By Andrea Shalal-Esa
WASHINGTON, Sept 11 (Reuters) - U.S. Navy Secretary Ray Mabus said all Navy and Marine Corps weapons programs were being examined for possible cuts or cancellation if mandatory, across-the-board budget cuts remained in effect in coming years.
"Everything's got to be on the table. There are no sacred cows now," Mabus told military officers at the National Defense University in Washington. "No matter how well we do it, they're going to be incredibly hard choices."
Mabus urged lawmakers to give the Pentagon the flexibility to make choices about implementing $500 billion in cuts over the next decade.
Chairman of the Senate Armed Services Committee, Senator Carl Levin said he was hopeful of reaching a balanced deal to replace automatic, across-the-board spending cuts. He said a deal would have to include more spending cuts, reductions in entitlement programs and new revenues, possibly by closing tax loopholes.
Current law requires an across-the-board cut of all Pentagon spending accounts, which will not allow the services to prioritize their spending levels.
Mabus said the Navy was reviewing service contracts, which comprise one quarter of its annual spending of $160 billion.
He did not give examples of programs on the chopping block if mandatory cuts required under sequestration stayed in place, although he cited decisions in recent years to cancel the Expeditionary Fighting Vehicle developed by General Dynamics Corp for the Marines, and to truncate the five-year-old DDG 1000 destroyer program, also built by General Dynamics.
Defense officials say the Navy is looking at an array of options, including buying fewer coastal warships built by Lockheed Martin Corp and Australia's Austal, and delaying orders for the Navy's F-35 C-model, also built by Lockheed to land on aircraft carriers.
Lockheed, Austal and other Navy suppliers such as General Dynamics and Huntington Ingalls Industries Inc are awaiting news about how the Navy would cut spending in its fiscal 2105 budget plan now being prepared.
The services are working to finalize their plans in coming days so they can send them to top Pentagon leaders for review.
Mabus said the Navy was doing all it could to protect training and readiness, but warned that if the cuts stayed in place, sailors and Marines might have to deploy without adequate training within 12 to 18 months.
Training and maintenance had already been scaled back, while protecting funding needed for deployments, but the forecast cuts would eventually begin to affect those areas, he said.
He said naval forces remained in the Middle East at the ready to deal with Syria, but ongoing budget cuts could undermine the Navy's ability to provide those military options to the president in the future.
"Unless we act to address the damage of continuing resolutions and sequestration, there are options which may be limited or just not available in the future," Mabus said.
Continued budget cuts could force the Navy to eliminate more than three dozen planned maintenance periods for its warships, and ground more than 200 aircraft.
Mabus also warned that the Navy's efforts to rebuild its fleet and drive down acquisition costs would be jeopardized if budget cuts forced it to break multiyear acquisition contracts.