The Navy has continued to accept delivery of ships containing hundreds and in some cases thousands of deficiencies despite recent efforts to improve quality control, and is not adequately pressuring contractors to minimize the number of flaws, according to a report released Tuesday.

The Government Accountability Office report (GAO-14-122) said the Navy should adapt more commercial practices that require the ship builder to assume greater risk for deficiencies and shoulder the cost of correcting them. The GAO said the commercial side does a better job of detecting flaws and ensuring they are corrected while the ship is being built rather than at the time of or after delivery.

“The Navy pays hundreds of millions and in many cases billions of dollars for ships that warfighters rely on to perform as expected under stressing conditions,” the report said. “Yet it routinely accepts ships with numerous uncorrected deficiencies. Addressing these deficiencies after delivery can be costly, time consuming, and disruptive.”

A GAO report released Tuesday says the Navy accepts too many deficiencies on delivered ships. Photo by U.S. Navy

The report said the Navy’s contracting standards for quality control are inconsistent and called for a more coordinated effort within Naval Sea Systems Command (NAVSEA), the outfit responsible for acquiring ships, and among its inspection teams to harness greater quality control and consistent standards in contracting.

The GAO noted that in 2009 NAVSEA introduced a “Back to Basics” initiative to address the problem, and said it has made some progress in helping the command reduce levels of major flaws known as “starred” deficiencies, but is still overly willing to accept vessels with large numbers of glitches or errors.

The GAO, for example, said the USS San Diego (LPD-22), a San Antonio-class amphibious transport dock ship in program that has had a history of quality control problems, delivered in 2011 without any starred deficiencies but still had more than 3,300 minor flaws that had to be corrected at delivery.

“In recent years, Navy leadership has increased its focus on reducing what it considers to be the most serious deficiencies (“starred deficiencies”) at the time of ship delivery with some notable successes,” the GAO report said. “However, the continued practice of accepting ships with a substantial number of deficiencies differs from the commercial practices we observed and can be attributed to differing interpretations of what Navy policy requires.”

“Navy policy officials focus on provisions addressing delivery of the ship to the Navy, while program officials focus on the provisions addressing the much later point at which full financial responsibility for the ship is transferred to the operating fleet,” it said. “This suggests that clarification and consistency in practice is needed.”

NAVSEA spokesman Chris Johnson said the GAO report is being evaluated while pointing out that the Navy continues to strive to bring down the deficiency numbers.

“The Navy is still reviewing the report,” Johnson said. “However, the report correctly notes that the Navy has made significant improvements to its shipbuilding practices and there has been a decrease in the number of deficiencies discovered during acceptance trials.”

The GAO said that having to correct problems after delivery disrupts the Navy’s ability to integrate the ship into fleet operations.

The report highlighted commercial standards to apply firm fixed priced contracts to their builders, believing that “the risks to the quality belong with the shipbuilder.” That’s in contrast to the Navy’s practice of cost-reimbursement and fixed priced incentive contracts that leave less risk on the shipbuilder, the GAO said. The GAO said the Navy should at least tie incentives to quality control.

The GAO said the Navy has initiated plans to examine how commercial practices can be applied to military shipbuilding. The agency said the Navy in January issued an information request from industry seeking ways to apply commercial practices on future amphibious warships, and working with commercial standards outlined by the American Bureau of Shipping. This included the feasibility of using commercial practices for as much of the ship as possible and applying military standards only where necessary.

Huntington Ingalls Industries [HII] and General Dynamics [GD] are the main contractors for Navy ships.