Securing, Stabilizing, and Rebuilding Iraq: GAO Audit Approach
and Findings (18-JAN-07, GAO-07-385T).
GAO provided a strategic overview of GAO's work related to
securing, stabilizing, and rebuilding Iraq. In our statement
today, as requested, GAO highlighted (1) GAO's scope, authority,
and coordination; (2) some of the insights stemming from our work
in Iraq; and (3) the rigorous quality assurance framework that
GAO uses to ensure relevant, reliable, and consistent results in
all of our work. This testimony is based upon extensive work
spanning several years. Since 2003, we have issued 67
Iraq-related reports and testimonies. For example, GAO sent a
report to the Congress last week on a range of key issues for
congressional oversight of efforts to secure, stabilize, and
rebuild Iraq. Although many of our sources are classified, we
strive to report information to the Congress in a public format
to promote greater transparency and accountability of U.S.
government policies, programs, and activities. As provided for in
our congressional protocols, most of our work in Iraq has been
performed under my authority to conduct evaluations on my own
initiative since it is a matter of broad interest to the entire
Congress and numerous committees in both chambers. Our work also
helped inform the deliberations of the Iraq Study Group; the
Comptroller General personally briefed this group on the results
of our Iraq work in June 2006. GAO also provided significant
additional information to the Iraq Study Group for its use.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-07-385T
ACCNO: A64965
TITLE: Securing, Stabilizing, and Rebuilding Iraq: GAO Audit
Approach and Findings
DATE: 01/18/2007
SUBJECT: Accountability
Contract administration
Foreign governments
Military forces
National policies
Policy evaluation
Quality assurance
Strategic planning
Transparency
Global War on Terrorism
Iraq
******************************************************************
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GAO-07-385T
* [1]Summary
* [2]GAO's Work in Iraq Is Broad and Coordinated with Other Audit
* [3]Key Findings and Recommendations from GAO's Work in Iraq
* [4]Assessment of the November 2005 National Strategy for Victor
* [5]Limited Transparency on the Costs of the Global War on Terro
* [6]Progress in Transferring Security Responsibilities to Iraq H
* [7]DOD May be Unable to Ensure that U.S.-Funded Equipment Has R
* [8]Challenges in Improving Governance and Spending Budgeted Cap
* [9]Impact of the War on U.S. Military Readiness
* [10]Problems in Securing Munitions Sites and Providing Force Pro
* [11]Improving DOD Acquisition Outcomes
* [12]GAO's Quality Assurance Framework
* [13]Concluding Observations
* [14]GAO Contacts and Acknowledgments
* [15]GAO's Mission
* [16]Obtaining Copies of GAO Reports and Testimony
* [17]Order by Mail or Phone
* [18]To Report Fraud, Waste, and Abuse in Federal Programs
* [19]Congressional Relations
* [20]Public Affairs
Testimony
Before the Committee on Armed Services, House of Representatives
United States Government Accountability Office
GAO
For Release on Delivery Expected at 10:00 a.m. EST
Thursday, January 18, 2007
SECURING, STABILIZING, AND REBUILDING IRAQ
GAO Audit Approach and Findings
Statement of David M. Walker Comptroller General of the United States
GAO-07-385T
Mr. Chairman and Members of the Committee:
I am pleased to be here today to provide a strategic overview of GAO's
work related to securing, stabilizing, and rebuilding Iraq. In my
statement today, as requested, I will highlight (1) GAO's scope,
authority, and coordination; (2) some of the insights stemming from our
work in Iraq; and (3) the rigorous quality assurance framework that GAO
uses to ensure relevant, reliable, and consistent results in all of our
work.
My statement today is based upon extensive work spanning several years.
Since 2003, we have issued 67 Iraq-related reports and testimonies. For
example, I sent a report to the Congress last week on a range of key
issues for congressional oversight of efforts to secure, stabilize, and
rebuild Iraq.^1 Although many of our sources are classified, we strive to
report information to the Congress in a public format to promote greater
transparency and accountability of U.S. government policies, programs, and
activities. As provided for in our congressional protocols, most of our
work in Iraq has been performed under my authority to conduct evaluations
on my own initiative since it is a matter of broad interest to the entire
Congress and numerous committees in both chambers. Our work also helped
inform the deliberations of the Iraq Study Group; I personally briefed
this group on the results of our Iraq work in June 2006. We also provided
significant additional information to the Iraq Study Group for its use.
