Tens of thousands of blue-collar Defense Department workers are slated to receive their long-delayed 2024 pay raises. The raises were stalled for nearly a year after Defense Secretary Pete Hegseth’s purge of advisory committees halted the DoD Wage Committee’s ability to authorize new wage schedules.

The DoD Wage Committee met last week for the first time this year to approve publication of 2024 updates to about 1,600 wage schedules covering 250 wage areas. 

These raises will match the General Schedule locality increases, and they will be applied retroactively according to when they should have taken effect last year. DoD workers could see the pay bump reflected in their next paychecks.

“It will probably be in the next paycheck, or possibly a separate check. It will depend on which payroll processor is being used,” Jacqueline Simon, American Federation of Government Employees’ director of public policy, told Federal News Network. 

“There might be some other agencies, like the Bureau of Prisons, Social Security, even the Department of Veterans Affairs that might be more delayed. But I’m told the Defense Finance and Accounting Service says it will be the next paycheck,” she said. 

For blue-collar federal employees under the Federal Wage System, the process of getting a pay raise is more complex than for most General Schedule employees. While the GS base pay schedule is adjusted annually each January with an across-the-board pay increase set by the president or Congress, FWS adjustments are based partly on that overarching raise and partly on wage surveys conducted by the DoD Wage Committee, which then votes to implement new schedules region by region throughout the year.

But in March, Hegseth launched a review of all advisory committees, requiring them to justify their existence. He instructed the committees to explain how their advice “benefited the DoD, the federal government, and the United States,” and how it aligned with President Donald Trump’s goals and the department’s priority of “restoring the warrior ethos.” Hegseth dismissed all members of the advisory committees in April.

The DoD Wage Committee — made up of three agency officials and two union leaders, and whose sole function is to approve wage schedules for FWS employees — has been unable to meet since then.

“We don’t provide advice per se. We look through all the data, at the way the calculations were done, make sure everything was done right, and then you vote that yes, this is okay. And sometimes it’s not okay. Sometimes there are errors and they’re found. But that’s what the DoD wage committee is,” Simon said.

“The surveys happened, the calculation and the new wage scales and wage rates were determined, but none of them could be actually implemented or paid because of the pause on the advisory committees. Everything was ready to go. So people who were due their raise in March and April and May, in June, July, August, September, none of them got their raises when they were supposed to,” she added.

Simon said the Office of the Secretary of Defense never offered any explanation of why the committee could not be exempted. “They just wouldn’t do it. They were not permitted to meet with us,” she said.

It appears that pressure from lawmakers eventually pushed the department to reverse its course.

“We certainly talked to a lot of lawmakers, and we talked to as many people in the administration as we possibly could and tried to put some political pressure on the secretary, and I guess he finally relented,” Simon said. 

The delay, Simon said, has been deeply frustrating for workers. “Across the board, people were absolutely furious. There’s no way to overstate how angry and resentful people were that this was happening. And, of course, there was a hardship, of course there was the shutdown, and then this on top of it, and it was a terrible outrage.”

AFGE estimates that more than 118,000 DoD employees are paid through the Federal Wage System.

If you would like to contact this reporter about recent changes in the federal government, please email anastasia.obis@federalnewsnetwork.com or reach out on Signal at (301) 830-2747.

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Alex Karp vows to use his "whole influence" on immigration and defense policy.

Republicans are already spinning the report as a "nothing burger."

Even Republicans are calling for an investigation.

A new forecast projects that defense spending will keep rising through 2035, while civilian agencies face years of flat or shrinking budgets, continued cuts and growing pressure to scale back. 

The Professional Services Council’s latest federal market forecast, compiled with input from more than 400 industry volunteers and subject-matter experts, predicts that in an environment where legislative logjam is likely to persist, defense spending will continue rising at roughly 2% annually after its first $1 trillion budget in fiscal 2026 — a one-time spike driven by reconciliation —  while cuts will “continue to fall disproportionately on civil agencies until elections change the balance of power.”

“What this means in practical terms is that the fiscal environment for the next decade will be tight, competitive, highly dependent on supplemental funding, reconciliation and prone to crisis-driven appropriations. Base budgets alone will struggle to drive new initiatives, especially on the non-defense side. In this environment, as one of our interviewees suggested, it’s best to keep your customers close and your congressional supporters and lobbyists closer,” Mike Riley, a volunteer for PSC’s Vision Federal Market Forecast told reporters last week.

In the defense space, PSC volunteers said their discussions with defense stakeholders revealed a shift, or “strategic realignment,” in the Pentagon’s priorities. While the Indo-Pacific Command remains of “elevated importance,” the Northern Command and Southern Command are gaining new emphasis as the department puts greater focus on homeland, border security and expands its presence in Latin America and the Caribbean. 

“This year was a bit of an interesting year for us. A lot of defense folks acknowledge the growing importance under this administration, but also a lot of consternation about the directions the administration might be going and just kind of the lack of clarity. There’s some continuing trends — deterring China, integrated deterrence, that pivot to the Pacific — that’s an ongoing thing that didn’t change from the previous administration. Of course, border security, the Department finds itself in an uncomfortable position,” Jason Dombrowski, a volunteer for PSC’s Vision Federal Market Forecast, said.

“They are getting a little bit more heavily involved in domestic politics than they would otherwise prefer to. Certainly, they always reiterated their intent to be responsive to the commander in chief. But historically, of course, the American military has tried to avoid a domestic role,” he added.

The department is also placing greater emphasis on the Golden Dome missile defense system, shipbuilding and munitions under this administration.

“I think everyone’s been paying attention to the news that there has been some very notable plus ups and focuses of this administration, most notably around shipbuilding, but also to include things like nuclear modernization, which in previous years we had highlighted as a potential toss up, but this year definitely moved into the winners category,” Dombrowski said.

Acquisition reform

The Defense Department also moves to implement Defense Secretary Pete Hegseth’s sweeping acquisition reforms, which emphasize greater competition, faster delivery and making commercial technology the default option. It’s unclear whether the department has the ability to implement those changes given deep personnel cuts across the contracting workforce.

“The contracting professionals — there seems to be a large reduction. How do we get this done? That fundamental capacity to get things done is really going to make a difference, whether you’re putting out contracts, supply chain, workforce throughput … It’s going to affect how we can actually help out the government. Adaptability is the name of the game,”Jim Kainz, a PSC volunteer, said.

