Improperly Subsidizing the Foreign Military Sales Program - A Continuing Problem
Abstract
Over the years, GAO has issued numerous reports on the Department of Defenses continued failure to operate the foreign military sales program at no loss to the Government, as intended by law. This failure has resulted in large subsidies to the sales program, a practice which the Congress wants Defense to avoid. This report discusses another example of Defenses inadequate methods of carrying out its pricing policies. Defense has not charged for the quality assurance services it provides on equipment sold to other countries even though recovery of costs for these services has been required since at least 1970. As a result, during the past 6 fiscal years the Government has absorbed costs estimated up to $370 million that should have been recovered from foreign customers. GAO is recommending that the Congress require the Secretary of Defense to present a plan for overcoming the foreign military sales pricing problems. GAO also recommends that Defense improve pricing policies and practices and insure that the policies are effectively implemented.
Document Details
- Document Type
- Technical Report
- Publication Date
- Mar 22, 1979
- Accession Number
- AD1177867
Entities
People
- Elmer B. Staats
Organizations
- United States Government Accountability Office