Pentagon underestimates Afghanistan by $10 billion, holds war request until May

The Defense Department underestimated the cost of the Afghanistan war in fiscal 2013 by as much as $10 billion, the Pentagon’s top budget official said on Wednesday, and lacking clarity on the number of troops that will remain in the country next year, DOD will not submit a fiscal 2014 budget request for the war to Congress until next month.

The budget blunder, combined with sequestration’s mandated cuts and the fact that Congress has not passed an FY13 appropriations bill, posed yet another challenge for defense officials crafting the FY14 Defense Department spending request, which was released on Wednesday.

“I can’t believe how many things we’re trying to do right now,” Comptroller Robert Hale said.

Pentagon documents show DOD requesting $88 billion for the Overseas Contingency Operations (OCO) account, formerly known as the Global War on Terror. But the documents caution the request is “a placeholder pending submission of a final OCO request.”

“Here there’s a simple story about fiscal ’14 OCO budget: We don’t have one yet,” Hale said.

Pentagon officials have pledged to protect the war from sequestration cuts, which means DOD must cut more money from the military’s so-called “base” budget.

Hale said that for fiscal 2013, which has been funded through a series of continuing resolutions passed since September, the Pentagon estimates coming up short in Afghanistan by $7 to 10 billion, with half of the fiscal year already passed. So DOD will pull funds from the base budget to make up that loss in the final six months to go, he said.  With sequestration, the total shorfall to DOD’s active base FY13 operating budget adds up to between $22 billion and $25 billion.

“We are spending more in our OCO budget than we anticipated two years ago when it was put together, both through the higher operating tempo and higher transportation costs,” Hale said at the Pentagon.

Looking ahead, President Obama requested $526.6 billion for all FY14 defense spending, a 0.9 percent drop from DOD’s current estimates. But those are only a rough estimates.

The budget request for the Afghanistan war has always been a bit of a guessing game based on the number of U.S. troops deployed during each fiscal year. This is the second year in a row that the Defense Department has come up short.

Last summer, DOD asked Congress for permission to shift $8 billion in FY12 funds to cover unexpected costs across the department, including $770 million to pay for higher-than-anticipated gas prices related to the war. DOD said costs skyrocketed also because Pakistan closed the border into Afghanistan for NATO war supplies, forcing the military to execute a costly end-around supply route through the Northern Distribution Network.  

The new request assumes “for pricing only” that the 34,000 troops President Obama said he would withdraw from Afghanistan next year will not be pulled until the end of fiscal 2014, a year from September.