Operation Iraqi Freedom: Preliminary Observations on Iraqi	 
Security Forces' Logistical Capabilities (09-MAR-07,		 
GAO-07-582T).							 
                                                                 
The National Strategy for Victory in Iraq, issued in November	 
2005, implies a conditions-based linkage between the development 
of the Iraqi Security Forces (ISF) and the size and shape of the 
U.S. presence there. The Department of Defense (DOD) reported to 
Congress in November 2006 that although the Iraqi Ministry of	 
Defense and Ministry of Interior had about 323,000 trained and	 
equipped forces, there was a serious shortcoming for both	 
Ministries in the planning and executing of their logistics and  
sustainment requirements. According to DOD, without a developed  
logistical system the ISF will require continued Coalition	 
support. Today's testimony addresses (1) the current state of the
ISF's logistical capabilities, and (2) the challenges the ISF is 
facing to achieve logistical self-sufficiency. This testimony	 
contains unclassified portions of a classified report that was	 
issued on March 7, 2007. GAO's preliminary observations are based
on audit work performed from January 2006 through March 2007.	 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-07-582T					        
    ACCNO:   A66666						        
  TITLE:     Operation Iraqi Freedom: Preliminary Observations on     
Iraqi Security Forces' Logistical Capabilities			 
     DATE:   03/09/2007 
  SUBJECT:   Defense capabilities				 
	     Equipment maintenance				 
	     Foreign governments				 
	     Logistics						 
	     Military facilities				 
	     Military forces					 
	     Military training					 
	     Protective equipment				 
	     Strategic planning 				 
	     DOD Operation Iraqi Freedom			 
	     Iraq						 
	     National Strategy for Victory in Iraq		 
	     Iraqi Security Forces				 

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GAO-07-582T

   

     * [1]Summary
     * [2]Background

          * [3]Ministry of Defense Has Approved a Logistical Concept, but I

               * [4]Underdeveloped National and Regional Logistics Centers
                 and t
               * [5]Training of Iraqi Logisticians Poses Challenges
               * [6]Maintenance Is Challenged by Diversity of Vehicle Fleet
                 and

          * [7]Ministry of Interior Has Drafted a Logistics Concept, but It

               * [8]MOI's Warehousing and Supply Infrastructure Requires
                 Continu
               * [9]MOI Is Unable to Independently Maintain its Vehicles and
                 Equ

     * [10]Concluding Observation
     * [11]GAO Contact and Staff Acknowledgments
     * [12]GAO's Mission
     * [13]Obtaining Copies of GAO Reports and Testimony

          * [14]Order by Mail or Phone

     * [15]To Report Fraud, Waste, and Abuse in Federal Programs
     * [16]Congressional Relations
     * [17]Public Affairs

Testimony

Before the House Armed Services Committee, Subcommittee on Oversight and
Investigations

United States Government Accountability Office

GAO

For Release on Delivery Expected at 9:00 a.m. EST

March 9, 2007

OPERATION IRAQI FREEDOM

Preliminary Observations on Iraqi Security Forces' Logistical Capabilities

Statement of William M. Solis, Director
Defense Capabilities and Management

GAO-07-582T

Mr. Chairman and Members of the Subcommittee:

I am pleased to be here today to discuss issues related to the development
of the Iraqi Security Forces' (ISF) logistical capabilities. Logistics is
the lifeblood of any military organization. It is the process of planning,
implementing, and controlling the efficient, effective flow and storage of
goods, services, and related information from point of origin to point of
consumption for the purpose of conforming to operational requirements and
the sustainment of the operations to the successful accomplishment of the
mission or task. The components of logistics are sustainment, maintenance,
supply, transportation, services, and health support.

