The Army has put an immediate freeze on civilian hiring and will begin terminating some temporary employees to reduce spending ahead of potential across-the-board budget cuts later this year.
“The Army faces significant budgetary uncertainty in the coming months and must take immediate steps to reduce expenditures,” Army Chief of Staff Ray Odierno and Army Secretary John McHugh wrote in a Jan. 16 memo.
That uncertainty stems not only from the automatic sequester cuts — which go into effect March 1 unless Congress intervenes — but also from the possibility of a year-long continuing resolution, which limits annual spending to last year’s levels.
“We expect commanders and supervisors at all levels to implement both the guidance contained in this memorandum and the detailed instructions to follow,” wrote McHugh and Odierno. “The fiscal situation and outlook are serious.”
Along with the hiring freeze is a mandate to reduce base-operations support to about 70 percent of 2012 levels. The service is also curtailing professional training and conferences not deemed mission-critical.
The Army is also seeking to squeeze some savings from procurement accounts, particularly high-dollar value ones. Going forward, all production, research, development, testing and evaluation contracts exceeding $500 million require Undersecretary of Defense for Acquisition Technology and Logistics Ashton Carter’s approval.
Civilian furloughs, which the Army is not currently considering, would only be a “last resort” option, according to Odierno and McHugh. “Therefore, no action should be taken with regard to furloughs without the express approval of the secretary of the Army,” the guidance stated.
The guidance exempts wartime funding and Wounded Warrior programs from the cost-savings initiatives.
The Army’s guidance follows a number of recent steps taken by the Pentagon and the individual services to prepare their organizations for the fiscal quandary faced by agencies across government.
Last week, the Pentagon ordered DoD components to start coming up with strategies for conserving cash in case any of the worst-case budget scenarios play out.
In a joint letter to Congress this week, top DoD and military leaders wrote that the budget situation threatens the readiness of the armed forces.
“Under current budgetary uncertainty, we are at grave risk of an imposed mismatch between the size of our nation’s military force and the funding required to maintain its readiness, which will inevitably lead to a hollow force,” the letter stated.