The Pentagon has released details of its $639B budget proposal for FY 2018 that begins on 1 October.
- Comprised of $574.5B in baseline spending and $64.6B in Overseas Contingency Ops (OCO) spending, the total is $33B (+5.4%) higher than the final enacted total for FY17.
- Significantly, most of the change in total spending is to come by increasing the baseline by $52B, +9.8%, above the Budget Control Act cap of $522B. This will of course require a change to the law and Democratic support in the Senate. A big lift.
- OCO spending is proposed to decline by $18B (-21.6%) from FY17 but the costs of a proposed 3-5K increase in troops in AFG are not included.
- The Trump proposal is only 3.3% above the Obama forecast for FY18 and half of that increase is used to pay for an increase of 56,400 personnel in the four Services.
- Most major investment programs will see little unplanned change in FY18. In its budget release, the Pentagon has gone to great pains to state that FY19-22 budget projections are “soft” pending the major strategic reviews that are now underway. Results of those reviews will be included in PresBud 19 due to Congress next February.
The following tables summarize the Major Defense Acquisition Programs according to their prime contractors: LMT, BA, GD, RTN, and NOC. (Total request for FY18 Procurement + R,D,T&E in $M. Some final FY17 data not available.)
- Lockheed (LMT). Total requests for LMT’s top 15 programs are down 4% as JSF unit prices come down and volumes for LCS, H60, C130, PAC-3/MSE programs decline as projected. CH53K and SBIRS programs increase production as planned.
- Boeing (BA). Funding requests for BA’s major programs are down 21% from FY17 as P-8 and V22 production lines wind down. The F/A-18E/F program gains five years of unplanned new life with 14 aircraft requested in FY18 and a total of 80 through FY22.
- General Dynamics (GD). GD's programs in FY18 are up 8% from FY17. Shipbuilding and M1 Abrams tank programs increase as the Army's Stryker vehicle program winds down.
- Huntington Ingalls (HII). HII’s major shipbuilding programs grow by 15% as planned. The Navy’s FY18 budget does not yet reflect desired growth from 308 ship goal to 355 ships.
- Raytheon (RTN) . RTN's programs are up 2% as Next Gen Jammer development and Small Diameter Bomb production accelerate.
- Northrop (NOC). Total orders are up 8% based mainly on the accelerating development of the B-21 Bomber. Note that classified ("black") programs are not reflected in these totals.
