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Lawmaker seeks answers from Navy over proposed cuts to internal audit agency

A U.S. congresswoman and retired Navy surface warfare officer is seeking answers from the Navy regarding plans to slash the budget of the sea service’s main internal oversight entity.

In a Wednesday letter to acting Navy Secretary Thomas Harker, Rep. Elaine Luria, D-Va., expressed concerns about the proposed cuts, which would see the Naval Audit Service’s budget cut by 70 percent over the next two fiscal years, a move that would entail “significant personnel reductions.”

“While I fully appreciate the fiscal realities you face in meeting and executing your highest priority requirements, I am very concerned that these proposed reductions come at a critical time when the Navy must focus on being an efficient steward of taxpayer dollars,” Luria wrote.

Luria’s letter follows a Navy Times report earlier this week that first revealed details of the potential cuts.

Luria’s congressional district encompasses a Naval Audit Service field site in Norfolk, and she wrote that her staff had “received calls from employees expressing fear and anxiety that their positions will be eliminated as early as this fall.”

The cuts would whittle the department from 290 people to 85 over the next two fiscal years as Big Navy searches for more money it can put toward shipbuilding, according to internal documents obtained by Navy Times.

Those cuts were put forth under the Pentagon budget drafted last fall during the Trump administration. President Biden is expected to submit his own budget this spring, and it remains unknown whether the planned Naval Audit reductions will be included in the spending plan he sends to Congress.

Navy and Pentagon officials have declined to comment on the proposed audit service cuts since they are pre-decisional.

Harker’s spokesman did not return a request for comment by Navy Times’ deadline Thursday.

In Wednesday’s letter, Luria wrote that the internal audit agency “plays a significant role in identifying waste, fraud and abuse.”

“I am curious to know how these reductions will impact that critical and necessary oversight mission and how the Navy intends to mitigate those impacts moving forward,” she wrote.

Luria also pushed back on the notion that such oversight work could be accomplished by private contractors.

“It will likely be more expensive for the Navy to contract with private, external auditing firms to cover these auditing missions rather than utilize the experienced and dedicated civil service workforce already in place,” she wrote.

The lawmaker asked Harker to provide a summary outlining proposed personnel reductions and future organizational structure for the audit service, as well as any “previous and/or planned notifications to Congress regarding these decisions.”

Luria also requested the Navy’s plan for its future audit and oversight mission, and any cost/benefit analyses done regarding the contracting out of such functions.

One Naval Audit official who spoke to Navy Times this month on condition of anonymity because they were not authorized to speak on the matter expressed fear about how the office would continue to do its work if such cuts go through.

“Once that oversight is not there, I think that presents a huge problem for the taxpayer, for our Marines and sailors, because we are looking out for the programs that they are using,” the official said. “If we are not able to do that, that check is gone.”

The Naval Audit Service has already absorbed the loss of 70 billets over the past five years, Naval Auditor General Debra Pettitt wrote in a September memo to then-Navy Secretary Kenneth Braithwaite, Chief of Naval Operations Adm. Mike Gilday and Marine Corps Commandant Gen. David Berger.

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“I am deeply troubled that the DON’s only internal audit agency is targeted for such a draconian and misguided reduction,” she wrote.

An internal update sent by Pettitt to her employees earlier this month and later obtained by Navy Times states that the cuts are part of the Navy’s “Stem to Stern” budget review started by then-acting Navy Secretary Thomas Modly last year.

The initiative, announced in February 2020, aims to generate $40 billion in savings across the department from FY22 to FY26.

“Getting after this won’t be easy, but it’s entirely possible,” Modly wrote in a Feb. 18, 2020, memo. “(Stem to Stern) will identify low priority, redundant, or legacy capabilities, programs, processes, or headquarters functions that can be realigned, eliminated or reduced to meet the DON’s resource needs.”

Such a cut to the audit service would leave it able to accomplish only “the most critical work,” and would limit its oversight capabilities, Pettitt wrote.

“It appears that DON senior leadership places a higher value on building the fleet than maintaining (the Naval Audit Service) at its current level,” Pettitt wrote in her employee update this month.

Pettitt declined to comment on the matter when contacted by Navy Times earlier this month.

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