In November 2005, the National Security Council issued the National
Strategy for Victory in Iraq, which states that the Coalition will adjust
its "posture and approaches as conditions evolve and Iraqi capabilities
grow," and that Coalition troop levels in Iraq will decrease over time as
the Iraqis take on more responsibilities for themselves. The national
strategy implies a conditions-based linkage between the development of the
ISF, including its logistical and other support capabilities, and the size
and shape of the U.S. presence in Iraq. Currently, much of the discussion
on the size and shape of U.S. forces in Iraq has focused on the
relationship between trained and equipped Iraqi Security Forces and U.S.
combat brigades. However, Coalition and U.S. support forces are providing
extensive combat service support to the ISF. In February 2006, the
Department of Defense (DOD) issued its third report to Congress, Measuring
Stability and Security in Iraq, and stated that with the generation of
regular line infantry battalions in the Iraqi Army largely completed, the
focus of the train-and-equip program was shifting toward building combat
support and combat service support units. In its next report to Congress,
issued in May 2006, DOD stated that more than 65 percent of personnel in
the Iraqi Army's support forces had been trained and equipped and that
logistics units were continuing to increase in capability. However, in
August 2006 DOD reported that logistics capabilities continued to be an
area of significant concern for the Iraqi Police Service, particularly
with respect to vehicle maintenance, and that extensive support to Iraqi
military forces was being provided by Multi-National Force-Iraq. In its
most recent report to Congress, issued in November 2006, DOD stated that
although the Iraqi Ministry of Defense (MOD) and Ministry of Interior
(MOI) had about 323,000 trained and equipped forces, the most serious
shortcoming for both ministries' capabilities lay in planning and
executing their logistics and sustainment requirements. According to DOD,
fiscal year 2007 is the "Year of Leaders and Logistics" in Iraq. In
justifying much of the $5.8 billion in its supplemental Fiscal Year 2007
Security Forces Fund request and its Fiscal Year 2008 Security Forces Fund
request, DOD has pointed out that without the funds designated for MOD and
MOI logistics and sustainment functions the Coalition would have to
continue to support the ISF.

In response to the growing interest by members of Congress, we began a
review under the authority of the Comptroller General to conduct
evaluations at his own initiative^1 in order to provide information on the
status and challenges of developing ISF support capabilities. To determine
the status and challenges we reviewed relevant documents, orders,
policies, and data that we obtained from DOD, the Department of State, and
contracting officials. We also met with and interviewed DOD officials and
contractor representatives in the United States and made two trips to
Iraq, in January and August of 2006. While in Iraq we met with officials
from the Department of State, Office of the Secretary of Defense (OSD),
Multi-National Force-Iraq, Multi-National Corps-Iraq, and Multi-National
Security Transition Command-Iraq. During our August 2006 trip, we also met
with Iraqi Army officials and made a site visit to an Iraqi Army training
compound and Iraq's National Depot. We determined that the data we have
used are sufficiently reliable for the purposes of this report. This work
is being done in accordance with generally accepted government auditing
standards.

Our classified report, Operation Iraqi Freedom: Preliminary Observations
on Iraqi Security Forces Support Capabilities ( GAO-07-120C ), which also
includes preliminary observations on the ISF's intelligence and command
and control capabilities, was issued on March 7, 2007. I will be
presenting here some unclassified portions of that report, updated with
information we obtained in December 2006 and February of 2007, on the
development of the ISF's logistical capability. We will be conducting
further, follow-on engagement work on this subject.

Summary

Although the Ministry of Defense has an approved logistics concept in
place, the implementation of that concept has been hampered by numerous
challenges. For example, the development of national and regional
logistics centers has lagged behind the development of other unit-level
logistics formations. Coalition logisticians have emphasized to us that
the development of all echelons of the logistics concept--national and
regional logistics centers and unit-level logistics formations--is crucial
in order for MOD to become capable of independently sustaining its forces.
Furthermore, the policies and procedures intended to guide implementation
of the logistics concept have not been disseminated. In addition, the
training of Iraqi logisticians and mechanics has been hindered by an
insufficiency in the supply of Arabic-literate students, of fuel needed to
power generators, and of Iraqis who are qualified to serve as faculty at
the logistics schools. Finally, maintenance of the vehicle fleet poses
challenges because of the fleet's diversity, the shortage of trained
mechanics, and the Ministry's failure to budget for and maintain an
authorized stockage level for equipment.