The work supporting this statement is based on our analysis of agency
plans and documents and discussions with relevant senior officials from
the Departments of Defense (DOD), Energy, State, and the Treasury; the
U.S. Agency for International Development (USAID); the Army Corps of
Engineers; the multinational force; the Defense Intelligence Agency; and
the Central Intelligence Agency. We conducted our reviews in accordance
with generally accepted government auditing standards.
Summary
GAO and the Inspectors General (IG) of individual departments and agencies
have different roles and responsibilities. GAO's broad audit authority
allows us to support Congress through strategic analyses of issues that
cut across multiple federal agencies and sources of funding. Our work
spans the security, political, and economic prongs of the U.S. national
strategy in Iraq. The broad, cross-cutting nature of this work helps
minimize the possibility of overlap and duplication by any individual
Inspector General.
^1GAO, Securing, Stabilizing, and Rebuilding Iraq: Key Issues for
Congressional Oversight, [21]GAO-07-308SP (Washington, D.C.: Jan. 9,
2007).
Based on our work, we have made some unique contributions to Congress. Our
past and ongoing work has focused on the U.S. strategy and costs of
operating in Iraq, training and equipping the Iraqi security forces,
governance issues, the readiness of U.S. military forces, and acquisition
outcomes. Some highlights from our work follow:
o Our analysis of the National Strategy for Victory in Iraq
recommended that the National Security Council improve the
strategy by articulating clearer roles and responsibilities,
specifying future contributions, and identifying current costs and
future resources.
o In our examination of the cost of U.S. military operations
abroad, we recommended that the Secretary of Defense improve the
transparency and reliability of DOD's Global War on Terror (GWOT)
obligation data. We also recommended that DOD build more funding
into the baseline budget once an operation reaches a known level
of effort and costs are more predictable.
o In assessing the capabilities of Iraqi security forces, we found
that overall security conditions in Iraq have deteriorated despite
increases in the numbers of trained and equipped security forces.
A complete assessment of Iraqi security forces' capabilities is
dependent on DOD providing GAO with the readiness levels of each
Iraqi unit.
o We found that DOD faces significant challenges in maintaining
U.S. military readiness for overseas and homeland missions and in
sustaining rotational deployments of duty, especially if the
duration and intensity of current operations continue at the
present pace.
o In assessing the impact of ongoing military operations in Iraq
on military equipment, we found that the Army and the Marine Corps
have initiated programs to reset (repair or replace) equipment and
are likely to incur large expenditures in the future.
o In reviewing efforts to secure munitions sites and provide force
protection, we recommended that DOD conduct a theaterwide survey
and risk assessment of unsecured conventional munitions in Iraq
and incorporate storage site security into strategic planning
efforts.
o In assessing acquisition outcomes, we found that DOD often
entered into contract arrangements with unclear requirements,
which posed additional risks to the government. DOD also lacked
the capacity to provide sufficient numbers of contracting,
logistics, and other personnel, thereby hindering oversight
efforts.
In April 2005, an international peer review team gave our quality
assurance system a clean opinion--only the second time a national
audit institution has received such a rating from a multinational
team. Thus, the Congress and the American people can have
confidence that GAO's work is independent, objective, and
reliable.
GAO�s Work in Iraq Is Broad and Coordinated with Other Audit
Authorities
While the IGs are designed to focus primarily on exposing fraud,
waste, and abuse in individual federal agency programs, GAO's
broad audit authority allows us to support Congress through
strategic analyses of issues that cut across multiple federal
agencies and sources of funding. Although the IGs report to the
heads of their respective departments and make periodic reports to
Congress, GAO reports directly to Congress on a continuous basis.
GAO consults regularly with its oversight committees and relevant
committees of jurisdiction regarding key issues of national
importance, such as U.S. fiscal solvency, emergency preparedness,
DOD transformation, global competitiveness, and emerging health
care and other challenges for the 21st century.
