U.S. Plans:  Defense Department May Budget For Missile Procurement

Responding to criticism from government auditors, the U.S. Defense Department may begin allocating money in future budgets to buy missiles currently under development by the Missile Defense Agency, Inside Missile Defense reported today (see GSN, June 5).

Agency officials said the military services do not currently budget for procurement because they do not know if missile systems will be transferred to them.

Glenn Lamartin, director of defense systems for the undersecretary of defense for acquisition, technology and logistics, commented on a General Accounting Office recommendation to earmark money for missile procurement in future budgets.

“Doing so would not only promote the stability of the overall defense budget, but would also significantly improve the likelihood that an element or component would actually be fielded,” Lamartin wrote in an April 17 response to the GAO.  “The department will certainly consider this option for elements and components that have demonstrated sufficient maturity to enter into production,” he added.

In its report, the GAO warns that not laying out the costs in advance could force cuts in other programs down the line, Inside Missile Defense reported (Thomas Duffy, Inside Missile Defense, June 11).

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South Korea:  Defense Official Wants Independent Missile Defense System

A top South Korean defense official said yesterday that Seoul should develop its own missile defense system and not just rely on U.S. efforts to provide a missile defense shield (see GSN, June 5).

“We need to build our own capabilities regardless of requests from the United States,” said Deputy Defense Minister for Policy Lt. Gen. Cha Young-koo.  “However, the United States has not yet made any proposal on our participation in the MD,” he added.

Cha said the U.S. Patriot missiles already stationed in South Korea should not dissuade Seoul’s efforts.

“We need to establish our own capability and we have a mid- and long-term plan for that,” he said.  Cha also supported a U.S. request that Seoul increase its defense spending to more than 3 percent of its gross domestic product (Xinhua News Agency, June 10).

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U.S. Plans:  Failed December Missile Defense Test Costs $45 Million

U.S. defense contractor Boeing lost $45 million in bonus money last December when a test of the developing U.S. missile defense system failed (see GSN, Dec. 11, 2002).

The test failed because the warhead, built by Raytheon, did not separate from the booster rocket.  The problem was linked to a design change made by a Raytheon subcontractor two years ago, according to Patricia Sanders of the Missile Defense Agency.

The potential Boeing bonus for a successful test was $48.4 million.

“We were not pleased,” Sanders said.  “A lot of profit is really in the award fee, and that is a very big message to both Boeing and Raytheon — they didn’t make the profit and they won’t make that up,” she added.

Technicians at Pacific Scientific in California removed a small piece of foam to allow easier access to the warhead’s inner workings, but that foam was necessary to brace equipment that severed the bonds with the booster.  The uncushioned equipment broke after the missile was fired.

“This falls into the category of ‘no detail being too small,’” Sanders said.

Raytheon lost its bonus as well, but did not disclose the amount.  Raytheon officials will increase their monitoring of subcontractor work, the company said (Tony Capaccio, Bloomberg.com, June 9).

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U.S.-Russia:  Congress to Decide Implementation of Joint Program

The U.S. Congress is expected to hold a conference committee this summer to decide how to implement the Russian-American Observation Satellite (RAMOS) program, Defense Week reported today (see GSN, Nov. 6, 2002).

The joint RAMOS program is intended to design, build and launch two observation satellites for civilian and military use.  No formal U.S.-Russian agreement on the program exists, even though talks began in 1992, according to Defense Week.

The Senate version of the fiscal 2004 defense authorization bill funds the $29.6 million request made by the U.S. Missile Defense Agency for the program, but it also delays $5 million of those funds until a formal government-to-government agreement is reached, Defense Week reported.

“The committee intends this restriction to provide an appropriate incentive to the Russian Federation to reach an agreement,” the Senate Armed Services Committee said in a report on the bill.

The House version of the defense authorization bill does not contain a similar restriction on funds for the RAMOS program (Ann Roosevelt, Defense Week, June 9).

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U.S. Plans:  Congress Might Combine Patriot, MEADS Programs

The U.S. Congress might combine two prominent missile defense efforts and move a large chunk of Army funding to the Missile Defense Agency, Space & Missile reported today.

The House and Senate conference committee will decide this summer whether to merge the developing, multinational Medium Extended Air Defense program with the existing Patriot missile defense system.

Germany and Italy, which are developing the MEADS program with the United States, withheld reaction until a decision is made.

“It appears to us that the discussion in the U.S. has not really come to a close yet, so there is no official reaction as of now, but we do follow the debates very closely,” said Alexander Lambsdorff, a spokesman for the German embassy in Washington.

Under Pentagon plans, MEADS would begin replacing Patriot batteries in fiscal 2012.  The Senate Armed Services Committee, however, wants Patriot to continue service and the panel is pushing for technology developed under MEADS to be shifted into the Patriot program.  The committee also wants $276 million moved from MEADS to the Patriot effort.

“The committee is concerned that the parallel pursuit of PAC-3 spiral development and the MEADS development program does not represent a coherent approach to the further development of terminal phase ballistic missile defense,” the Senate panel said.

In its fiscal 2004 authorization, the committee cut $276 million from the Army’s MEADS development and $175 million from the Army’s Patriot development, and put $415 million into the MDA’s coffers for Patriot development.

The Bush administration opposed the move.

The transfer “would detract from MDA’s primary responsibility of ballistic missile defense and would impede progress in PAC-3 and MEADS, particularly for their roles in air defense,” the White House’s Office of Management and Budget said in a statement (Ann Roosevelt, Space & Missile, June 9).

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