^1 31 U.S.C. S 717(b)(1) (2000).

As of December 2006, the Ministry of Interior has not approved the draft
logistics concept that has been proposed by the Coalition. The reason for
this is unclear. What is clear, however, is that since the summer of 2006,
the Ministry has experienced significant challenges in its warehousing and
supply, and maintenance activities. For instance, in July 2006, the
Coalition was procuring and distributing equipment, vehicles, and weapons
for the MOI, in addition to funding a contractor to run warehouses and
transport supplies to MOI facilities. These challenges have continued, and
the MOI remains dependent on the Coalition to operate its warehouse
system. In February, the MOI was supposed to assume responsibility for
running its warehouses. However, this has not happened. Another example of
the Ministry's continuing challenges is vehicle maintenance. In August
2006 MOI personnel were unable to maintain a certain type of American
truck supplied to the Ministry by the Coalition because its personnel were
unable to work with the vehicles' computerized systems. As of August 2006,
the MOI had 1,179 trucks of this type on hand. According to a December
2006 DOD update, Iraqi mechanics remain unfamiliar with the computerized
systems which are found in most of the Ministry's vehicles.

Background

In early 2005, the Ministry of Defense and Multi-National Force-Iraq
approved a logistics concept for the Iraqi military. Inherent to the
concept is the generation of a variety of organizations, from the
ministerial to the unit level. The provision of logistics support at the
lowest levels is expected to be the purview of, first, Headquarters and
Services Companies, which provide limited health, maintenance, supply, and
transportation support to Iraqi Army battalion, brigades, and divisions;
and, second, Motorized Transport Regiments, which provide additional
transportation, maintenance, and vehicle recovery support to each of the
Iraqi Army's infantry divisions. Midlevel logistics support is expected to
come from a national depot, five Regional Support Units (RSU), and
numerous Garrison Support Units (GSU). The national depot, located at
Taji, provides facilities for the receipt, storage, accounting, and issue
of most classes of supply for the Iraqi Armed Forces, as well as the
maintenance capability to overhaul vehicles and other equipment. RSUs are
to provide regionally focused supply, maintenance, and contract support
for the Iraqi military, while GSUs are to provide base support for each
Iraqi military installation. A Support Command provides command and
control of the national depot and RSUs, while the Iraqi Joint Headquarters
logistics staff section provides logistics input to plans and orders.
Finally, atop the logistics structure is the Office of the Director
General of Acquisitions, Logistics, and Infrastructure, which is expected
to direct the overall logistical capability and the acquisition of capital
equipment, develop ministerial policies and procedures, and manage the
budget. The envisioned end state is a comprehensive logistics system that
will provide maintenance, supply, transportation, medical, and garrison
support to all elements of the Iraqi military.^2

According to a December 2006 Multi-National Security Transition
Command-Iraq assessment, the Iraqi military will be self-sufficient in the
provision of fuel, uniforms, building supplies, and life support by
December 2007 at the latest. Additionally, the same assessment states that
foreign military sales will be used to attain Iraqi self-sufficiency in
the following areas: ammunition management and handling and the training
of ammunition managers and handlers; vehicle replacement and
modernization; the purchase and stocking of repair parts and the training
of repair parts managers; the development of the National Depot; and the
formation of a movement coordination center and shipment of supplies. All
of these foreign military sales cases are to be promulgated between March
and June 2007.

According to a Coalition document, the Ministry of Interior logistics
system envisioned by the Coalition would enable the central government to
procure and distribute commodities; would support both the MOI's federal
forces (National Police and Border Forces) and the forces based in each of
Iraq's 18 provinces (Iraqi Police Service, Facility Protection Service,
and Fire/Civil Defense); and would assume accountability for items such as
vehicles, weapons, and durable equipment.

^2 The areas of health and garrison support are not addressed in this
testimony.

The Coalition has developed this draft logistics concept for the Iraqi
police and border enforcement forces, but as of December 2006 it had not
been approved by the Ministry of Interior. Additionally, the Ministry is
working together to develop a centralized maintenance concept, but that
was still in process as of December 2006.