In addition, the department’s new acquisition strategy promises to lower barriers to entry to encourage startups and non-traditional vendors to join the defense industrial base. Dombrowski said that while stakeholders are cautiously optimistic about the reforms, there is also a “healthy cynicism of saying, ‘How is this time any different?’” 

“This administration has made a big priority of trying to attract new people, and we looked at the pros and cons of it. It’s probably worth noting that, aside from a few very notable successes that we can all figure out, there hasn’t really been much movement in this regard,” Dombrowski said. 

“We’re very excited, certainly [Commercial Solutions Opening] and [Other Transaction Authority] and just a variety of things that should provide a lot of flexibility, but let’s see it,” he added.

Winner and losers

Dombrowski and Kainz said several areas emerged as clear “losers” in this year’s defense outlook, including the department’s buying power, which continues to erode as inflation and reshoring efforts drive up costs across programs.

Legacy systems and advisory and assistance services are facing cuts, and U.S. Africa Command and Central Command are being pushed lower on the priority list as resources shift toward European Command.

There is also uncertainty around operations and maintenance funding, which Dombrowski and Kainz said remains a major concern for both think tanks and potential customers. Sustainability initiatives appear to be split — the “green side of sustainability” will most certainly lose ground, while efforts tied to energy resilience may gain momentum. 

Contested logistics, once considered a toss-up, is gaining traction as a priority, and scalability — the ability to rapidly increase production in a crisis — is emerging as a clear winner across the department.

Overall, research and development spending is increasing, but only in areas related to advanced weapon systems, technologies, drones and energy. 

“However, there’s a belief and a growing expectation that the contracting community will bear more of those responsibilities,” Dombrowski said. “It’s really unclear where that line is going to be drawn between things that are really government exclusive where DoD is willing to pick up all costs associated to it. There are things we can all imagine, like fighter jets. But what about things that are more in the gray areas? Avionics, business process systems, back-office systems, things like that — definitely more of a sense that we are going to have to be developing those on our own.”

If you would like to contact this reporter about recent changes in the federal government, please email anastasia.obis@federalnewsnetwork.com or reach out on Signal at (301) 830-2747.

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As the Defense Department moves to implement Defense Secretary Pete Hegseth’s sweeping acquisition reforms, Space Force leaders warn that the depth of workforce cuts is threatening to cripple the service’s ability to execute them.

“You have to have a strong, vibrant workforce to do the work and we’re in a really interesting time and a troubling time. There is a strong, motivated force but there have been an incredible amount of pressures on them this past year,” Maj. Gen. Stephen Purdy, acting assistant secretary for space acquisition and integration at the Department of the Air Force, said Nov. 20 during a Center for Strategic and International Studies event. 

“We have a looming increase in acquisitions coming down the pike, and so that presents us with a really difficult situation of where we need to double down on our acquisition workforce, our acquisition training. We are in a situation where we barely have enough acquirers to do all of the work that we have now,” he added.

Purdy said the service has spent the last few years implementing the acquisition tenets set by Frank Calvelli, who stepped down as assistant secretary of the Air Force for space acquisition and integration in January. Calvelli pushed the service to “build smaller satellites and smaller ground systems and minimize non-recurring engineering or new design.” He also preferred to use fixed-price contracts when possible. Calvelli’s “tenets” were a back-to-basics formula meant to fix chronic problems in space programs.

“We’ve built upon that this last year. We haven’t let grass grow under our feet as we’ve kind of taken over in January. And we’ve built upon that foundation and moved on out and really done a lot this year that kind of foreshadowed [Hegseth’s] acquisition reforms. But the workforce question is really the key piece,” Purdy said.

The Trump administration push to reduce the size of the federal workforce through initiatives such as the deferred resignation program and voluntary early retirement has had an “outsized impact” on the Space Force. In May, Chief of Space Operations Gen. Chance Saltzman told Congress the service had lost nearly 14% of its civilian workforce — much of it coming from Space Systems Command, the Space Force’s acquisition hub.

“I’m worried about replacing that level of expertise in the near term as we try to resolve it and make sure we have a good workforce doing that acquisition,” Saltzman told the Senate Armed Services Committee at the time. 

When asked about the acquisition workforce, Saltzman told reporters that these workforce reduction efforts have taken civilian experts “out of play,” leaving gaps in the institutional knowledge and technical skills.

As the Space Force begins implementing Defense Secretary Pete Hegseth’s acquisition overhaul, which calls for using commercial technology as the default option, great competition and faster delivery, Purdy warned the service may not have the workforce needed to shift to the new way of doing business. 

“If you look at [Hegseth’s] acquisition reforms that he’s laid out, a bunch of great initiatives and things we need to get after. But … you need the numbers of people, and you need the quality to understand. If you say ‘go commercial,’ and if you say, go after ‘new manufacturing mechanisms’ and take advantage of all of the new space companies that are out there, you need a larger number of people just to even track that activity. You need to be able to understand all that’s going on. You need to understand the incentive structure,” Purdy said.

The strain is particularly acute in contracting since the service simply doesn’t have enough contracting officers to handle a much larger workload created by recent acquisition reforms.

“In the past, if we had an acquisition program and we would go 20 years and it would be with one prime, we would maybe have one or two contracts, an R&D contract and a production contract. Pretty simple. One prime, a couple contracts. Now, with some of our programs there’ll be a five-year program, but we’ll probably have 20 contracts because I’m dealing with 10 or 15 different contractors in industry, which is literally what acquisition reform is telling us to do,” Purdy said.

“We have a serious issue here at a federal level on contracting and it’s just the numbers of folks. We do not have the numbers of contractors that we need at a federal level. Every federal agency has problems, and so we do not have the right numbers that we need,” he added.

Saltzman said the service is trying to ease the strain by requesting waivers to the hiring freeze that has been in place since the start of the Trump administration, as well as hiring authorities to fill essential acquisition and contracting roles.

The service also recently launched its first acquisition training course.

Kay Sears, vice president and general manager of space, intelligence and weapon systems development at Boeing, said that while the Space Force acquisition community is more open and collaborative than ever, it is also apparent that the service’s workforce is stretched thin.

“You can tell that they’re stressed. You can tell that they’re overworked. And then when you get into that contracting element that’s really where I see the slowdown, the, ‘Hey, I’ve only got one playbook — I’m going to go follow the playbook,’ and we really start to lose sight of the mission objective,” Sears said.

