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Analysis of the FY 2018 Defense Budget – Procurement

Although increased capacity and lethality are the second priority of the Pentagon’s PB 2018 budget request behind restoring the readiness of the current force, funding for procurement increases far less than for RDT&E and operation and maintenance accounts (O&M) in real terms.[1] In the PB 2018 request, the Trump administration asked for a total of $125.2 billion in procurement funds, with $115 billion in the base discretionary budget and an additional $10.2 billion in Overseas Contingency Operations (OCO). This is $9.04 billion (or 7.8 percent) more than anticipated for FY 2018 in the PB 2017 request. However, the PB 2018 request is only 0.65 percent larger than Congress appropriated for procurement in FY 2017, an increase of $819 million (see Figure 6-1). Per Secretary Mattis’ memorandum on DoD budget guidance, the National Defense Strategy (NDS), currently being developed, will include a new force sizing construct that will “inform our targets for future force structure growth.” Accordingly, PB 2019, driven by the results of the NDS, will contain “ramps to grow the force quickly but responsibly.”[2] This phased approach to increasing the size of the military means that any substantial growth in procurement funding over prior years’ budgets will occur in the PB 2019 budget request at the earliest, rather than in PB 2018.

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