Ministry of Defense Has Approved a Logistical Concept, but Its Implementation
Faces Numerous Challenges

Several challenges remain in the implementation of MOD's logistics system.
First, the establishment of the national depot, regional support units,
and garrison support units has lagged behind the creation of Headquarters
and Service Companies and Motorized Transport Regiments. Second, the
policies and procedures to facilitate implementation of the logistics
concept have not been effectively disseminated. Third, the training of
Iraqi logisticians has been affected by a lack of fuel, electricity, and
personnel support for the training academy. Finally, the maintenance of
the Iraqi military's vehicles is complicated by the diversity of MOD's
fleet, the lack of trained mechanics, and the failure to budget for and
maintain an authorized stockage level for equipment.

  Underdeveloped National and Regional Logistics Centers and the Failure to
  Disseminate Policies and Procedures Hinder Iraqi Logistical Self-Sufficiency

The creation of national and regional logistics centers has lagged behind
that of lower echelon unit-level organizations because preference has been
given to the generation of lower echelon logistics organizations,
specifically Headquarters and Service Companies and Motorized Transport
Regiments.^3 According to Coalition officials, this makes the attainment
of MOD logistical self-sufficiency problematic. For example, the
establishment of the National Depot has been plagued by manpower
shortages, security issues, inadequate fuel stocks, and poor maintenance.
Coalition officials assigned to the National Depot told us in August 2006
that the quantity of fuel delivered there since April 2006 had been below
that needed to support routine warehouse, maintenance, and transportation
requirements. The maintenance of forklifts, vehicles, and generators
necessary to support day-to-day operations has suffered as well because of
a lack of spare parts, a situation exacerbated by the variety of makes and
models of equipment used by the National Depot. Additionally, the
infrastructure at the National Depot needs to be developed. In its
supplemental Fiscal Year 2007 Security Forces Fund request, DOD has asked
for a total of $339.2 million to build and develop maintenance, warehouse,
and base support facilities at the National Depot. According to DOD, if
these funds are not procured, the National Depot's construction will be
affected and the shortfall will necessitate the continued presence and
support of Coalition forces further into the future. In the words of one
senior Coalition logistician, what presently exists at Taji is "a depot in
name only."

^3 As of December 2006, 152 of 157 authorized Headquarters and Service
Companies have been formed and 7 of 9 Motorized Transport Regiments have
been transitioned to Iraqi control.

The standing up of the Regional Support Units and Garrison Support Units
faces similar challenges. According to a senior Coalition official with
whom we spoke in January 2006, all 5 RSUs were to be operational by the
end of calendar year 2006. But as of August 2006, the Ministry of Defense
was still in the process of forming the RSUs and all 5 had significant
shortfalls in personnel, leadership, training, and facilities. According
to updated information we obtained in December 2006, MOD was still
developing the RSUs and they would not be transitioned to full Iraqi
control until June 2007. In August 2006 MOD had not yet determined the
exact number of GSUs to be formed, and only 5 were in the process of being
formed. Updated information obtained from DOD in December 2006 revealed
that GSU development was still in an early stage, although the Iraqi Joint
Headquarters was taking aggressive action to accelerate the development of
23 GSUs. According to DOD, full transition of GSUs to Iraqi control will
not occur until late 2007. In its supplemental Fiscal Year 2007 Security
Forces Funds request, DOD has asked for $73 million to build and outfit 58
dining facilities on GSUs and RSUs. Without this funding, DOD states that
those facilities might go months or years without use while waiting for
equipment to be delivered through the Iraqi acquisitions systems.
According to DOD, if that were to occur the Coalition would not be able to
diminish its support.