Acquisition experts have said that while the proposed acquisition changes could meaningfully reshape how the Pentagon buys capabilities, the success of Hegseth’s reforms will hinge on whether the department can equip the workforce with the skills needed to operate differently. 

“Scores of case studies have shown, there has to also be an aggressive, intentional and holistic approach to change management, prominently including how the relevant workforces are developed. Absent re-aligning those processes, real change will remain elusive,” Stan Soloway, president and CEO of Celero Strategies and federal acquisition expert, told Federal News Network.

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A government watchdog is sounding the alarm about a growing national security threat online. Rather than a traditional cyberattack, however, this one comes from the everyday digital footprints service members and their families leave across the internet. 

A new Government Accountability Office report warns that publicly accessible data — from social media posts and location tracking to Defense Department press releases — can be pieced together by malicious actors to identify military personnel, target their families and disrupt military operations.

According to GAO, while the Pentagon has taken some steps to address the threat, its efforts remain scattered, inconsistent and lack coordination. 

“We found that the department recognized that there were security issues, but they weren’t necessarily well-prepared to respond to them because it was new, because it didn’t necessarily neatly fit into existing organizational structures or policies or doctrines, and that’s a consistent story with the department,” Joe Kirschbaum, director of the defense capabilities and management team at GAO, told Federal News Network. 

To understand the risks posed to DoD personnel and operations that come from the aggregation of publicly accessible digital data, the watchdog conducted its own investigation and built notional threat scenarios showing how that information could be exploited. GAO began by surveying the types of data already available online and also assigned investigators to scour the dark web for information about service members. 

In addition to basic social media posts, investigators found data brokers selling personal and even operational information about DoD personnel and their families — information that can be combined with other publicly available data to build a more complete profile. 

“Once you start putting some of these things together, potentially, you start to see a pattern — whether it’s looking at individuals, whether it’s the individuals linked to military operational units or operations themselves, family members. Nefarious actors can take these things and build them into a profile that could be used for nefarious purposes,” Kirschbaum said. 

One of GAO’s threat scenarios shows how publicly accessible information can expose sensitive military training materials and capabilities. Investigators found that social media posts, online forums and dark-web marketplaces contained everything from military equipment manuals, detailed training materials, and photos of facility and aircraft interiors. When combined, these digital footprints can reveal information about equipment modifications, strategic partnerships or potential vulnerabilities, which can be used to clone products, exploit weaknesses or undermine military operations. 

And while DoD has identified the public accessibility of digital data as a “real and growing threat,” GAO found that DoD’s policies and guidance are narrowly focused on social media and email use rather than the full range of potential risks from aggregated digital footprints. 

For instance, the DoD chief information officer has prohibited the use of personal email or messaging apps for official business involving controlled unclassified information. But that policy doesn’t address the use of personal accounts on personal devices for unofficial tasks involving unclassified information — such as booking travel, accessing military travel orders, or posting on social media — activities that can pose similar risks once aggregated.

In addition, DoD officials acknowledged that current policies and guidance do not fully address the range of risks created by publicly accessible digital information about DoD and its personnel. They said part of the challenge is that the department has limited authority to regulate actions of DoD personnel and contractors outside of an operational environment.

“In general, except for the operation security folks, the answer was they didn’t really consider this kind of publicly available information in their own sphere. It’s not like they didn’t recognize there’s an issue, but it was more like, ‘Oh yeah, that’s a problem. But I think it’s handled in these other areas.’ Almost like passing the buck. They didn’t understand, necessarily, where it was handled. And the answer was, it should probably be handled collectively amidst this entire structure,” Kirschbaum said. 

The officials also said that while they had planned to review current policies and guidance, they “had not collaborated to address digital profile risks because they did not believe the digital profile threat and its associated risks aligned with the Secretary of Defense’s priorities,” including reviving warrior ethos, restoring trust in the military and reestablishing deterrence by defending the homeland. 

“One of our perspectives on this is we know we’re not sure where you would put this topic in terms of those priorities. I mean, this is a pretty clear case where it’s a threat to the stability and efficacy of our military forces. That kind of underlines all priorities — you can’t necessarily defend the homeland with forces that have maybe potential operational security weaknesses. So it would seem to kind of undergird all of those priorities,” Kirschbaum said. 

“We also respect the fact that as the department’s making tough choices, whether it’s concentrations of policy, financial and things of that nature, they do have to figure out the most immediate ways to apply dollars. For example, we’re asking the department to look across all those security disciplines and more thoroughly incorporate these threats in that existing process. The extent they’re going to have to make investments in those, they do have to figure out what needs to be done first and where this fits in,” he added.

GAO issued 12 recommendations to individual components and agency heads, but at its core, Kirschbaum said, is the need for the department to incorporate the threat of publicly available information into its existing structure. 

“In order to do that, we’re asking them to use those existing structures that they do have, like the security enterprise executive committee, as their collaborative mechanism. We want that body to really assess where the department is. And sometimes they’re better able to identify exactly what they need to do, rather than us telling them. We want them to identify what they need to do and conduct those efforts,” he said.

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House and Senate negotiators are racing to finalize the 2026 defense policy bill by the end of the week, with all House and Senate Armed Services Committee disputes resolved and only a few Senate jurisdictional details still holding the legislation’s advancement to the House floor in early December.

“I think what they’re doing is, there’s been a couple of pencils-down time frames, but it sounds like it’ll be done by the end of the week. That’s what the focus is. Get it done by the end of the week, and then to be on the floor the beginning of the second week of December,” Rep. Rob Wittman, R-Va., a member of the House Armed Services Committee, told Federal News Network Tuesday. 

The one big place where things are still going through the process, Wittman said, is with the other committees of jurisdiction. They can either decide to waive jurisdiction or refine the language in ways that ensure the “Big Four” on HASC and SASC will agree to include it in the National Defense Authorization Act (NDAA).

“It really is a Senate issue because the Senate has the rules where they can add some things that are not allowed under House rules. That’s really where the issue is right now, I think all the HASC and SASC issues have been taken care of,” Wittman said. 

The Senate advanced its NDAA with broad bipartisan support in October, while the House version passed in September with mostly GOP support.

The two chambers were divided on topline funding — the Senate bill authorized nearly $925 billion for national defense, while the House version aligned with the White House’s $883 billion request. 

Both bills are heavily focused on acquisition reforms, and while the two chambers target many of the same areas, they differ in approach and specific reforms. 

