Overseas Civilian Contractors

News and issues relating to Civilian Contractors working Overseas

Troops or Private Contractors: Who Does Better in Supplying Our Troops During War?

Charles M. Smith for Truthout Wednesday February 23, 2011

In testimony before the House on March 11, 2010, Undersecretary of Defense for Acquisition, Technology and Logistics, Dr. Ashton B. Carter, stated, “All studies show that that [organic support, i.e. using troops] is more expensive than contractors and a distraction from military functions for military people.”(1)

While this is sometimes an accurate statement, the Army should not just automatically choose contractor support over organic support without serious and honest additional analysis. With the continuing experience of extensive LOGCAP logistics support for Afghan and Iraq wars, the Army has the opportunity to re-evaluate decisions to use contractors for combat service support. The main support contractor for most of the time of these current wars, KBR, has had many failed reviews and received much criticism by DoD investigators and Congress. With the price tag of KBR’s LOGCAP contracts hitting above $40 billion, there are many lessons to be learned from their cost and performance failures. Such a review can evaluate the additional risks posed by contractors on the battlefield, along with any cost savings.

Cost Comparison

The major cost comparison study of troop versus KBR LOGCAP support was performed by the Congressional Budget Office (CBO) in 2005. This study was performed during the first two years of combat in Iraq and had significant data. The CBO compared Task Order 59 on the LOGCAP III contract, which provided support to Joint Task Force Seven (CJTF-7), the initial designation of troop units in Iraq. Task Order 59 accounted for over 50 percent of LOGCAP costs during the two years it was in effect.

The CBO estimated the number of Army units necessary to carry out the full range of tasks which Task Order 59 provided for JTF-7. They determined that “177 units of 38 distinct types, populated by 12,067 soldiers” would be required. They took into account units already in the military force structure, but unavailable because they are assigned to other missions, such as Korea. For their model, CBO assumed a 20-year period with two contingency operations and two periods of peacetime, in which units were trained and reconstituted. They calculated the cost per soldier, with the average length of service and the accumulation of veterans and retirement benefits. Unlike previous studies, the CBO factored in the different costs of reserve and regular Army units.

Based on these calculations, the cost of troop support would be $78.4 billion for the 20-year period. LOGCAP support is calculated to cost $41.4 billion for this period. Based upon the CBO calculations, the cost difference over a 20-year period would be $37 billion dollars, in 2005 dollars. The study found that organic support costs approximately 90 percent more than using contractors.

The CBO study examined a variety of operational scenarios, differing lengths for missions and peacetime, and found that the cost differential was not sensitive to these variations. The study is, however, extremely sensitive to a major assumption of the analysis, the Army’s rotation schedule. The Army policy is for a three-year rotational schedule. One year is spent performing a mission, followed by a year of reconstitution and a year of training for the next mission. Given this schedule, each unit created to replace the LOGCAP contract must have two other similar units to complete the rotation cycle. If the Army could live with a two-year rotational schedule for support units, the cost differential between organic support and LOGCAP would be significantly reduced especially since, in reality, the Army has not strictly kept to a three-year schedule and many of our troops are on their fifth or sixth deployment to Iraq or Afghanistan.

Please read the entire article/report here

February 23, 2011 Posted by | Afghanistan, Civilian Contractors, Contractor Corruption, Contractor Oversight, Government Contractor, Halliburton, Iraq, KBR, LOGCAP, Pentagon, Wartime Contracting | , , , , , | Leave a comment