Coalition logisticians have emphasized to us that the development of all
echelons of the logistics concept is crucial in order for MOD to become
capable of independently sustaining its forces. To that end,
Multi-National Security Transition Command-Iraq and Multi-National
Force-Iraq have developed Logistics Action Plans that include detailed
event trackers and delineate Coalition decision points throughout the
year. Overseeing implementation of the Logistics Action Plans is the
purview of the Logistics Concept Implementation Committee, an entity
formed in March 2006 to develop policies and procedures and steer their
implementation. The Logistics Concept Implementation Committee is composed
of both Iraqi and Coalition General Officers, and it meets fortnightly. As
of December 7, 2006, the Logistics Concept Implementation Committee had
produced 27 policies, procedures, and plans. However, according to DOD
officials, MOD does not have an effective process for disseminating the
policies and procedures throughout the Iraqi military. We do not know the
reason for this.

  Training of Iraqi Logisticians Poses Challenges

Providing trained officers and noncommissioned officers to fill support
and combat service support positions throughout the Iraqi Army is the
mission of the Iraqi Armed Service and Supply Institute (Institute).
However, during our August 2006 visit to the Institute we found several
problems that negatively affected its ability to fulfill its mission. One
such problem, according to a senior Iraqi Army official from the
Institute, is Arabic illiteracy. At least 25 percent of the students who
report for each course, including students from the Kurdish provinces who
are literate in their own language, are turned away because they cannot
read the required manuals, written in Arabic.^4

Quality-of-life problems also hamper training. There is not enough fuel
for the generators that provide the power necessary to run air
conditioners, water pumps, and other life-support functions. According to
an OSD report, the Taji RSU, which supports the Iraqi Armed Service and
Supply Institute, was so starved for fuel that the generators were allowed
to run only for 12 hours out of 24. During one 24-hour period, most
generators had no fuel at all.

Furthermore, the number of trained Iraqis is not sufficient for training
the number of logisticians required by the Iraqi military. As of August
2006, the Iraqi Armed Service and Supply Institute was staffed with just
over half of its authorized Iraqi officer instructors. Lacking the needed
faculty, the Institute has had to operate at less than full capacity,
resulting in the training of fewer logistics specialists for the Iraqi
Army. The reasons for this shortage remain unclear.

  Maintenance Is Challenged by Diversity of Vehicle Fleet and Undermined by a
  Lack of Trained Mechanics and MOD Budgeting for Authorized Stockage Levels

Vehicle maintenance is another challenge that MOD faces, one exacerbated
by the heterogeneous mixture of the Ministry's vehicular fleet. This
diversity evolved because the fleet was assembled variously from vehicles
left over from Saddam's army, MOD vehicle purchases, and vehicle gifts
received from donor countries. According to an August 1, 2006, vehicle
inventory, the Iraqi Army has 6 different types of fuel trucks, at least 4
of which come from different manufacturers: Nissan, Ford, KrAZ
(Ukrainian), and MAZ (Belarusian); 21 different types of light utility
vehicles, including vehicles manufactured by Chevrolet, Gazelle (Russian),
Honker (Czech), Kia, Mercedes, Mitsubishi, Nissan, and UAZ (Russian); and
15 different types of medium cargo vehicles, including U.S. military 2.5-
and 5-ton cargo trucks. It also has vehicles manufactured by AMC, Ashok
Leyland (Indian), GAZ (Russian), Hyundai, Kamaz (Russian), Nissan, and
Mercedes. According to Coalition officials, obtaining repair parts for
such a heterogeneous vehicular fleet, especially for vehicles of non-U.S.
manufacture, is so expensive that crews have preferentially taken needed
parts from similar vehicles awaiting repair. The result is that some
vehicles never get repaired.^5 Furthermore, vehicle maintenance in some
Iraqi Army units is adversely affected by the low octane rating in the
fuel they are receiving. According to an OSD report, some units in the
Kirkuk region are receiving fuel with an octane rating of between 70 and
78. As a result, fuel pumps are failing and the units are forced to change
fuel filters every 7 to 10 days.

^4 As a result of the literacy problem within the country, Multi-National
Security Transition Command-Iraq has developed a literacy course.

As an interim solution to meet the maintenance requirements of this
diverse fleet, Multi-National Security Transition Command-Iraq committed
to a national maintenance contract. According to the statement of work,
the command's intent was to contract the services of a maintenance
contractor to support the sustainment of the vehicles and equipment issued
to the Iraqi Armed Forces and to assist the Iraqi Armed Forces in becoming
self-sufficient. To facilitate the transfer of organizational and
intermediate maintenance tasks, the designated contractor was to be
organized to conduct on-the-job training for Iraqi personnel. However,
Coalition officials stated that this training regimen has not yet produced
sufficient numbers of trained Iraqi mechanics.