The Congress established the GAO in 1921 to investigate all
matters relating to the receipt, disbursement, and application of
public funds. Since then, Congress has expanded GAO's statutory
authorities and frequently calls upon it to examine federal
programs and their performance, conduct financial and management
audits, perform policy analysis, provide legal opinions,
adjudicate bid protests, and conduct investigations. In 2006, the
GAO issued more than 1,000 audit products and produced a $105
return for each dollar invested in the agency.^2
GAO has developed substantial expertise on security and
reconstruction issues, as well as having long-term relationships
with State, Defense, and USAID. Our work spans several decades and
includes evaluations of U.S. military and diplomatic programs and
activities, including those during and following contingency
operations in Vietnam, the Persian Gulf (Operations Desert Shield
and Storm), Bosnia, and Afghanistan.
We also have many years of expertise in evaluating U.S. efforts to
help stabilize regions or countries; we have, for example,
monitored U.S. assistance programs in Asia, Central America, and
Africa. The depth and breadth of our work and the expertise we
have built has helped facilitate our ability to quickly gather
facts and provide insights to the Congress as events unfold, such
as the conflict in Iraq. Our current work draws on our past work
and regular site visits to Iraq and the surrounding region, such
as Jordan and Kuwait. Furthermore, we plan to establish a presence
in Iraq beginning in March 2007 to provide additional oversight of
issues deemed important to Congress. Our plans, however, are
subject to adequate fiscal 2007 funding of GAO by the Congress.
Our work in Iraq spans the three prongs of the U.S. national
strategy in Iraq--security, political, and economic. The broad,
cross-cutting nature of our work helps minimize the possibility of
overlap and duplication by individual IGs. We and other
accountability organizations take steps to coordinate our
oversight with others to avoid duplication and leverage our
resources. In that regard, the ability of the Special Inspector
General for Iraq Reconstruction (SIGIR) to provide in-country
oversight of specific projects and reconstruction challenges has
enabled us to focus our work on more strategic and cross-cutting
national, sector, and interagency issues.
The expansion of SIGIR's authority underscores the need for close
coordination. We coordinate our work in Iraq through various
forums, including the Iraq Inspectors General Council (IIGC) and
regular discussions with the IG community. Established by what is
now SIGIR, IIGC provides a forum for discussion and collaboration
among the IG and staff at the many agencies involved in Iraq
reconstruction activities. Our work is coordinated through regular
one-on-one meetings with SIGIR, DOD, State, and USAID. We also
coordinate our work with other accountability organizations, such
as the Federal Bureau of Investigation's (FBI) public corruption
unit.
Key Findings and Recommendations from GAO�s Work in Iraq
Let me highlight some of the key findings and recommendations we
have made as a result of our continuing work in Iraq.
Assessment of the November 2005 National Strategy for Victory in
Iraq and the U.S. Military Campaign Plan
In November 2005, the National Security Council issued the
National Strategy for Victory in Iraq (NSVI) to clarify the
President's strategy for achieving U.S. political, security, and
economic goals in Iraq. The U.S. goals included establishing a
peaceful, stable, and secure Iraq. Our July 2006 report assessed
the extent to which the NSVI and its supporting documents
addressed the six characteristics of an effective national
strategy.^3 While we reported that the NSVI was an improvement
over previous U.S. planning efforts for stabilizing and rebuilding
Iraq, we concluded that the strategy fell short in at least three
key areas. First, it only partially identified the agencies
responsible for implementing key aspects of the strategy. Second,
it did not fully address how the United States will integrate its
goals with those of the Iraqis and the international community,
and it did not detail Iraq's anticipated contribution to its
future needs. Third, it only partially identified the current and
future costs of U.S. involvement in Iraq, including maintaining
U.S. military operations, building Iraqi government capacity, and
rebuilding critical infrastructure.
We recommended that the NSC improve the current strategy by
articulating clear roles and responsibilities, specifying future
contributions, and identifying current costs and future resources.
In addition, our report urged the United States, Iraq, and the
international community to (1) enhance support capabilities of the
Iraqi security forces, (2) improve the capabilities of the
national and provincial governments, and (3) develop a
comprehensive anti-corruption strategy. In our view, congressional
review of the President's 2007 plan for Iraq should consider
whether it addresses the key elements of a sound national strategy
identified in our July 2006 report.
In October 2005, we issued a classified report on the military's
campaign plan for Iraq.^4 In that report, we discussed the
military's counterinsurgency plan for Iraq and the conditions and
phases in the plan. The report contained a recommendation to link
economic, governance, and security indicators to conditions for
stabilizing Iraq. Congress acted on our recommendation in the 2006
National Defense Authorization Act and required DOD to report on
progress toward meeting the conditions referred to in GAO's
report. We have supplemented this work with a series of classified
briefings to the Congress on changes to the campaign plan and U.S.
efforts to train and equip Iraqi security forces and protect
weapons caches throughout Iraq. We will continue to provide
Congress these classified briefings.