“The House’s version really focused on achieving mission outcomes. It’s much more outcome-based. The Senate version was more about governance. How do we change the issues there of governance? Some of the things that we saw there that I think are really transformational is time frames,” Wittman said during the Defense One State of Defense Business Acquisition event on Tuesday. “The average acquisition process in the Pentagon is 800 days. This is going to change it to 90 to 120 days.”

Many of the acquisition reforms Defense Secretary Pete Hegseth recently rolled out as part of what he called a “war on Pentagon bureaucracy” mirror proposals in the House and Senate versions of the defense policy bill.

“Changing how we do modular open systems architecture — those things are going to be key, opening up the aperture even more, making it easier to use other transaction authorities, changing the [program executive officers] to [program acquisition executives], and then taking those billets that are now three-year billets and turning them into six-year billets,” Wittman said. “That’s actually a longer-term perspective for folks in those areas. I think this is the farthest-reaching effort in acquisition reform in the history of DoD. And a lot of what the House and Senate are doing is reflected in some of the things that the Pentagon is doing.” 

Hegseth’s move to replace the current program executive offices with a smaller number of portfolio acquisition executives — giving these new portfolio leaders broader authorities, including the ability to shift funds among programs — is also part of the Senate’s acquisition reform proposals.

When asked whether officers who used to serve three years as PEOs would want to serve six-year tours as PAEs, Wittman wagered they would as long as it doesn’t interfere with the promotion process.

“We’ve been clear that this does not interfere with the promotion process,” he said. “There’s nothing that prevents somebody that goes into a PAE position as a two-star to come out as a three-star, or, for that matter, even a four-star.” 

The change will also allow PAEs to take more risks in a culture that is deeply risk-averse. But it has to start with Congress, Whittman said. 

“We can’t lecture and say, ‘Take risks,’ and then the first time there’s a failure, we call somebody up on Capitol Hill and bang the table and holler and scream and go, ‘How did you do this? How could this happen?’ That behavior will stop in a heartbeat when somebody goes, ‘You know what? I watched them grill this PAE up on Capitol Hill. I’m not going to do that, so I’m not going to take any risks,’” Whittman said.

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Defense Secretary Pete Hegseth’s acquisition system shakeup is being met with cautious optimism from acquisition experts who say the changes could meaningfully reshape how the Pentagon buys capabilities, manages programs and integrates emerging technologies — if the department can avoid repeating the mistakes of the past.

Stan Soloway, president and CEO of Celero Strategies and federal acquisition expert, said by and large the changes make a lot of sense — they could help to break down entrenched silos across the department’s acquisition enterprise and drive greater coordination and integration. They also expand on initiatives the department has tried before. 

“There have been a lot of reform efforts over the years — and this one both incorporates similar themes and/or reflects a natural extension of them — and all faced similar challenges in both implementation and sustainability,” Soloway told Federal News Network.

But the success of Hegseth’s reforms will hinge on whether the department can change its culture and equip the workforce with the skills needed to operate differently. Otherwise, the system can quickly revert to its old ways.

“Change is not something that happens by dictate. As they and scores of case studies have shown, there has to also be an aggressive, intentional, and holistic approach to change management, prominently including how the relevant workforces are developed. Absent re-aligning those processes, real change will remain elusive,” Soloway said.

Hegseth’s new proposed structure, Soloway said, somewhat resembles the Integrated Product Teams the department created in the 1990s as part of a major acquisition reform push. There were early successes, but they eventually faded, mainly because the workforce and culture never fully adapted.

And whether the department has the workforce to support such a sweeping overhaul remains an open question. DoD has already lost 5% to 8% of its civilian workforce since the start of the Trump administration through various means such as the Deferred Resignation Program and the Voluntary Early Retirement Authority.

“I’m excited about what [Hegseth’s] speech will do to attract the interest of high talent — folks who might want to come in and help us do this job. We’re certainly always looking for good people to come in and help. We do have some need for additional personnel, at least in my office, and I suspect across the acquisition workforce,” Undersecretary of Defense for Acquisition and Sustainment Michael Duffey told reporters Monday.

In addition, while the new structures and consolidations seem promising, there is always a familiar risk that the reforms could end up adding new layers of bureaucracy rather than eliminating old ones.

“It will take particularly strong, forward leaning leadership on both the civilian and military side as well as new levels of collaboration between and among the services and, importantly, [the office of the secretary of defense],” Soloway said.

And then the reforms Hegseth is proposing will require significant funding — but there is very little mention of resources in the strategy the department recently unveiled.

“That’s one place where the rubber hits the road,” Soloway said.

“The next big thing will be the 2027 budget submission, because some of these things require prioritization, and prioritization requires resourcing. Some of the initiatives like a focus on exportability, focus on developing multi-sourcing for parts and components — these things require resourcing. Where are they going to be in the 2027 budget submission? Because that will show how important it is for the administration,” Jerry McGinn, the director of the Center for Strategic and International Studies’ Center for the Industrial Base, told Federal News Network.

‘Speed to delivery’

Hegseth emphasized that speed will be at the center of this sweeping transformation the department is embarking on. 

“The core principles of this transformation are simple: instill the warrior ethos in the acquisition workforce and enterprise, inject a sense of urgency and relentless focus on speed by empowering those directly responsible for delivery to make and own decisions, cut through unnecessary layers to focus the [Warfighting Acquisition System] on speed, accountability and mission outcomes, and prioritize flexible requirements and resource trades to enable timely delivery at the speed of relevance,” he wrote in a memo.

The focus on speed, Solloway said, may be more critical now than ever. But speed alone isn’t the point – the department has spent the past decade chasing speed through tools like other transaction agreements  and rapid prototyping, but the real measure is whether capabilities are actually fielded.

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Interview transcript: 

Terry Gerton You, I’m sure, paid very close attention to Secretary Hegseth’s speech last Friday on the arsenals of democracy. What was your takeaway?

Stephanie Kostro Thanks so much for asking, Terry. And not only was I listening with bated breath, I was actually in the room. And for any Hamilton fans out there, it was the room where it happened. There were roughly 250 folks in an auditorium on Fort McNair when Secretary of War Hegseth rolled out his ideas for transforming acquisition. And there was a lot to be said, Terry, he spoke for well over an hour, nonstop, no questions, just kept going. I would say it’s fair to characterize the audience as a rapt. We were waiting for everything he had to say. There were three main topics he wanted to talk about. One was reforming or transforming the requirements process. The second was transforming the acquisition process. And the third was reforming foreign sales processes, and that’s including both foreign military sales and direct commercial sales. So all of that were key topics for everyone in that room.