The national maintenance contract's statement of work also requires the
contractor to determine and maintain an adequate authorized stockage level
for all equipment repaired, the intent being to reduce the "wait time" for
parts. Coalition officials we spoke with in August 2006 said that although
an authorized stockage level has been completed, updated, and partially
funded by the Coalition, MOD has not yet budgeted for maintaining it once
the contract expires in March 2007. Coalition officials fear that a
failure by the Iraqis to budget for and maintain the authorized stockage
level will result in repair part shortfalls, which in turn will have a
negative impact on equipment readiness levels. In its supplemental Fiscal
Year 2007 Security Forces Fund request, DOD has asked for $499.6 million
to procure recommended levels of supplies initially required to meet Iraqi
wholesale and retail authorized stockage levels for most major classes of
supplies. If it does not receive this funding, DOD states that the Iraqis
will require continued support from Coalition forces.

^5 According to DOD's Fiscal Year 2008 Security Forces Fund request, a
portion of the $1,043 million it has requested for equipment and
transportation will be used to purchase common system vehicles for MOD,
with an eye toward reducing the fleet to just one or two systems.

Coalition officials have remarked that the national maintenance contract
is too expensive for MOD to continue past its March 2007 end date.
Coalition officials told us that they have presented an alternative to the
national maintenance contract based on foreign military sales and direct
vendor contracts to MOD. As of August 2006, MOD had taken no action with
regard to this alternative. However, according to a DOD official,
Multi-National Security Transition Command-Iraq has reprogrammed some of
its funds to extend the National Maintenance Contract beyond its March
2007 expiration date.

Ministry of Interior Has Drafted a Logistics Concept, but It Is Not
Self-Sufficient in Logistics

As of December 2006, the Ministry of Interior had not approved the draft
logistics concept that has been proposed by the Coalition. The reason for
this is unclear. What is clear, however, is that since the summer of 2006,
the Ministry has experienced significant challenges in its warehousing and
supply, and maintenance activities. Because of these challenges, the
Ministry is dependent on Coalition support for much of its logistics
requirements. If left uncorrected, these challenges will likely prolong
the Ministry's dependence on Coalition support into at least fiscal year
2008.

  MOI's Warehousing and Supply Infrastructure Requires Continued Coalition
  Support and Funding

In December 2006, DOD reported that the MOI warehouse system consists of
five warehouses operated by the Coalition, one that is planned for MOI
operation in late December 2006, and several additional warehouses at the
headquarters of both the Ministry and its Department of Border
Enforcement. According to DOD, each of the Provincial Directors of Police
offices is responsible for establishing its own warehouse.

Since the summer of 2006, MOI has depended on the Coalition and
contractors to run its warehouses and supply much of its forces. For
example, in July 2006, not only was the Coalition procuring and
distributing equipment, vehicles, and weapons for MOI, it was also funding
a contractor to run the supply distribution warehouses and provide the
transportation assets needed to get the supplies from the warehouses to
MOI facilities. According to a Coalition assessment, this state of affairs
was necessary because MOI's existing logistics capabilities were being
overwhelmed by the force the Coalition was developing for the MOI.

These challenges have continued, and MOI remains dependent on the
Coalition to operate its warehouse system. Although MOI was supposed to
assume responsibility for running these warehouses, this has not happened.
In August 2006, a Coalition-funded contractor was operating six warehouses
for MOI, and plans called for all six to transition to MOI control by
February 2007. However, according to an update we received from DOD in
December 2006, only one of the six warehouses will be transitioned to
Iraqi control by February 2007. The remaining five are to continue under
Coalition control until July 2007.