Limited Transparency on the Costs of the Global War on Terror
Since 2001, Congress has appropriated about $495 billion to U.S.
agencies for military and diplomatic efforts in support of the
global war on terrorism; the majority of this amount has gone to
stabilize and rebuild Iraq. Efforts in Iraq involve various
activities such as combating insurgents, conducting civil affairs,
building capacity, reconstructing infrastructure, and training
Iraqi military forces. To date, the United States has reported
substantial costs for Iraq and can expect to incur significant
costs in the foreseeable future, requiring decision-makers to
consider difficult trade-offs as the nation faces an increasing
number of long-range fiscal challenges. Funding for these efforts
has been provided through annual appropriations, as well as
supplemental appropriations that are outside the annual budget
process. In our view, moving more funding into baseline budgets,
particularly for DOD, would enable decision-makers to better weigh
priorities and assess trade-offs.
As of September 30, 2006, DOD had reported costs of about $257.5
billion for military operations in Iraq.^5 In addition, as of
October 2006, about $29 billion had been obligated for Iraqi
reconstruction and stabilization efforts. However, problems with
the processes for recording and reporting GWOT costs raise
concerns that these data may not accurately reflect the true
dollar value of war-related costs.
U.S. military and diplomatic commitments in Iraq will continue for
the foreseeable future and are likely to involve hundreds of
billions of additional dollars. The magnitude of future costs will
depend on several direct and indirect variables and, in some
cases, decisions that have not been made. DOD's future costs will
likely be affected by the pace and duration of operations, the
types of facilities needed to support troops overseas,
redeployment plans, and the amount of military equipment to be
repaired or replaced. Although reducing the number of troops would
appear to lower costs, we have seen from previous operations in
the Balkans and Kosovo that costs could rise--if, for example,
increased numbers of contractors replace military personnel. With
activities likely to continue into the foreseeable future,
decision-makers will have to carefully weigh priorities and make
difficult decisions when budgeting for future costs.
Over the years, we have made a series of recommendations to the
Secretary of Defense intended to improve the transparency and
reliability of DOD's GWOT obligation data, including
recommendations that DOD (1) revise the cost-reporting guidance so
that large amounts of reported obligations are not shown in
"miscellaneous" categories, and (2) take steps to ensure that
reported GWOT obligations are reliable. We also have recommended
that DOD build more funding into the baseline budget once an
operation reaches a known level of effort and costs are more
predictable. In response, the department has implemented many of
our previous recommendations.
Progress in Transferring Security Responsibilities to Iraq Has
Not Led to Improved Security Conditions
Overall security conditions in Iraq continued to deteriorate in
2006 and have grown more complex despite recent progress in
transferring security responsibilities to Iraqi security forces
and the Iraqi government. The number of trained and equipped Iraqi
security forces has increased from about 174,000 in July 2005 to
about 323,000 in December 2006, at the same time as more Iraqi
army units have taken the lead for counterinsurgency operations in
specific geographic areas. Despite this progress, attacks on
coalition forces, Iraqi security forces, and civilians have all
increased, reaching record highs in October 2006. Because of the
poor security in Iraq, the United States could not draw down U.S.
force levels in Iraq as planned in 2004 and 2006, and U.S. forces
have continued to conduct combat operations in urban areas,
especially Baghdad.
Transferring security responsibilities to the Iraqi security
forces and provincial governments is a critical part of the U.S.
government's strategy in Iraq and key to allowing a drawdown of
U.S. forces. Since 2003, the United States has provided about
$15.4 billion to train, equip, and sustain Iraqi security forces
and law enforcement. However, it is unclear whether U.S.
expenditures and efforts are having their intended effect in
developing capable forces and whether additional resources are
needed. A key measure of the capabilities of Iraqi forces is the
Transition Readiness Assessment (TRA) reports prepared by
coalition advisors embedded in Iraqi units. These reports serve as
the basis for the Multinational Force-Iraq (MNF-I) determination
of when a unit is capable of leading counterinsurgency operations
and can assume security responsibilities for a specific area.
