The Pentagon's acquisitions chief said Monday that defense contractors are still stuck in a slowdown despite the initial steps by states and the Trump administration to re-open an economy in lockdown over the COVID-19 pandemic.
"We continue to assess a three-month slowdown to all programs due to COVID-19," Ellen Lord, the undersecretary of defense for acquisitions and sustainment, said at a Pentagon briefing.
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She gave many of the same estimates and even used the same phrasing that she employed at an April 30 Pentagon briefing to describe the virus' impact on the Major Defense Acquisition Program portfolio and the Defense Industrial Base.
While she said there have been minor improvements on completing contracts on time domestically, Lord added, "We continue to see the greatest impacts both domestically and internationally in the aviation and shipbuilding supply chains."
She declined to name any of the programs affected. "I won't discuss any program specifically, but we have seen inefficiencies across most programs," Lord said.
The pandemic has resulted in "shutting down defense manufacturing facilities and production lines, disrupting supply chains and distressing the financial stability of the companies DoD relies on to protect the nation," she said.
Lord cautioned against describing the slowdowns as delays in meeting contract deadlines. "I continue to use the term 'slowdown,'" she said, "and did not say the word 'delay,' which carries a very different connotation."
Out of the 21,922 defense firms tracked by the Defense Contracting Management Agency and the Defense Logistics Agency (DLA), 33 have closed down, and another 928 have closed and then re-opened, Lord said.
She gave many of the same figures on the Defense Department's procurement of COVID-19 supplies that she gave to the House Armed Services Committee in April.
On April 30, Lord stated that the DLA had procured 5.9 million N95 respirator masks, 14.2 million non-medical and surgical masks, 92.2 million examination gloves, 2.4 million isolation and surgical gowns, and 8,000 ventilators.
On Monday, she said the procurement of N95 respirator masks, non-medical and surgical masks, and ventilators was unchanged, but the DLA now had 118 million examination gloves and 2.7 million isolation and surgical gowns.
Lord also added a note of uncertainty to the DoD's plan to reimburse defense contractors for payments to employees who were prevented from working due to facility closures or other factors during the pandemic.
At a hearing before the House Armed Services Committee on June 11, she estimated those costs in the "double-digit billions of dollars" and said Congress should consider a supplemental appropriation to come up with the funding.
On Monday, Lord gave the same "double-digit billions of dollars" on the costs and said a request has been submitted to the White House Office of Management and Budget.
However, when asked whether the funding would come from a supplemental or from the DoD's budget, she would not speculate.
"We are analyzing things on a day-by-day basis, so I'm really not going to conjecture," Lord said.
-- Richard Sisk can be reached at Richard.Sisk@Military.com.
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