Former Pentagon Comptroller Robert Hale said Aug. 29 that the overseas contingency operations (OCO) funding mechanism has served the Department of Defense well and should be retained with modest changes, even though it has been criticized in some quarters.
OCO was started in fiscal year 2011 to pay for the cost of war in Afghanistan and Iraq. Hale, DoD’s chief financial officer from 2009 to 2014, said that OCO has ensured that “all those actually involved in combat would have the resources they need.”
Some lawmakers charge that OCO has been used to cover non-war spending to get around budget caps, and Hale acknowledged that the base budget is a better vehicle than the annual OCO for addressing long-term needs. But he said that tightening OCO rules would shift tens of billions of dollars back to the capped base budget, which would trigger deep cuts in readiness and modernization that the military cannot afford.
Hale, who spoke on a panel at the Brookings Institution in Washington, D.C., said a more practical approach would be to transfer small amounts of money to the base budget. Such funding could be for newer initiatives not directly related to wartime activity, such as the Counterterrorism Partnerships Fund and the European Reassurance Initiative, which together total about $2 billion in FY 2016.
Hale, now a fellow at Booz Allen Hamilton [BAH], said OCO has promoted smoother financial management than the supplemental appropriations bills it was designed to replace. DoD did not send supplemental requests to Congress until the middle of the year they were needed, which often created cash-flow problems. DoD avoids such problems with OCO funding plans, which lawmakers receive well before the year they are needed.