The TRA reports provide the coalition commander's professional
judgment on an Iraqi unit's capabilities and are based on ratings
in personnel, command and control, equipment, sustainment and
logistics, training, and leadership. To conduct future work on
this issue, GAO has made multiple requests for full access to the
unit-level TRA reports over the last year. However, DOD has not
yet complied with our requests. This serves to seriously and
inappropriately limit congressional oversight over the progress
achieved toward a critical U.S. objective.
DOD May be Unable to Ensure that U.S.-Funded Equipment Has
Reached Iraqi Security Forces
Since 2003, the United States has provided about $15.4 billion for
Iraqi security forces and law enforcement. According to
Multinational Security Transition Command-Iraq (MNSTC-I) records,
MNF-I has issued about 480,000 weapons, 30,000 vehicles, and 1.65
million pieces of gear (uniforms, body armor, helmets, and
footwear), among other items, to the Iraqi security forces as of
October 2006.
Congress funded the train-and-equip program for Iraq outside
traditional security assistance programs, which, according to DOD
officials, provided DOD with a large degree of flexibility in
managing the program. Since the funding did not go through
traditional security assistance programs,^6 the accountability
requirements normally applicable to these programs did not
necessarily apply, according to DOD officials. It is currently
unclear what accountability measures, if any, DOD has chosen to
apply to the train-and-equip program for Iraq, as DOD officials
have expressed differing opinions on this matter. As part of our
ongoing work, we have asked DOD to clarify what accountability
measures it has chosen to apply to the program.
While it is unclear which regulations DOD has chosen to apply,
beginning in early 2004, MNF-I established requirements to control
and account for equipment provided to the Iraqi security forces by
issuing orders that outlined procedures for its subordinate
commands. These included obtaining signed records for equipment
received by Iraqi units or individuals and recording weapons
serial numbers. Although MNF-I took initial steps to establish
property accountability procedures, limitations such as the
initial lack of a fully operational equipment distribution
network, staffing weaknesses, and the operational demands of
equipping the Iraqi forces during war hindered its ability to
fully execute critical tasks outlined in the property
accountability orders. Since late 2005, MNSTC-I has taken
additional steps to improve its property accountability
procedures, including establishing property books^7 for equipment
issued to Iraqi Ministry of Defense and Ministry of Interior
forces. According to MNSTC-I officials, MNSTC-I also recovered
existing documentation for equipment previously issued to Iraqi
forces. However, according to our preliminary analysis, DOD and
MNF-I may not be able to account for Iraqi security forces'
receipt of about 90,000 rifles and about 80,000 pistols that were
reported as issued before early October 2005. Thus, DOD and MNF-I
may be unable to ensure that Iraqi military forces and police
received all of the equipment that the coalition procured or
obtained for them.
In our ongoing review, we will continue to assess MNF-I records
for Iraqi equipment distributed to Iraqi forces. We plan on
issuing a final report on these and related intelligence matters
by March 2007. Our work focuses on the accountability
requirements^8 for the transportation and distribution of
U.S.-funded equipment and did not review any requirements relevant
to the procurement of this equipment.
Challenges in Improving Governance and Spending Budgeted Capital
Project Funds
The U.S. government faces significant challenges in improving the
capabilities of Iraq's central and provincial governments so that
they can provide security and deliver services to the Iraqi
people. According to State, the Iraqi capacity for self-governance
was decimated after nearly 30 years of autocratic rule. In
addition, Iraq lacked competent existing Iraqi governmental
organizations. Since 2003, the United States has provided the
Iraqis with a variety of training and technical assistance to
improve their capacity to govern. As of December 2006, we
identified more than 50 capacity development efforts led by at
least six U.S. agencies. However, it is unclear how these efforts
are addressing core needs and Iraqi priorities in the absence of
an integrated U.S. plan.
Iraq also faces difficulties in spending budgeted funds for
capital goods and projects in the security, oil, and electricity
sectors. When the Iraqi government assumed control over its
finances in 2004, it became responsible for determining how more
than $25 billion annually in government revenues would be
collected and spent to rebuild the country and operate the
government. However, unclear budgeting and procurement rules have
affected Iraq's efforts to spend capital budgets effectively and
efficiently. Since most of the U.S. reconstruction funds provided
between fiscal years 2003 and 2006 have been obligated, unexpended
Iraqi funds represent an important source of additional financing.
