Navy gearing up for more DOGE-related cuts
The Navy’s top civilian leader said he’s looking forward to further cuts to IT contracts and other programs identified by the Trump administration’s Department of Government Efficiency as fit for the chopping block.
Speaking Monday at the AI+Expo hosted by the Special Competitive Studies Project, Navy Secretary John Phelan told attendees that his organization has welcomed the DOGE team at the Pentagon.
“We’ve embraced the DOGE agency to come in basically to help us figure out processes and things that we’re doing that don’t make sense, figuring out contracting things that we’re doing that don’t make sense, figuring out IT systems that are built on legacy platforms that end up not talking to one another, figuring out systems that we just do because someone in the room has decided let’s not change it. So, you know, they’ve been very effective with us,” Phelan said.
In one fell swoop in April, the SECNAV ordered the termination of hundreds of millions of dollars in IT contracts — include those for the Naval Maintenance, Repair and Overhaul (NMRO) program — and unrelated grants as part of a broader push at the Defense Department to slash spending that the Trump administration deems wasteful.
He estimated that the Navy has saved almost a $1 billion from chopping expenditures singled out by DOGE, so far, which have included moves like canceling “redundant” IT contracts.
Savings could be reinvested in other priorities, such as improving the living conditions of troops, he suggested.
“You can fix a lot of barracks” with that money, Phelan said.
Defense Secretary Pete Hegseth moved last week to further rein in the Pentagon’s IT spending, issuing a memo aimed at limiting the Defense Department’s hiring of consultants.
Prior to execution of a new IT consulting or management services contract or task order with an integrator or consultant, DOD components must obtain approval from Deputy Secretary of Defense Stephen Feinberg or his designee. Approvals or denials will be based on submission of a cost-benefit analysis, evidence of evaluation of alternatives, and justification that the efforts to be covered by the contract cannot be in-sourced anywhere within the department or acquired from a direct service provider, according to Hegseth’s edict.
Hegseth issued another directive last week giving DOGE personnel even more oversight of DOD contracting efforts going forward, allowing them the opportunity to provide input on almost all unclassified contracts.
At Monday’s conference, Phelan noted that Hegseth has talked about the need to cancel consulting contracts.
“We had a number of … consulting contracts that did not really make a tremendous amount of sense,” the SECNAV said.
If consultants want to work with the Navy, they need to show that they can save the department money, he added.
“My message to consultants is … it’s not going to be just we pay you, come in and do this. Show me meaningful savings,” Phelan said. “It’s got to be tied to results. And I think that’s one of the things we don’t do a good enough job on is tying things to outcomes and results. In our contracts we don’t do a very good job of it, and across shipbuilding, IT, consulting, everything. So DOGE has been very good to work with. I look forward to the next round and working with them to see what they come up with next and trying to remove a number of things that don’t make sense.”
Phelan’s remarks on Monday about recent and future cuts came as the Navy and Marine Corps are poised to consolidate legacy and standalone IT networks into an enterprise information ecosystem as part of a large-scale modernization campaign that seeks to reduce the cyberattack surface, improve user experience and optimize technology investments.
