Fed IT Watchers: You need to know sequestration isn’t over yet


dollarquestionSurely you didn’t think sequestration was over did you? But just in case you crossed this off your worry list we are here to remind you, the impacts of current delays are going to be disruptive, and the threat more “can-kicking” still exists and can make things even worse. Full scale sequstration, as articulated in the law, is also possible.

For Department of Defense (DoD) watchers we have seen a memorandum by Deputy Secretary of Defense Ashton Carter (see: Carter Memo on FY13 Budget Uncertainty) which is a must-read for anyone seeking to understand what is happening.

The DoD depends on sustained (uninterrupted) budgets to make sane decisions. Two areas of uncertainty are keeping the planners up at night.

  • First, DoD is still operating under a Continuing Resolution. This means they have to spend only at the 2012 level. Since they expected a modest increase in 2013, this leaves some unpaid bills on the table. If nothing changes, and the Continuing Resolution becomes the FY2013 budget, DoD will run out of money before the year ends.
  • Second, the sequestration plan wasn’t’ killed, just “deferred” until 1 March. That means we get to go through it all again. Are the new leaders in Congress any better equipped to solve this than the old leaders? That’s the $50 Billion Dollar question!

The memorandum signed by Ashton Carter lists some near-term actions that are approved. They include freezing civilian hiring, reducing base operating funding, killing 3rd and 4th quarter planned ship/aviation maintenance, and curtaining conference, training, and administrative expenses (including business IT).

Further on that, each component is to review their upcoming contracts and contract modifications with an eye towards finding some that can be deferred. After you take out the “must protect” group of contracts (personnel, those that incur heavy penalties, wartime operations, etc.) the remaining pool of candidates becomes quite small. And the longer we go into the fiscal year, the less time we have to make it up.

Fortunately, the work we do in the IT arena is critical and the requirements are compelling to keep them funded and maintained. Now, more than ever, companies seeking DoD work must focus narrowly on the new defense strategy (available here: DoD Defense Strategy 2012 ) and tell a compelling story of how they directly support it. IT capabilities are force-multipliers, and those that enhance the defense strategy will always win.

If you provide IT capabilities into the DoD, understand that many decision-makers are focused on sequestration matters right now. They will need dramatically transformative/disruptive IT to help them address their missions and they need you to bring those capabilities to their attention, even if they are busy doing other things. So we recommend you keep seeking to get the right info to these government leaders. Let us know if we can help.

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