Iraq had more than $6 billion in unspent capital project funds as
of August 2006. For example, Iraq's Oil Ministry spent only $4
million of $3.6 billion in budgeted funds to repair Iraq's
dilapidated oil infrastructure.
The inability to spend this money raises serious questions for the
government, which has to demonstrate to citizens who are skeptical
that it can improve basic services and make a difference in their
daily lives. The U.S. government has launched a series of
initiatives in conjunction with other donors to address this issue
and improve ministry budget execution.
Impact of the War on U.S. Military Readiness
Since September 11, 2001, U.S. military forces have experienced a
high pace of operations to support homeland security missions,
Operation Enduring Freedom in Afghanistan, and various combat and
counterinsurgency operations in Iraq. These operations have
required many units and personnel to deploy for multiple tours of
duty and, in some cases, to remain for extended tours. DOD faces
significant challenges in maintaining readiness for overseas and
homeland missions and sustaining rotational deployments of duty,
especially if the duration and intensity of current operations
continue at the present pace.
Ongoing military operations in Iraq are inflicting heavy wear and
tear on military equipment. Some equipment items used by U.S.
forces are more than 20 years old, and harsh combat and
environmental conditions over time have further exacerbated
equipment condition problems. The Army and the Marine Corps have
initiated programs to reset (repair or replace) equipment and are
likely to incur large expenditures in the future. We are currently
assessing these programs, including the extent to which the
military services are tracking reset costs and the extent to which
their reset plans maintain unit equipment readiness while meeting
ongoing operational requirements.
Problems in Securing Munitions Sites and Providing Force Protection
U.S. ground forces in Iraq have come under frequent and deadly
attacks from insurgents using weapons such as improvised explosive
devices (IED), mortars, and rocket launchers. IEDs, in particular,
have emerged as the number one threat against U.S. forces. Because
of the overwhelming size and number of conventional munitions
storage sites in Iraq, combined with prewar planning assumptions
that proved to be invalid, there were an insufficient number of
U.S. and coalition troops on the ground to prevent the widespread
looting of those sites. The human, strategic, and financial costs
of the failure to provide sufficient troops on the ground have
been high, since IEDs made from looted explosives have caused
about half of all U.S. combat fatalities and casualties in Iraq
and have killed hundreds of Iraqis. In addition, unsecured
conventional munitions sites have helped sustain insurgent groups
and threatened the achievement of the Operation Iraqi Freedom's
(OIF) strategic goal of creating a stable Iraqi nation.^9
DOD's actions to date have primarily focused on countering IEDs
and not on the security of conventional munitions storage sites as
a strategic planning and priority-setting consideration for future
operations. Although good first steps, these actions do not
address what we believe is a critical OIF lesson learned: If not
secured during initial combat operations, an adversary's
conventional munitions storage sites can represent an asymmetric
threat to U.S. forces that remain in country.
In December 2006, we recommended that the Chairman of the Joint
Staff conduct a theaterwide survey and risk assessment regarding
unsecured conventional munitions in Iraq and incorporate
conventional munitions storage site security as a strategic
planning factor into all levels of planning policy and guidance.
DOD partially concurred with our recommendations.
Efforts to protect U.S. ground forces with increased body and
truck armor have been characterized by shortages and delays, which
have reduced operational capabilities and forced combat commanders
to accept additional risk in completing their missions.^10 We are
currently reviewing force protection measures, including body
armor, for current operations, as well as the organization and
management of the Joint IED Defeat to counter the IED threat.
In prior reports, we recommended that the process for identifying
and funding urgent wartime requirements be improved and that
funding decisions be based on risk and an assessment of the
highest priority requirements. More recently, we have recommended
actions to ensure that the services make informed and coordinated
decisions about materiel solutions developed and procured to
address common urgent wartime requirements. DOD generally agreed
with these recommendations.
Improving DOD Acquisition Outcomes
DOD has relied extensively on contractors to undertake major
reconstruction projects and provide logistical support to its
troops in Iraq. Despite making significant investments through
reconstruction and logistics support contracts, this investment
has not always resulted in the desired outcomes. Many
reconstruction projects have fallen short of expectations, and DOD
has yet to resolve long-standing challenges in its management and
oversight of contractors in deployed locations. These challenges
often reflect shortcomings in DOD's capacity to manage contractor
efforts, including having sufficiently focused leadership,
guidance, a match between requirements and resources, sound
acquisition approaches, and an adequate number of trained
contracting and oversight personnel.
