The Navy’s flat fiscal year 2022 budget request prioritizes readiness and future investment over current capabilities, according to a Navy official.
When accounting for inflation, the Navy’s fiscal year 2022 budget request, at $212 billion, stands flat compared to the current year, mirroring how the total FY ‘22 Defense Department budget request is also flat versus the current year at about $715 billion. Last Friday, a Navy official explained some decisions were made both to funnel more funds into readiness and R&D while due to a flat budget, some hard choices were made on capabilities.
“Budgetary constraints continue to force prioritization of requirements and the Department made a strong commitment to reform initiatives, harvesting savings for reinvestment. During the budget bill we realigned tens of billions of dollars toward higher priority programs and divestment of legacy capabilities,” Deputy Assistant Secretary of the Navy for Budget Rear Adm. John Gumbleton said during a press conference.
The Navy is requesting eight new ships but only 4 are combat vessels, including only one new Arleigh Burke-class destroyer at a cost of $2 billion, instead of maintaining the two-per year plan. In contrast, the Navy’s FY ‘21 budget request plan expected to procure two destroyers in the FY ‘22 budget at a cost of $3.7 billion.
Gumbleton said requesting only one new destroyer reflects the need to make priorities.
He said “this was absolutely an affordability question where the goal of the department was to balance the first priority, which is investment in Columbia recapitalization. A second priority, which is to prioritize readiness to deliver a credible combat force for today, investment, leasability, and modernization, and then grow the warfighting capacity at a rate supported by our budget controls.”
“When you ask the question with respect to the second DDG, this was clearly a hard choice with respect to what we could afford as we build the Navy for the ’22 budget,” Gumbleton continued.
He confirmed if the Navy only procures the single destroyer in FY ‘22, there will be a $33 million multi-year penalty for not maintaining the 10-year multiyear procurement plan with two ships per year.
“The hard choice being that the Navy chose to invest the cost of the destroyer in a blended mix of readiness, modernization, and capability for the future.”
Gumbleton underscored readiness as a Navy Department priority and said “FY ‘22 signifies a change for the Department’s gains on ship and aircraft maintenance.”
The Navy decided to fund those accounts up to what it can afford rather than the previous model of what the Navy could execute.
“Focus on performing to plan has led to maintenance availabilities trending up for on-time delivery,” Gumbleton continued. “These ship maintenance improvements are a result of better contracting strategies” with an Office of Personnel Management pilot project and more accurate availability duration planning, he said.
The budget increases the Navy’s ship maintenance account by 6 percent over last year’s budget to go, in part, toward private contracted submarine maintenance for the Los Angeles-class submarines USS Hartford (SSN-768), Boise (SSN-764) and Columbus (SSN-762).
Funding for ship operations would increase 7 percent, which Gumbleton said “will support additional carrier strike group deployments with additional steaming days, as well as the associated increase and repair parts.”
The service also plans to save $1.3 billion through divesting several capabilities earlier than previously planned, including decommissioning two further Ticonderoga-class cruisers (CG-66 and 68), the USS Whidbey Island (LSD-41) dock landing ship, and divesting the littoral combat ships (LCS) 3, 4, 7 and 9 (Defense Daily, May 28).
Gumbleton said these savings will be rolled back into the FY ‘22 budget for other priorities, but did not name specifics.
“Recognizing though, that this is a ’22 only budget, so, therefore, we can’t comment on that. But much of those savings for the divestment of those ships are really a fit of profile, the operations sustainment costs, and so we can’t comment on the future fit of them. But those resources are being rolled back into the Navy’s program for future investment in what we believe is the best lethality and capabilities we need for both modernization and investment for the future.”
Notably, the overall FY ‘22 DoD budget request did not include the Future Years Defense Program (FYDP) outlook in its request, which usually lays out the five-year plan for major programs. DoD presented the request this way because the Defense Department and White House are conducting a new Global Force Posture Review to update the 2018 National Defense Strategy, which could change plans. The result is any savings from divestments directed towards future year activity are not public yet.
“So there are savings in ’22, and those are rolled right back into, again, readiness, finalization, and investments, but the larger scale of those savings do occur in the FYDP, and those will be decided during our POM ’23 budgets,” Gumbleton said.
While the budget request is seeking to deactivate two more cruisers, the Navy had already planned to deactivate five cruisers in the coming years, he said. Adding two more cruisers “represent $1.5 billion over the FYDP. And so we’re seeking to divest those two additional cruisers to reallocate those funds to other priorities,” he added.
He also clarified why the Navy is requesting to retire LCS-7 and 9, beyond the previously requested retirements of LCS-1 and 2.
“So as they looked at LCS, LCS-5 happened to just have a maintenance availability and we’re putting a Naval Strike Missile on it and it’s getting ready for a deployment,” Gumbleton said. “And so we looked at, for the total of four to reinvest those funds across the FYDP, and 7 and 9 were the most suitable ships for that reason.”
Gumbleton was also asked if the Navy is still seeking a 355-ship Navy, given the eight ship procurement request combined with the planned additional divestments.
“I would tell you that eight ships a year is not going to get to 355,” he replied. “And so all things being equal, if you have a 300-ship Navy and a 30-year life, you have to recapitalize at 10 per year and so eight is not going to do it.”
He added this year’s budget is consistent with the previous year’s request of eight ships as well.
“We’re requesting eight this year again. But we have to manage. Again, it’s all about not having a hollow force, making sure we’re ready today, modernizing for tomorrow and then the investment for the future. And with this top-line allocated, this is the right blend to do that.”
Gumbleton said both this and planned future years budgets “are all extraordinarily reform-minded,” given expectations of constrained budgets.
“As we look at a pressurized budget going forward we really have to maximize every penny. And so looking hard at our programs, what we’re investing in reform initiatives, whether it’s ‘Perform to Plan’ or otherwise, to invest in the right blend of readiness, modernization investments starts with these efficiencies.”