CBO: Pentagon projected budget to exceed spending caps

The Congressional Budget Office issued a report Wednesday that found the Pentagon’s five-year budget plan is projected to exceed the spending caps established under last year’s Budget Control Act (BCA).

The CBO projection also found that the Pentagon’s plans will cost $123 billion more than the Department of Defense estimates over the next five years, an increase of about 5 percent.

While the CBO said that its projections “have historically been higher than the department’s planning estimates,” the report shows the delicate dance the Pentagon must conduct as it cuts $487 billion out of its budget through the next 10 years.

That number could essentially double if the $500 billion in cuts through sequestration take effect.

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The CBO report found that over the next decade, the Pentagon’s current budget plan would exceed the BCA spending caps by $508 billion without the sequestration cuts. Adding those in, the budget — which did not take into account the sequester this year — exceeds the caps by $978 billion.

In Congress, there is resistance to abiding by the BCA’s spending caps for defense. The House-passed budget, as well as the defense authorization and appropriations bills, all set defense spending at more than $3 billion higher than the Pentagon’s 2013 request.

The higher spending level has led the White House to threaten to veto the authorization and appropriations bills, as the extra money is taken from discretionary spending cuts elsewhere.

For the 2013 Pentagon budget, the CBO estimates that it is $14 billion higher than the BCA spending caps, and it would be $66 billion higher should sequestration take effect Jan. 2.

“Accommodating those reductions, in particular, could be difficult for the department to manage because it would have to be done over only nine months,” CBO writes. “Even with that cut, however, DOD’s base budget in 2013 would still be larger than it was in 2006 (in 2013 dollars) and larger than the average base budget during the 1980s.”

The CBO report also projects DOD spending through 2030, and projects the DOD base budget would require $1.2 trillion more in appropriations than if funding were held at the 2012 levels.

CBO says the primary cost growth in the Pentagon budget is operation and support, which is 64 percent of the 2012 base budget. CBO also cites significant increases in military healthcare, compensation and operation and maintenance costs.