The challenges encountered in Iraq are emblematic of the systemic
issues that DOD faces. In fact, GAO designated DOD's contract
management activities as a high-risk area more than a decade ago
and have reported on DOD's long-standing problems with its
management and oversight of support contractors since 1997.^11 For
example, because information on the number of contractor employees
and the services they provide is not aggregated within DOD or its
components, DOD cannot develop a complete picture of the extent to
which it relies on contractors to support its operations. DOD
recently established an office to address contractor support
issues, but the office's specific roles and responsibilities are
still being defined.
In assessing acquisition outcomes government-wide over many years,
we have applied a framework of sound acquisition practices that
recognizes that a prerequisite to having good outcomes is to match
well-defined requirements and available resources. Shifts in
priorities and funding invariably have a cascading effect on
individual contracts. Further, to produce desired outcomes with
available funding and within required time frames, DOD and its
contractors need to clearly understand DOD's objectives and needs
and how they translate into the contract's terms and conditions;
they need to know the goods or services required, the level of
performance or quality desired, the schedule, and the cost. When
such requirements were not clear, DOD often entered into contract
arrangements that posed additional risks. Managing risks when
requirements are in flux requires effective oversight, but DOD
lacked the capacity to provide sufficient numbers of contracting,
logistics, and other personnel, thereby hindering oversight
efforts. With a considerable amount of DOD's planned construction
work remaining and the need for continued logistical support for
deployed forces, it is essential to improve DOD's capacity to
manage its contractors if the department is to increase its return
on its investment.
GAO�s Quality Assurance Framework
GAO's value to the Congress and the American people rests on its
ability to demonstrate professional, independent, objective,
relevant, and reliable work. To achieve this outcome, we set high
standards for ourselves in the conduct of our work. Our core
values of accountability, integrity, and reliability describe the
nature of our work and, most importantly, the character of our
people. In all matters, GAO takes a professional, objective, and
nonpartisan approach to its work. GAO's quality assurance
framework is designed to ensure adherence to these principles.
The framework is designed around people, processes, and technology
and applies to all GAO work conducted under generally accepted
government auditing standards. GAO has a multidisciplinary staff
of approximately 3,200 accountants, health experts, engineers,
lawyers, national security specialists, environmental specialists,
economists, historians, social scientists, actuaries, and
statisticians. GAO leverages this knowledge by staffing
engagements with teams proficient in a number of areas. For
example, engagement teams comprise a mix of staff supported by
experts in technical disciplines, such as data collection and
survey methods, statistics, econometric modeling, information
technology, and the law. To add additional value and mitigate
risk, GAO has a forensic audits and special investigations team to
expose government fraud, waste, and abuse.
A key process in our quality assurance framework is providing
responsible officials of audited agencies with the opportunity to
review and comment on our draft reports. This policy is one of the
most effective ways to ensure that a report is fair, complete, and
constructive.
In April 2005, an international peer review team gave our quality
assurance system a clean opinion--only the second time a national
audit institution has received such a rating from a multinational
team. Thus, the Congress and the American people can have
confidence that GAO's work is independent, objective, and
reliable. The team, under the auspices of the Global Working Group
of national audit institutions, examined all aspects of GAO's
quality assurance framework. The team found several global "better
practices" at GAO that go beyond what is required by government
auditing standards. These practices included its strategic
planning process, which ensures that GAO focus on the most
significant issues facing the country, serious management
challenges, and the programs most at risk.
The team identified other noteworthy practices:
o GAO's audit risk assessment process, which determines the level
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o GAO's agency protocols, which provide clearly defined and
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As an organization in constant pursuit of improvement, we
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Concluding Observations
Our work highlights the critical challenges that the United States
and its allies face in the ongoing struggle to help the Iraqis
stabilize, secure, and rebuild their country. Forthright answers
to the oversight questions we posed in our report of January 9,
2007, are needed from the U.S. agencies responsible for executing
the President's strategy. Congress and the American people need
complete and transparent information on the progress made toward
achieving U.S. security, economic, and diplomatic goals in Iraq to
reasonably judge our past efforts and determine future directions.
For future work, GAO will continue to provide this committee and
Congress with independent analysis and evaluations and coordinate
our efforts with the accountability community to ensure
appropriate oversight of federal programs and spending.
