamping NAVFAC, NMCI, etc. To pay $750k for a renovation that you can get done for $100k is simply ridiculous and then no recourse when it doesn’t work but pay more to correct the problem.

    More is spent on the inefficient financial system than producing the product. Funding expires resulting work stoppage, then funding is provided and then it expires and the process starts over. Provide funding for a project for the duration instead of year by year will greatly increase the efficiency.

    There are so many more.