Moreover, it seems that MOI's dependence on Coalition support of its
logistics facilities will continue into fiscal year 2008. DOD states that
MOI requires approximately $175 million from the supplemental Fiscal Year
2007 Security Forces Fund for the construction and sustainment of
warehouses and maintenance depots. DOD states that without this funding,
the Ministry will be unable to sustain its warehouses, and the Coalition's
significant investment in the MOI vehicular fleet, comprising some 19,222
Coalition-supplied vehicles, will be put at risk. In addition, DOD is
seeking funding for MOI logistics projects in the Fiscal Year 2008
Security Forces Fund request.

  MOI Is Unable to Independently Maintain its Vehicles and Equipment

Maintenance is another area in which the MOI continues to face challenges.
As of December 2006, the MOI had at least two different vehicle
maintenance concepts. The first, for provincial police forces, directs
that vehicles be maintained at the provincial level. The second, for the
National Police, is still in development and is expected to be based on a
military model and centered in the Baghdad area. Although MOI is
developing a centralized vehicle maintenance concept, as of December 2006
this concept was not complete.

Since the summer of 2006, MOI has faced significant vehicle maintenance
challenges. For instance, in August 2006, Coalition officials told us that
in Baghdad alone approximately 1,600 police vehicles were inoperable. In
addition, MOI personnel were unable to maintain a certain type of American
truck supplied by the Coalition because its personnel were unable to work
with the vehicles' computerized systems. As of August 2006, MOI had 1,179
trucks of this type on hand.

Based on our latest information, some of these challenges have persisted.
For instance, according to a December 2006 DOD update, Iraqi mechanics
remain unfamiliar with the computerized systems which are found in most of
the MOI's vehicles. Moreover, a significant component of the MOI's forces,
the National Police, is unable to maintain its vehicles.

Maintenance of communications equipment is another challenge that MOI has
faced since the summer of 2006. In August 2006, Coalition officials stated
that there was little or no sustainment for certain types of police radio
equipment but that plans called for MOI to fund a 12-month, $4.5 million
contract for radio maintenance and training of Iraqi communications
mechanics. The current status of this contract is unclear.

Based on recent DOD information, we believe that the Ministry's
maintenance challenges will keep it dependent on Coalition assistance into
fiscal year 2008. For instance, according to Coalition officials the
Multi-National Security Transition Command-Iraq has established the $130
million Baghdad Area Maintenance Contract to repair National Police
vehicles. According to Coalition officials, the contract is currently set
to expire in mid-2007, when MOI is supposed to assume responsibility for
maintenance of the National Police vehicle fleet. Another example is the
$145 million DOD is requesting to build 130 maintenance facilities for
MOI. DOD states that without this infrastructure the Ministry will not be
able to maintain its vehicle fleet. In addition, DOD is seeking funding
for MOI logistics projects in the Fiscal Year 2008 Security Forces Fund
request.

Furthermore, DOD has requested $27 million in U.S. funding for MOI
communications maintenance and has stated that without this money, MOI's
radio networks will be severely jeopardized, its first-responder network
will degrade and become inoperable, and it will be unable to assume
responsibility for its national command and control network.

Concluding Observation

The Coalition has been working steadily toward the goal of transferring
full security responsibility to the Iraqi military and police. During our
trips to Iraq we met with scores of dedicated military, DOD civilian, and
contractor personnel who work daily to redress the challenges we have
pointed out in this testimony. We believe, however, that much remains to
be done before the ISF is logistically self-sufficient. Until that
happens, the Iraqi Security Forces will continue to be reliant on the
Coalition to provide the support they cannot provide for themselves.
According to DOD's November 2006 report to Congress, the department has
increasingly focused on addressing these challenges by partnering Iraqi
logistics units with U.S. units and, within MOD, embedding civilian
advisors to assist MOD officials in developing MOD's capacity to organize,
train, equip, sustain, and upgrade its forces. Furthermore, the Government
of Iraq has increasingly turned to foreign military sales to execute
equipment and sustainment cases for both MOD and MOI. However, as we have
shown, several challenges have to be overcome in the areas of training,
maintenance, and sustainment before the Iraqis can become logistically
independent of the Coalition.