Mr. Chairman, this concludes my statement. I would be pleased to
answer any questions that you or other members may have at this
time.
GAO Contacts and Acknowledgments
For questions regarding this testimony, please call Joseph A.
Christoff at (202) 512-8979. Other key contributors to this
statement were Nanette Barton, Donna Byers, David Bruno, Dan Cain,
Lynn Cothern, Tim DiNapoli, Mike Ferren, Rich Geiger, Tom Gosling,
Whitney Havens, Lisa Helmer, Patrick Hickey, Henry L. Hinton Jr.,
John Hutton, Steve Lord, Judy McCloskey, Tet Miyabara, Mary
Moutsos, Ken Patton, Sharon Pickup, Jason Pogacnik, Jim Reynolds,
Donna Rogers, and William Solis.
^2GAO, Performance and Accountability Report: Fiscal Year 2006,
[28]GAO-07-2SP (Washington, D.C.: Nov. 15, 2006).
^3The six characteristics are (1) a clear purpose, scope, methodology; (2)
a detailed discussion of the problems, risks, and threats the strategy
intends to address; (3) the desired goals and objectives, and
outcome-related performance measures; (4) a description of the U.S.
resources needed to implement the strategy; (5) a clear delineation of the
U.S. government roles, responsibilities, and mechanisms for coordination;
and (6) a description of how the strategy is integrated internally among
U.S. agencies and externally with the Iraqi government and international
organizations. See Rebuilding Iraq: More Comprehensive National Strategy
Needed to Help Achieve U.S. Goals, GAO-06-788 (Washington, D.C.: July 11,
2006).
^4GAO, Rebuilding Iraq: DOD Reports Should Link Economic, Governance, and
Security Indicators to Conditions for Stabilizing Iraq. [29]GAO-06-217C
(title is unclassified, Washington D.C.: Oct. 31, 2005).
^5DOD's reported costs in Iraq do not include the costs of classified
activities.
^6Traditional security assistance programs operate under State authority
and are managed in country by DOD through security assistance
organizations under the direction and supervision of the Chief of the U.S.
Diplomatic Mission.
^7A property book is a formal set of property accounting records and
files.
^8DOD defines accountability as the obligation imposed by law, lawful
order, or regulation, accepted by an organization or person for keeping
accurate records, to ensure control of property, documents or funds, with
or without physical possession (DODI 5000.64, Accountability and
Management of DoD-Owned Equipment and Other Accountable Property, E2.2).
^9These issues are discussed in a classified GAO report, Operation Iraqi
Freedom: DOD Should Apply Lessons Learned Concerning the Need for Security
over Conventional Munitions Storage Sites to Future Operations Planning,
[30]GAO-07-71C (Washington, D.C.: Dec. 20, 2006). We plan to issue an
unclassified version of this report.
^10For further information on these issues, see GAO, Defense Logistics:
Actions Needed to Improve the Availability of Critical Items during
Current and Future Operations, [31]GAO-05-275 (Washington, D.C.: Apr. 8,
2005); Defense Logistics: Several Factors Limited the Production and
Installation of Army Truck Armor during Current Wartime Operations,
[32]GAO-06-160 (Washington, D.C.: Mar. 22, 2006); and Defense Logistics:
Lack of a Synchronized Approach between the Marine Corps and Army Affected
the Timely Production and Installation of Marine Corps Truck Armor,
[33]GAO-06-274 (Washington, D.C.: June 22, 2006).
^11GAO, Military Operations: High-Level DOD Action Needed to Address
Long-standing Problems with Management and Oversight of Contractors
Supporting Deployed Forces, [34]GAO-07-145 (Washington, D.C.: Dec. 18,
2006).
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References
Visible links
21. http://www.gao.gov/cgi-bin/getrpt?GAO-07-308SP
28. http://www.gao.gov/cgi-bin/getrpt?GAO-07-2SP
29. http://www.gao.gov/cgi-bin/getrpt?GAO-06-217C
30. http://www.gao.gov/cgi-bin/getrpt?GAO-07-71C
31. http://www.gao.gov/cgi-bin/getrpt?GAO-05-275
32. http://www.gao.gov/cgi-bin/getrpt?GAO-06-160
33. http://www.gao.gov/cgi-bin/getrpt?GAO-06-274
34. http://www.gao.gov/cgi-bin/getrpt?GAO-07-145
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