Terry Gerton Well, let’s take those one by one and the requirements topic, of course, came up first. He talked about the end of the JCIDS and a realignment of the JROC. What did you take away?

Stephanie Kostro So the requirements process has long been an issue of great concern to industry, as well as from my time as a congressional committee staffer on House Armed Services Committee, talking about by the time you go through the several years to validate a requirement, it may actually be obsolete by the end time you roll out of that process. And so the idea of transforming the requirements process has been long anticipated. And I really appreciate what the secretary said regarding being flexible. Going for combining the requirements process with the acquisitions process so that it’s modular, that it does leverage available commercial technologies and products, that it really looks forward to getting a faster delivery times and getting weapons both developed and then deployed and in the hands of the warfighters who need them. So that was very much appreciated. No one, I think, will cry over the demise of JCIDS, but the question becomes, what rises to replace it. And, of course, the under secretary of war for acquisition and sustainment owes guidance on this issue to be released 45 days from the date of that directive, and then the military services have to come up with plans of action within 60 days. So the next two months are going to be very, very busy.

Terry Gerton All right. Part two was a reform of the acquisition process itself. The headline here is the elimination of PEOs and the replacement of them with program acquisition executives, right?

Stephanie Kostro PAEs, that is correct. So I think the other piece of this that goes hand in hand with requirements transformation is the reform and the transformation of the war fighting acquisition system, as they call it now, not the defense acquisition system. And it really focuses on the war-fighting piece of it. I think what I took away, and he said this a few times, Secretary Hegseth, and I’m going to quote him here, they want to increase acquisition risk in order to reduce operational risk. And for me that means putting flexibility in the hands of contracting officers and those in the programs to pursue modular, multi-source solutions throughout the development of a requirement, or rather the development, of a capability. And then actually to get it into the hands of the warfighter. They want to reward and incentivize speed and performance over bureaucratic processes. And that is music to a lot of industry’s ears.

Terry Gerton So a big part of that speed increases buying commercial first. Secretary Hegseth said they are willing to settle for 85% functionality and work toward 100%.

Stephanie Kostro So that was, I think, an interesting turn of phrase for him, mostly because he did say a few times to increase acquisition risk to reduce operational risk. And of course, you’re going to have to have a balance there of what is that 85% and what 15% are you going to be missing? And so I think as they move forward with embracing modularity, fostering competition and pursuing multi-source procurement, that you do want to move fast to contract. He also did mention not over-relying on the testing element. And so we’ve seen that in previous memos, particularly back in May, where Secretary Hegseth signed some memos about operational test and evaluation and streamlining that process in those offices. And so what I also found interesting is talking about putting contracting officers within the program offices too, so they can sit alongside the requirements developers and the folks who are responsible for fielding the capability, so they get a better sense of what the requirements are and how to incorporate those into contracts, leveraging commercial technologies as much as they are available.

Terry Gerton I’m speaking with Stephanie Kostro. She’s the president of the Professional Services Council. Stephanie, let’s touch on topic number three quickly, the foreign military sales reform.

Stephanie Kostro Part of this reform, or they keep saying transformation, not reformation, so I’ll key into that, transforming what military sales looks like. We’ve had lots of conversations, and I was at the Pentagon, in particularly the European office, talking with our allies and partners about how they could access U.S. solutions, and it always was a multi-year process to go from all of that pre-work where we talk about requirements to a letter of offer and acceptance at the end of it, and actually delivering the materials. It’s multi-year and it is so frustrating, particularly when companies want to compete with non-U.S. companies who don’t have the layers of bureaucracy. And so I look at the reorganization that the secretary laid out, that is to move the Defense Security Corporation Agency and the Defense Technology Security Administration, so I’ll say DSCA and DITSA, which is how we call them, over to the acquisition undersecretary. I think those are smart moves if in fact you want to speed up the fielding of compatible and interoperable equipment with our friends and allies. That said, I think it’s important to note that we need to incentivize folks in order to speed those situations up. And one thing that works really well, and it’s something that PSC has talked about in the past, is if you’re going to have an assistant secretary in a military service responsible for acquisition, and each of the military services has that individual, you need to put into their performance metrics foreign sales. They need to be measured on how well they are doing on that front as well. And that is something that I will be talking to the Pentagon folks and our CEO at PSC, Jim Carroll, will be taking to his Pentagon friends as well regarding how to actually incentivize this behavior.

Terry Gerton So this speech on Friday was the tip of the iceberg, much remains to follow in terms of detail, right? What will you be watching for there?

Stephanie Kostro I will be watching for the number of times and the depth of availability of Department of War individuals to speak with industry. This needs to be a collaboration. When you’re talking about speeding up requirements and speeding up contracting and speeding up foreign sales, you really need to talk to the industry that will be responsible for that. One thing that I did take away from the speech on Friday was an openness for profit. And I say that because a lot of times industry gets demonized for making a profit. But what happens is when you have profits, you can actually turn them back into the company and then make investments in future opportunities. And so if companies are allowed to make a profit, then they can have more money to invest in their companies and their technologies and actually move the ball forward faster. And so as we go through this, I will be looking at opportunities not only to comment formally through written comments, whether that’s through the Federal Register or the System of Acquisition Management, or SAM.gov, but also having round tables. We’ve offered to Department of War individuals, we at PSC are happy to schedule and facilitate a round table to have industry speak candidly with their government partners about how to make this happen faster, better and more efficiently.

Terry Gerton So you’d say that the speech was pretty well received by the folks in the room, then.

Stephanie Kostro I would say it was very well received as a rhetorical device. The proof is always in the pudding. The devil is always in the details. I think as we move forward, there will be more enthusiasm. Enthusiasm will grow, but it really depends on what those reports look like, that guidance from the undersecretary in 45 days, the military service plans of actions in 60 days, and how much input it reflects from industry. I think there is generally a recognition across the board, industry, executive branch and Congress, that something needs to change here. And in fact, a lot of what was in the speech reflected things that are under negotiation in the National Defense Authorization Act conference right now. And I think we are all rowing in the same direction. And I hope we stay doing that.

