U.S. Navy Secretary Carlos Del Toro this week pledged to hold government contractors accountable and called on them to deliver cutting-edge technologies and capabilities to the Navy “on time and on budget without excuses.”

That was his bottom-line message at the WEST 2024 conference on Feb. 15 in San Diego, Calif. – co-sponsored by AFCEA International and the U.S. Naval Institute – to an audience full of industry officials.

“Overall, many of you are making record profits – as evidenced by your quarterly financial statements – and while I’m very happy for you, you can’t be asking the American taxpayer to make even greater public investments while you continue, in some cases, to goose your stock prices through stock buybacks, deferring promised capital investments, and other accounting maneuvers that, to some, seem to prioritize stock prices that drive executive compensation rather than making the needed fundamental investments in the industrial base and your own companies at a time our nation needs us to be at all-ahead flank,” Del Toro said.

“Through initiatives like the Taxpayer Advocacy Project, I have directed our contract community and our Office of General Counsel to ensure that we will leverage all legal means at our disposal to ensure that the American people are also getting what they paid for,” he added.

Del Toro said the Navy will be holding companies accountable for “poor performance and misconduct,” and that he has directed a “deep dive” investigation of poor performers. The secretary did not mention any specific companies.

“We must endeavor to ensure that contracts with the Navy are delivered on time and on budget – the global strategic situation demands it,” he said.

Separately, Del Toro said that naval decisions in shipbuilding, maintenance, repair, and more depend on the service branch operating on a full-year budget.

While Congress has so far avoided a government shutdown, he said that a full-year continuing resolution (CR) to fund the government at fiscal year 2023 spending levels would be “monumentally damaging to our efforts to build and maintain the fleet of today – much less the fleet of the future.”

Current government funding is due to expire in early March – some agencies will run out of funding on March 1, and the remaining agencies on March 8.

“If Congress does not pass a full-year budget, we will face a deficit of over $40 billion in sequestration cuts and misaligned funds,” Del Toro said. “Without our full budget, our safety and readiness will suffer, at a time when we are ill-able to afford it – lost time in readiness cannot be bought back through future funding.”

“The American people expect the Navy and Marine Corps to be ready to respond in defense of our national interests – and we must have the funding to rise to the significant global challenges we face,” he concluded.

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Grace Dille
Grace Dille
Grace Dille is MeriTalk's Assistant Managing Editor covering the intersection of government and technology.
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