Mr. Chairman and Members of the Subcommittee, this concludes my prepared
statement. At this time, I would be happy to answer any questions that you
may have.

GAO Contact and Staff Acknowledgments

For questions regarding this testimony, please call William Solis at (202)
512-8365. Other key contributors to this statement were Marilyn Wasleski,
Guy LoFaro, Christopher Turner, and Cheryl Weissman.

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Highlights of [25]GAO-07-582T , testimony before the House Armed Services
Committee, Subcommittee on Oversight and Investigations

March 9, 2007

OPERATION IRAQI FREEDOM

Preliminary Observations on Iraqi Security Forces' Logistical Capabilities

The National Strategy for Victory in Iraq, issued in November 2005,
implies a conditions-based linkage between the development of the Iraqi
Security Forces (ISF) and the size and shape of the U.S. presence there.
The Department of Defense (DOD) reported to Congress in November 2006 that
although the Iraqi Ministry of Defense and Ministry of Interior had about
323,000 trained and equipped forces, there was a serious shortcoming for
both Ministries in the planning and executing of their logistics and
sustainment requirements. According to DOD, without a developed logistical
system the ISF will require continued Coalition support.

Today's testimony addresses (1) the current state of the ISF's logistical
capabilities, and (2) the challenges the ISF is facing to achieve
logistical self-sufficiency. This testimony contains unclassified portions
of a classified report that was issued on March 7, 2007.

GAO's preliminary observations are based on audit work performed from
January 2006 through March 2007.

Although the Ministry of Defense has an approved logistics concept in
place, the implementation of that concept has been hampered by numerous
challenges. For example, the development of national and regional
logistics centers has lagged behind the development of other logistics
formations because of manpower shortages, security issues, inadequate fuel
stocks, poor maintenance, and funding procurement issues. DOD has asked
for a total of $339.2 million to build and develop maintenance, warehouse,
and base support facilities at the National Depot and for $73 million to
build and outfit 58 dining facilities on Garrison Support Units and
Regional Support Units. Coalition logisticians have emphasized to us that
the development of all echelons of logistics units is crucial in order for
the Ministry of Defense to become capable of independently sustaining its
forces. Furthermore, the policies and procedures intended to guide
implementation of the logistics concept have not been effectively
distributed. In addition, the training of Iraqi logisticians and mechanics
has been hindered by an insufficiency in the supply of Arabic-literate
students, of fuel needed to power generators, and of cadre qualified to
serve as faculty at the logistics schools. Finally, maintenance of the
vehicle fleet poses challenges because of its diversity, the shortage of
trained mechanics, and the Ministry's failure to budget for and maintain
an authorized stockage level for equipment.

As of December 2006, the Ministry of Interior has not approved the draft
logistics concept that has been proposed by the Coalition. The reason for
this is unclear. What is clear, however, is that since the summer of 2006,
the Ministry has experienced significant challenges in its warehousing and
supply, and maintenance activities. For instance, in July 2006, the
Coalition was procuring and distributing equipment, vehicles, and weapons
for the Ministry, in addition to funding a contractor to run warehouses
and transport supplies to the Ministry's facilities. These challenges have
continued, and the Ministry remains dependent on the Coalition to operate
its warehouse system. In February, the Ministry was supposed to assume
responsibility for running its warehouses. However, this has not happened.
Moreover, in its fiscal year 2007 supplemental, DOD is requesting
approximately $175 million for the construction and sustainment of
Ministry warehouses and maintenance depots. Another example of the
Ministry's continuing logistical challenges is vehicle maintenance. In
August 2006 Ministry personnel were unable to maintain a certain type of
American truck supplied to the ministry by the Coalition because its
personnel were unable to work with the vehicles' computerized systems. In
August 2006, the Ministry had 1,179 trucks of this type on hand. As of
December 2006, Iraqi mechanics remained unfamiliar with these computerized
systems which are found in most of the ministry's vehicles. Because the
Iraqi National Police are not able to maintain their vehicles, the
Coalition has let and funded a $130 million Baghdad Area maintenance
contract to repair these vehicles.

References

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