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As Congress hammers out the final version of the fiscal 2026 defense policy bill, Democratic Sen. Elizabeth Warren is putting pressure on a leading industry group to stop opposing bipartisan right-to-repair efforts aimed at giving the Pentagon greater control over fixing its own equipment.

In a letter to the National Defense Industrial Association, the Massachusetts senator called the organization’s opposition to reform proposals in the House and Senate versions of the legislation a “dangerous and misguided attempt to protect an unacceptable status quo of giant contractor profiteering.”

“Your organization’s attacks are based on unproven conjectures and self-serving projections, making clear there is no real basis to oppose the defense right-to-repair effort other than to protect profits of some of the largest defense contractors in the country,” Warren said in the letter.

The reforms aim to help the Defense Department obtain more technical information to allow troops to repair their gear in theater, enhancing readiness, saving taxpayer dollars and strengthening innovation.

“NDIA’s last-ditch efforts to oppose commonsense and bipartisan legislation that is a Trump administration priority appears to be a desperate attempt to cling to a status quo that makes big defense contractors billions of dollars a year at taxpayer expense. Instead of fighting reform efforts, NDIA should commit to working with DoD to protect service members and promote a healthy and competitive industrial base,” she added.

The military services have long faced contract-imposed restrictions on how they can repair and maintain equipment and weapons, leaving them dependent on original manufacturers to conduct necessary fixes in the field, which is costly and time-consuming. 

Army Secretary Dan Driscoll, for example, recently pointed to a Black Hawk helicopter part to show how contractor restrictions drive up costs. The original equipment manufacturer refuses to repair or replace a small screen-control knob that grounds the aircraft when it breaks — forcing the Army to purchase an entire new screen assembly for $47,000. Driscoll said the Army could make the knob for just $15.

The right-to-repair issue has been gaining momentum and bipartisan support from Congress — and both the House and Senate included provisions in their versions of the 2026 defense policy bills. 

The House version of the bill includes a Data-as-a-Service Solutions for Weapon System Contracts provision, which would require DoD to negotiate access to the technical data and necessary software before signing a contract. That includes detailed manufacturing or process data, digital networks and models, software-related information, and operational and training information — all to be accessible as a service through various methods like online, in person or via machine-to-machine encryption.

Meanwhile, Senate lawmakers included a provision in their version of the annual bill that would require contractors to provide detailed instructions for repair and maintenance. 

“The Defense Secretary may not enter into a contract or agreement for the procurement, sustainment, or subsequent modifications of covered defense equipment unless the contract or agreement requires that the contractor deliver, or offer as a negotiated price option, Instructions for Continued Operational Readiness to the secretary upon delivery of the equipment,” the provision states.

The contractor would have to provide the department with the rights to diagnose, maintain and repair the equipment — and the department could withhold payment to the contractor until the company delivers those instructions. 

NDIA argues that the “instructions for continued operational readiness” that Congress wants DoD to have include “data, tools and software for operations, maintenance, installation and training, which could include sensitive and proprietary technical and manufacturing data and IP developed at the contractor’s private expense.” The group warns the proposal would allow DoD to provide those parts, tools and information to any authorized third-party contractor, including a company’s direct competitors under this proposal. 

In its white paper, NDIA said these efforts will “hamper innovation and DoD’s access to cutting-edge technologies by deterring companies, including traditional contractors, nontraditionals, and small businesses, from contracting with the DoD over concerns of forcing disclosure of IP; increasing legal, safety, and compliance risks; and introducing contractual and licensing conflicts.”

Some stakeholders, however, remain unconvinced.

“I’ve talked to folks that crafted the Senate language, and they don’t agree with that characterization at all. We’re almost dealing with perceptions here. I don’t see any real separation between the objectives in the House or in the Senate versions, but it’s in the particulars on how they do it,” Jerry McGinn,  the director of the CSIS’ Center for the Industrial Base, told Federal News Network.

In her letter to the industry group, Warren accused NDIA of “attacking these reforms with vague and threatening claims that don’t stand up to scrutiny,” including assertions that right-to-repair efforts would “hamper innovation.”

“The opposite is true. Small businesses have said that a defense right to repair law would create new business opportunities in the defense industrial base, not deter them from doing business with the military…Embracing competition will only grow the industrial base further,” Warren said.

“Your argument that such a right would deter companies from working with DoD is not supported by reality and appears to be a late-in-the game effort meant to confuse and scare members of Congress and muddy the terms of the debate,” she added.

In April, Defense Secretary Pete Hegseth directed the Army to incorporate right-to-repair provisions in all new and existing contracts as part of the service’s sweeping transformation initiative. 

Stan Soloway, president and CEO of Celero Strategies and federal acquisition expert, said the debate is just the latest iteration of the government’s decades-long tug of war with industry over intellectual property and data rights. Ultimately, those issues need to be resolved early in a program’s life cycle and not moments of crisis.

“It is true that there have been very difficult negotiations between the parties when the government has sought data it believes it needed. Historically, the government has too often treated IP and tech data as a zero-sum game, demanding access far more broadly than needed. Meanwhile, industry has sometimes been overly zealous in protection of its IP and tech data rights. The lack of trust is real and endemic,” Soloway told Federal News Network.

NDIA declined to comment and referred questions on the matter to their aforementioned white paper.

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While delivering capabilities at speed is at the core of the Defense Department’s acquisition system shakeup, the department’s top acquisition official said the Pentagon is not “mandating speed.”

“We’re continually going to be dependent on the judgment of program leaders who are executing these programs to understand where does the need for speed balance with the risk that we would undertake to cost and/or performance of the system,” Michael Duffey, undersecretary of defense for acquisition and sustainment, told reporters Monday. 

Last week, Defense Secretary Pete Hegseth announced a series of initiatives to overhaul the department’s acquisition process as part of what he described as a broader war on Pentagon bureaucracy. Key changes include prioritizing a commercial-first approach, cutting red tape, increasing competition and bringing more commercial firms and nontraditional contractors into the defense space and transitioning program executive offices (PAO) to portfolio acquisition executives (PAE), which would give these new portfolio officials greater authorities and responsibilities for requirements, resourcing and acquisition.

Most of the changes Hegseth unveiled last Friday are similar to measures currently making their way through Congress.

In the Nov. 7 memo, Hegseth emphasized that speed will be at the center of this sweeping transformation the department is embarking on.

