STATEMENT BY

THE HONORABLE SARA E. LISTER

ASSISTANT SECRETARY OF THE ARMY
(MANPOWER AND RESERVE AFFAIRS)

The Quadrennial Defense Review was an arduous and taxing process which forced the Army to confront, head-on, a dilemma with which we have been grappling since the end of the Cold War--How do we best adapt to a changing world? How do we maintain our forces' readiness to respond to the full spectrum of crises that arise in the present, while at the same time recapitalizing and modernizing our force in preparation to face even more diverse and asymmetric challenges that will confront us in the 21st Century? In short--How do we balance force structure against strategy? How do we achieve these objectives in a period of fiscal austerity? The magnitude of the issues generated by the QDR, together with the far reaching consequences of this review, challenged our abilities as an institution. And, as is often the case, in retrospect we all perceive ways in which we could have done things differently.

First and foremost, we recognize that all our components, military and civilian, active and reserve, must participate as partners in any and all decisions that affect the Total Army. Further, if the Army is to determine its own destiny in these times of fiscal austerity, each component must put aside parochial concerns, with a view toward building a consensus that will serve the best interests of the whole Army. We have made progress toward achieving that goal. Much work remains to be done, however; consensus must yet be achieved on many critical issues. We must continue our efforts to make each component truly a viable partner in the Total Force.

The QDR was a complex and inclusive process. But by the last days before completion, the train was moving fast, and disconnects occurred within the Army family. There was a disconnect with the Adjutants General when the final drawdown numbers were announced. The Adjutants General were, in short, surprised. It was, indeed, a failure in communications and no ones fault. But it was unfortunate.

At the direction of the Secretary of Defense, key Army leaders came together over the period of June 2 through 4, 1997, at an "off-site", to review the Active Army, Civilian personnel and Reserve Component reductions mandated by the QDR and to develop a plan for implementing those reductions by fiscal year 2002 (FY 02). Represented were the Army staff, the Army Secretariat, the United States Army Reserve, the National Guard Bureau and The Adjutants General. We were a small group, intentionally so. We did not have much time, and we had a big task. The discussions took place in an atmosphere of cooperation and all participants worked hard to reach consensus.

The QDR mandated that the Army draw down its active endstrength from 495,000 to 480,000. The Army will implement the 15,000 Active Component reduction by reducing endstrength 5,000 soldiers in each fiscal year, beginning in 1997, through and including 1999.

The QDR mandated reduction in Civilian personnel of 34,000 will be difficult, given the significant reductions the Army has already executed and planned for the future. The Army intends to drawdown 17.400 additional Civilian personnel by FY06, using a programmed reduction process. The Army expects to realize savings of $1,062 billion by FY06 as the result of this Civilian reduction. In major part, these savings will be generated through restructuring, force structure reductions, and the increased use of outsourcing that we anticipate will result from competitive "A-76 studies", the purpose of which is to ascertain those functions that may be performed more economically through the use of contractor personnel rather than by "in house" civilians. The Army must retain the balance of the 16.300 Civilian spaces (full-time equivalents, or FTEs) identified by the QDR, as well as the associated funding of $995 million, until such time as A-76 studies are completed. This money will be used either to pay contract costs or to pay the salaries of FTE for those functions that remain "in house" -- historically, 50 percent of those functions submitted for A-76 assessment. We hope to maximize government flexibility in implementing all Civilian reductions by requesting simplification of the Reduction in Force rules, while easing the transition for our Civilians by requesting an extension of Voluntary Early Retirement Assistance and Voluntary Separation Incentive Program authorization.

The off-site resulted in agreement among all components, accepted by the Secretary of the Army and the Chief of Staff, Army, and ratified by the Secretary of Defense. The Reserve Component reductions will be completed by fiscal year 2002. The Army Reserve will reduce by 3,000 soldiers in FY 00. The Army National Guard will reduce 5,000 soldiers in FY98 and 99 and 7,000 soldiers in FY00. The specifics of the remaining mandated 25,000 Reserve Component reductions will be determined through a cooperative, inclusive process. This process will rely in part on Total Army Analysis 2007 (TAA 07). The Active Army has committed to work with the Reserve Components, to include The Adjutants General, prior to TAA 07, to change the configuration of Guard units as the Active Army changes-so as, as much as possible, to mirror active units. A major goal will be to restructure and re-mission the Army National Guard Divisions. The Guard divisions will become, through this process, even more relevant to national defense now--and in the 21st Century.

The Army intends to reinvest $850 million on the Army National Guard Division Redesign Process (ADRS) which will accelerate the redesign effort, eliminate much of the Army's current combat support and combat service support shortfalls, and further integrate the Active Component and Army National Guard forces. Modernization of force structure will proceed along a time-line equitable with the modernization of the Active Component. Army National Guard unit conversions (under the ADRS) will increase Army National Guard Major Construction requirements to $50M annually through FY03.

This is only the beginning. At present, we are working on documenting the results of the Army's QDR off-site. Because the issues can become emotional and contentious, we are moving slowly and with great deliberation. We will get there. The Army must resolve these issues to ensure that we continue on our path towards the 21st Century, a path shaped by the Army's work on the QDR--based on the best analysis available and sound professional judgment. The components must maintain a dialogue and work together to ensure the seamless integration of Active Army, Army Reserve and Army National Guard forces in mutually supporting roles. The defense of our Nation demands no less.

The Army has downsized significantly since the end of the Cold War to reflect changes in the strategic environment. Yet while the number of soldiers has decreased, the diversity in type and the sheer number of operations to which the Army has been committed have increased. Army operating tempo and personnel tempo have increased dramatically. Since 1989, the Department of Defense has conducted 27 major contingency operations. Forces from the Total Army have participated in 25 of those operations; in total, 6 of every 10 American service members deployed on any given day were Army soldiers. Operations cover a great range, both in geography and mission focus: compare Operation Just Cause in Panama in 1989, the Summer Olympic Games in Atlanta in 1996, and Operation Joint Endeavor and Joint Guard in Bosnia today. Alone, the Active Army cannot provide all of the forces necessary to accomplish the missions assigned to it and to meet our commitment to our Nation. The Army National Guard and the Army Reserve are vital and important parts of both the Army of today and the Army of tomorrow. Simply put, we cannot operate without them. On the ground, Active Army, Army Reserve and Army National Guard soldiers work and train together to accomplish the many missions assigned by the National Command Authorities. The Army Reserve provides the combat service support capabilities at echelons above division to the Army. At home, the missions in support of the State Governors are primarily conducted by the Army National Guard. Many of you are aware of the benefits that have accrued to your states in the form of assistance provided by the Army National Guard: flood relief, fighting forest fires, and assisting local law enforcement agencies. In years 1991 through 1996, soldiers in Army National Guard units averaged nearly 300,000 soldier-days annually supporting these critical State missions. Strong, viable, and a totally integrated Army Reserve Components are necessary for the Total Army to be responsive and able to execute those missions assigned, worldwide or here at home.

A seamless, integrated Army is a necessity. The leaders of each of our components understand this principle. Contentious issues remain. We are committed to working through those issues: all components must contribute to their resolution. All components are contributing. The world is very different today than it was in 1989, and it will be very much different in 2025. Our plan to implement the QDR directed reductions is indicative of our commitment to innovative change, and will improve the Army's capability to perform its missions supporting the strategy well into the 21st Century.