DEPARTMENT OF DEFENSE APPROPRIATIONS

FOR FISCAL YEAR 1983

THURSDAY, MAY 20, 1982

U.S. SENATE,

SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS,

Washington, DC.

The subcommittee met at 10:10 a.m., in room 1114, Everett McKinley Dirksen Senate Office Building, Hon. Ted Stevens (chairman) presiding.

Present: Senators Stevens and Rudman.

DEPARTMENT OF DEFENSE

DEPARTMENT OF THE ARMY

STATEMENT OF MAJ. GEN. STAN F. SHERIDAN, ASSISTANT DEPUTY CHIEF OF STAFF FOR RESEARCH, DEVELOPMENT AND ACQUISITION

ACCOMPANED BY:

MAJ. GEN. RICHARD W. ANSON, CHIEF, ARMY FORCE MODERNIZATION OFFICE, OFFICE OF THE DEPUTY CHIEF OF STAFF FOR OPERATIONS AND PLANS

MAJ. GEN. LOUIS C. MENETREY, DIRECTOR OF REQUIREMENTS, OFFICE OF THE DEPUTY CHIEF OF STAFF FOR OPERATIONS AND PLANS

BRIG. GEN. PHILLIP H. MASON, DEPUTY DIRECTOR, COMBAT SUPPORT SYSTEMS, OFFICE OF THE DEPUTY CHIEF OF STAFF FOR RESEARCH, DEVELOPMENT AND ACQUISITION

BRIG. GEN. DONALD S. PIHL, DEPUTY DIRECTOR OF WEAPONS SYSTEMS, OFFICE OF THE DEPUTY CHIEF OF STAFF FOR RESEARCH, DEVELOPMENT AND ACQUISITION

ARMY MODERNIZATION

WEAPONS MODERNIZATION PROGRAM

Senator STEVENS. Good morning, gentlemen. Sorry to be a little late, we have just finished another hearing. I am happy to have you here this morning on the Army's weapons modernization program.

We have supported substantial increases in both development and acquisition, but there is now growing concern on the committee that the overall costs of bringing in so many new systems at one time-literally in less than a decade-may be more than our budget limitations can accommodate.

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There are some real problems developing on modernization-cost overruns, program delays, rapidly expanding support costs. We want to try to explore some of this as much as time permits. I think you are all familiar with the rising, sharply rising, development and acquisition costs now showing up in your budget.

BUDGET REQUEST

The fiscal year 1983 request for procurement of $17.8 billion and the estimate for R.&D. of $4.5 billion are 67 percent above the 1981 level. Current weapons acquisition planning will drive these accounts even higher over the next 4 to 5 years in our opinion, less evident but even more dramatic cost increases for operating and supporting these systems will occur before this decade is over.

So, we want to start examining not only these weapons systems themselves, but the Army's ability to manage them. The capacity of the budget not only to absorb them, but to afford them for operations purposes once they are acquired.

With that, General Sheridan, I want to assure you that we are not antagonists. We find the unwelcome task of trying to comply with the budget directives of the full Congress-the Senate first and the full Congress later. That is going to take some hard decisions on our part that we would like to have your assistance on, helping us formulate opinions as to what priority should be in this budget in the event we have to make some substantial reductions. General, your full statement will be printed in the record. We will be happy to have you highlight in any way you desire. I assume that the reporter does have the names of the other gentlemen with you. If you have anyone else participating, we would appreciate if you would identify them for the record.

Thank you very much.

ARMY RESEARCH, DEVELOPMENT, AND PROCUREMENT PROGRAMS General SHERIDAN. Thank you very much, Mr. Chairman.

Let me say, it is a pleasure for us to appear before your committee this morning in order to make some very short presentations on selected subjects which we were informed the committee is interested in. But most importantly, we want to respond to your questions about how the Army is managing its research, development, and procurement programs in general, why we need selected items of equipment, and how we are going about the chore of managing the modernization which you just described.

Can I have those two charts, please?

TRENDS IN ARMY MODERNIZATION

We are most encouraged, though, by the favorable trend started by the 1981 supplemental and the 1982 amended budget. If those trends are continued I think we can all be assured of fielding a modernized Army that can cope with a variety of potential conflicts.

These two charts, which summarize the Army's procurement and R&D budgets for 1981 through 1983, clearly show those trends.

We also recognize that you are in the midst of dealing with a myriad of budget issues which have far-reaching implications in every sector of our country. We understand the complexities of your task and trust that our appearance here today will serve to assist you in resolving questions that you may have about selected Army programs, and at the same time assure you that we are efficiently managing the resources with which we are entrusted.

FY 83 BUDGET REQUEST
($ IN MILLIONS)

WEAPON SYSTEM PROCUREMENT PLANS

This is a list of systems that your staff indicated would have special interest to you today during the hearing. It is also my understanding that the committee has special concerns about weapon system procurement plans, how they tied to Air-Land Battle 2000; the light division concepts, as well as the fielding aspects of modernization management.