“The core principles of this transformation are simple: instill the warrior ethos in the acquisition workforce and enterprise, inject a sense of urgency and relentless focus on speed by empowering those directly responsible for delivery to make and own decisions, cut through unnecessary layers to focus the [Warfighting Acquisition System] on speed, accountability and mission outcomes, and prioritize flexible requirements and resource trades to enable timely delivery at the speed of relevance,” he wrote in the memo. 

Duffey said while speed to capability delivery is key, given constant budgetary irregularities, his focus is on making the most of the department’s budget — optimizing the system to deliver the best capability at the greatest speed for the lowest cost.

“Those are the parameters we operate in, and that’s what we intend to empower the workforce to make the best judgments going forward,” Duffey said.

Portfolio acquisition executives, Duffey said, will be the ones responsible for striking the right balance between speed and risk, deciding when to accelerate and possibly cut corners to achieve speed or when to delay program delivery.

“We’re hoping to provide the flexibility to the portfolio acquisition executives to be able to move money around and to trade requirements. There’s certainly no question about the emphasis on speed but recognizing that there’s a need for judgment and flexibility in that triangle of cost schedule performance,” he said.

“One thing we’re doing around here nowadays is we’re now saying schedule performance cost instead of cost schedule performance just as a way of emphasizing the fact that speed is priority amongst us,” he added.

It’s unclear whether these portfolio acquisition executives will be the ones making that call — Duffey said the department is still working out those implementation details. “I think what you’ll find is there will be circumstances where they need to have a broader conversation, and there will be circumstances where the threshold will allow them to make that decision on their own,” he said.

Along with Hegseth’s “Transforming the Defense Acquisition System into the Warfighting Acquisition System to Accelerate Fielding of Urgently Needed Capabilities to Our Warriors” memo, the department also released the acquisition transformation strategy — five pillars laid out in the plan include expanding the industrial base; empowering the acquisition workforce to deliver at speed; introducing greater acquisition flexibility through cutting regulations and processes; developing high performance systems; and improving lifecycle risk management. 

Hegseth’s memo already directed the services to begin carrying out a number of key initiatives that emerged from those five pillars.

One of the changes the department seeks to implement is replacing what it calls “redundant and excessive” studies like the Analysis of Alternatives (AoA) that the strategy says delays the start of programs. The process, which takes place early in the acquisition process and is mandated by Congress, is designed to compare operational effectiveness, suitability and life-cycle cost of alternatives. 

The strategy calls for modifying those processes and providing “more rapid and impactful assessment of commercial solutions, existing technologies, and competing prototypes as a preferred approach to the extended document analysis.”

“I think that we can learn more from experimentation and prototyping than we can from an analysis of alternatives. We recognize there may be exceptional circumstances, specifically when it comes to large-scale weapon systems where we may need to do a study of what an alternative might be. But our intent is a heavy focus on prototyping and experimentation as the best learning and best connected to the art of cutting-edge technology,” Duffey said.

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The Pentagon is restructuring the chain of command within its acquisition system, replacing the program executive offices that have long formed the backbone of the Defense Department procurement system with “portfolio acquisition executives” that will be more empowered to make decisions and more directly accountable for performance, Defense Secretary Pete Hegseth said Friday.

The changes are part of a wide-ranging overhaul Hegseth said the department will make as part of what he framed as a war on Pentagon bureaucracy amid a need to accelerate the procurement system, increase competition, use commercial technology as DoD’s default option, and eliminate excessive regulations.

“Speed to delivery is now our organizing principle,” Hegseth said Friday during a 70-minute speech at the National War College in Washington. “It is the decisive factor in maintaining deterrence and warfighting advantage. If our warfighters die or our country loses because we took too long to get them what we needed, we have failed. It is that simple. The sense of urgency has slipped too much, and when you look at what we face, we have to recapture it.”

Commonality with existing proposals

Much of what Hegseth unveiled Friday mirrors reform proposals that are making their way through Congress or that have been suggested by independent reform panels. The rollout also follows a pair of executive orders President Donald Trump issued in April, directing a reshaping of federal acquisition processes.

The move to a more portfolio-centric approach to acquisition, for example, is a feature of both the House’s SPEED Act and the Senate’s FoRGED Act, and the Senate bill also uses the “portfolio acquisition executive” moniker for a reimagined PEO role.

Hegseth offered few details on what DoD’s own conception of the new role would be, but said further guidance would be published within the next 180 days. One key theme, he said, would be empowering the new portfolio officials to make decisions without waiting for bureaucratic approval processes.

“We will break down monolithic systems and build a future where our technology adapts to the threat in real near time. Contracting officers will be embedded within program teams and accountable to program leaders, shoulder to shoulder with our engineers, operators and warfighters who can provide critical, real-world user feedback to the engineers,” he said. “If the mission is not successful, there will be real consequences. We will ensure accountability by extending PAEs’ tenure to be longer than the current PEO service times. We will leverage taxpayer dollars in a more accountable, flexible and deliberate manner to maximize their value across capability portfolios. We will shift funding within portfolios’ authorized boundaries swiftly and decisively to maximize mission outcomes. If one program is faltering, funding will be shifted within the portfolio to accelerate or scale a higher priority. If a new or more promising technology emerges, we will seize the opportunity and not be held back by artificial constraints and funding boundaries that take months or even years to overcome.”

Wartime Production Unit

Meanwhile, Hegseth said DoD is standing up a new organization called the “Wartime Production Unit.” It will be a successor to the existing Joint Production Acceleration Cell, but will be led by a “deal team” that the secretary said would be empowered to make its own agreements with vendors who conduct work across multiple portfolios.

“The deal team will reinforce our contracting workforce, enabling them to work with newly empowered PAEs to negotiate with vendors based on a broader perspective of the vendor’s total book of business within the department, rather than through the lens of a single program, creating leverage and incentives not previously applied,” he said. “This deal team will craft financial incentives that drive contractor performance, demanding on-time delivery of the weapons our warfighters desperately need. It’s about faster negotiations, better results and a commitment to complete transparency and cooperation between the government and our industry partners.”

That approach, Hegseth said, is not just a pilot program — and the department is actively looking to expand the unit and staff it with people who have expertise in the defense business.

“Many talented operators are already on board at the Pentagon, former industry executives who are serving our country to drive success. We call them Business Operators for National Defense, and I encourage those listening who are interested to reach out if you have the skills to contribute to the defense industrial renewal we are embarking on. This may seem like an obvious change, but it’s new for our department to empower world-class operators to help drive necessary change from the Pentagon to industry,” he said. “It’s a fundamental shift in how we arm our warfighters. We are committed to dominating the modern battlefield, and that domination starts with a wartime industrial base focused on execution and operational success.”

