Our View: Military's account books in shambles

August 1, 2013 

Defense Cuts

In this photo taken July 17, 2013, Defense Secretary Chuck Hagel, flanked by Air Force personnel, walks down the rear ramp of a C-17 at Joint Base Charleston near Charleston, S.C., on the last day of a three-day trip to visit bases in the Carolinas and Florida. When Hagel told civilian Department of Defense workers on the base that job furloughs, that have forced a 20% pay cut on most of the military's civilian workforce, will likely continue next year, and may get even worse, the audience softly gasped in surprise and gave a few depressed low whistles. He said that if the department has to absorb another $52 billion in cuts next year because of the federal sequester, there will likely be layoffs instead of furloughs. (AP Photo/ Bruce Smith)


The Department of Defense is an organization whose bookkeeping is in such disarray that it defies auditing.

The lack of oversight in an organization whose annual budget exceeds $650 billion is troubling enough.

But an investigative report by Reuters earlier this month drew attention to a hidden cost of the Defense Department's troubles: widespread mistakes in pay and benefits for military service members.

The department is responsible for paying soldiers during their time in uniform and after they leave the service. But its system is riddled with holes, Reuters reporters Scot Paltrow and Kelly Carr found.

Defense Department payroll errors mistakenly dock soldiers' pay or burden them with debt they never incurred. Individuals on every level are affected, from privates to four-star generals.

California's congressional delegation should lead the way in solving the problem, if for no other reason than this state is home to more than 100,000 active-duty personnel, about 58,000 reservists and National Guard members and an estimated 2 million military retirees.

Rep. Buck McKeon, a Republican who represents parts of Ventura and Los Angeles counties, leads the House Armed Services Committee. Seven other Californians also serve on the committee, a significant bloc of votes and one that needs to make paying soldiers a priority.

The precise cost of the payroll mistakes is not clear, because of "the Defense Department's jury-rigged network of mostly incompatible computer systems for payroll and accounting, many of them decades old, long obsolete, and unable to communicate with each other," Reuters reported.

The Defense Finance and Accounting Service, which oversees pay and benefits for millions of military personnel, relies on the Defense Joint Military Pay System, a computer system from the early 1970s. The system uses COBOL, an antiquated programming language created in 1959. Outdated computer systems are pervasive in the Defense Department, noted Asif Khan, director of financial management and assurance at the U.S. Government Accountability Office.

Attempts to overhaul the 50- plus-year-old payroll system have failed. The most comprehensive effort began in 1997, but was canned by the Pentagon in 2010 after years of development and a $1 billion price tag.

Apparently, no inexpensive fix is available. But obstacles posed by the inefficiencies within the Defense Finance and Accounting Service highlight persistent problems with the organization's accounting.

In biennial reports dating to 1995, the GAO has labeled as "high risk" the department's financial management practices. Those practices are a major obstacle in assessing the federal government's overall financial state.

The last attempted and ultimately unsuccessful audit of the Department of Defense was in 1997. New deadlines for audit readiness have been set for 2014 and 2017, but it is unclear whether they will be met.

Regardless, service members need some basic assurance that they will be correctly paid. No one should work for less than their proper pay, least of all men and women who risk their lives in defense of their country.

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