* Cites his interpretation of recent White House
* Such an outcome could help spare high-priority programs
By Jim Wolf and Richard Cowan
WASHINGTON, Sept 25 The U.S. Defense Department
may have more flexibility to cope with what it has painted as a
potentially devastating across-the-board spending cut, the
department's chief financial officer said Tuesday.
Robert Hale, the Pentagon's comptroller, said he interpreted
preliminary guidance from the White House to mean the Pentagon
may dodge its worst fear: an indiscriminate lop of 9.4 percent
from all of its more than 2,500 programs or projects.
He said the White House Office of Management and Budget's
instructions in a Sept. 14 report, would give the Pentagon
latitude to make such cuts within each overall budget account,
rather than program by program.
If so, this would let the Pentagon protect higher-priority
arms programs, for instance, by cutting more elsewhere in its
The ability to pick and choose program cuts to meet overall
budget constraints "would give us more flexibility," Hale said
in a brief interview after speaking at a forum in suburban
Arlington, Virginia, hosted by Government Executive magazine.
"But it's a preliminary report so we're not yet sure how
about how it would be defined," he said, referring to pending
final instructions for carrying out the spending cuts.
The Defense Department has about 50 budget accounts,
including such things as active Army operation and maintenance,
Navy reserve operation and maintenance and Air Force Guard
operation and maintenance.
Another example of a budget account is Army weapons and
Hale declined to discuss which programs the Pentagon might
cut more deeply given the managerial discretion to do so.
The across-the-board cuts known as sequestration are
scheduled to kick in on Jan. 2, forcing the department to chop
its spending by about $54.7 billion in fiscal 2013 on top of
cuts already being carried out under a broad budget
deficit-reduction deal enacted into law in August 2011.
Paired with a matching cut in spending on non-defense
domestic programs, this would be the first installment of a
10-year, $1.2 trillion reduction in previously projected
The idea behind sequestration was to prod ideologically
opposed lawmakers into a more thoughtful, targeted way to curb
annual budget deficits that have topped $1 trillion in recent
Defense Secretary Leon Panetta has urged Congress to call
off the automatic spending cuts, going so far as warning last
year that it was a "crazy doomsday mechanism" and "goofy
meat-axed approach" that would have a devastating impact on
Asked by Reuters about such comments, Hale said they were
based on a fear of the inflexible nature of the sequester law
before the OMB instructions that he read as more flexible.
The Sept. 14 OMB report cited by Hale says on its first page
that, with the sole exception of military personnel accounts,
the administration "cannot choose which programs to exempt, or
what percentage cuts to apply" if the automatic spending cuts
"The administration does not support these cuts, but unless
Congress acts responsibly, there will be no choice but to
implement them," the OMB report said.
Asked to comment on any discrepancy, a spokeswoman for
Hale's office said there was none.
The sequestration law requires that a breakdown by "Program,
Project and Activity," or PPA, be used for sequestration, said
Lieutenant Colonel Melinda Morgan, a Pentagon spokeswoman.
"However, PPAs are defined differently across the
government," she said by email, adding that a final definition
for PPAs has not yet been determined.