Industry’s role

Still to come, Hegseth said, is new guidance that will aim to incentivize contractors to build their own production capacity, let DoD offer clearer demand signals, and create more stable funding streams for multiyear contracts.

As part of that effort, he said, the department would need to ask Congress to alter some existing rules that constrain DoD’s ability to move money between accounts and programs, though he did not specify the exact types of flexibility the department would seek.

“This will build on the great work already done to improve the [planning, programming, budgeting and execution] process and how CAPE and the comptroller interact with Congress,” Hegseth said. “We commit to doing our part, but industry also needs to be willing to invest their own dollars to meet the long-term demand signals provided to them. Industry must use capital expenditures to upgrade facilities, upskill their workforce and expand capacity if they don’t, we are prepared to fully employ and leverage the many authorities provided to the president, which ensure that the department can secure from industry anything and everything that is required to fight and win our nation’s wars.”

And Hegseth warned that companies that aren’t ready to adapt themselves to the department’s vision for a speedier system with more “magazine depth” could soon find themselves with fewer contracts.

“For those who come along with us, this will be a great growth opportunity, and you will benefit,” he said. “To industry not willing to assume risk in order to work with the military, we may have to wish you well in your future endeavors, which would probably be outside the Pentagon. We’re going to make defense contracting competitive again, and those who are too comfortable with the status quo to compete are not going to be welcome.”

DAU is now WAU

But Hegseth said the changes he wants can only happen if DoD achieves a culture change within its own acquisition workforce.

He said he would begin that effort by overhauling the department’s Defense Acquisition University, including by renaming it the Warfighting Acquisition University. He said it would be the “launching pad” for the acquisition workforce and would try to instill in its members a “transformative and warrior mindset.”

“The patriotic men and women in this audience who architect, develop and procure the world’s most lethal and capable technology must be unleashed to deliver the arsenal of freedom faster than we ever have before,” Hegseth said. “The Warfighting Acquisition University will prioritize cohort-based programs combining experimental and project-based learning on real portfolio challenges, industry-government exchanges, and case method instruction that develops critical thinking. And rapid decision making — no more sitting in classrooms learning about failed processes of the past. Our acquisition system is only as good as our workforce.”

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Pentagon leaders came under fire Tuesday for unilaterally overhauling part of the department’s policy office without consulting Congress.

The Senate Armed Services Committee learned about the changes just two days before Tuesday’s confirmation hearing for Austin Dahmer, who was nominated to serve as assistant secretary of defense for strategy, plans and capabilities. 

The panel was unaware that the Pentagon had changed Dahmer’s title from assistant secretary of defense for strategy, plans and forces to “strategy, plans and capabilities.” 

The department said the change was “merely cosmetic” to better reflect the office’s mission, adding that its duties and responsibilities remain the same. But Sen. Jack Reed (D-R.I.), the top Democrat on the committee, said that, based on the limited information the committee has received, that does not appear to be the case. 

Reed said the department quietly realigned portfolios of three deputy assistant secretaries who report to the assistant secretary of defense for strategy, plans and capabilities — the position Dahmer was tapped to fill. For instance, responsibility for AUKUS, a trilateral security partnership between the United States, Australia and the United Kingdom, used to fall under the deputy assistant secretary of defense for force development and emerging capabilities — a new policy office created by merging the Emerging Capabilities Policy Office with the Force Development Office.

Under the reorganization, oversight of AUKUS will shift to another assistant secretary of defense’s office, taking it out of Dahmer’s portfolio.

According to a memo provided to the committee, the changes took effect Oct. 8.

“Reviewing the roles and responsibilities in office is not unusual and sometimes it’s needed. Normally, when the department conducts such a reorganization, it will send to the committee a summary of those changes for our review and consideration before the committee proceeds with the nomination. This is important because the Senate has a constitutional duty to advise and consent on all Senate confirmed nominees as such having a basic understanding of a nominee’s duties is imperative to our oversight role. Unfortunately, that did not happen in this case,” Reed said.

“Rather, we were informed this weekend that these changes had been made, and they were designed to ‘realign certain policy activities and rebrand parts of the organization to better reflect the priorities of the Trump administration,’” he added.

Dahmer told lawmakers that the position’s responsibilities remain largely unchanged. 

“My understanding is that the duties and responsibilities of the position are the same and that it’s a title change,” Dahmer, who has served as deputy assistant secretary for strategy and force development since March, said.

If confirmed, Dahmer would report to Under Secretary of Defense for Policy Elbridge Colby, whom Senators said has been impossible to reach. 

“The hardest guy to get a hold of in the Trump administration is the under secretary of defense for policy. I hope he’s watching. I’m meeting with him tomorrow. Maybe he’ll cancel on me. I don’t know,” Sen. Dan Sullivan (R-Alaska) said. “He came to this committee and said, ‘I’m going to work with the Congress.’ He hasn’t, on big issues.”

Sen. Roger Wicker (R-Miss.), who leads the Senate Armed Services Committee, also criticized the policy office for lack of transparency and information sharing on major issues, including the decision to reduce military presence in Europe and pause some assistance to Ukraine. 

“I’ve noticed an unsettling trend this year. At times the Pentagon officials have pursued policies that are not in accord with President Trump’s orders or seem uncoordinated within the administration,” Wicker said. 

“Members and staff of this committee have struggled to receive information from the policy office and have not been able to consult in a meaningful way with the shop, either on the National Defense Strategy or the Global Posture Review,” he added.

Sen. Tom Cotton (R-Ark.) echoed the sentiment, adding that “it just seems like there’s this pigpen-like mess coming out of the policy shop that you don’t see” from other offices.

Lawmakers’ frustration with the policy shop comes as Defense Secretary Pete Hegseth has barred all DoD personnel from communicating with Congress unless cleared by the department’s office of legislative affairs. CNN reported this week that the department has issued a list of restricted topics that need prior approval, including the National Defense Strategy, acquisition reform, budget and reconciliation spending plans and the electromagnetic spectrum.

Dahmer testified alongside Col. Michael J. Borders, who was tapped to serve as assistant secretary of the Air Force for energy, installations and environment, and Robert Kadlec, who was nominated to be assistant secretary of defense for nuclear deterrence, chemical and biological defense policy and programs.

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