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largely as the result of a 6-week economic strike of production workers at Collins' Dallas plant where this equipment was manufactured. This strike began on May 1, 1960, and ended on June 5, 1960. However, the Dallas plant did not return to full production capacity until July 1, 1960, when the final agreement with the union was reached. Comparisons of scheduled and actual deliveries are shown:

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In the case of certain items, delinquencies appear somewhat greater than shown above because of priority assignments as between items. These priorities were established by BuShips in the form of shipping instructions.

3. NObsr_81220.This contract was for a quantity of 580 AN/ URC-32 transceivers. We understand that 28 of the 40 items identified by Congressman Wilson as being delinquent relate to this contract. We are somewhat surprised that this contract should have been selected for comment, as we feel that it is an outstanding example of Collins ability to meet and surpass production schedules for highly complex electronic systems. For example, items 1, 3, 4, 6, 7, 46, 47, 48, 49, 50, 51, 68, 73, 75, 77, and 80 were delivered on or as much as 3 months ahead of schedule. Items 5 and 9 were 1 month late due to delay from BuShips for shipping authority. Items 10, 11, 66, 67, 69, 70, 74, 79, and 81 involved delays of short duration. Item 5 was 90 days late but this delay was made


on item 49 which was an identical article. In summary it may be said that contract production schedules for all major equipment items were met.

We are completely unable to substantiate the report that certain items on this contract were 10 to 14 months delinquent.

We have examined the copy of exhibit 6 which you provided us this week and, although we have not yet examined all of the pertinent contract records, we find it to be a generally correct appraisal of our performance record with respect to timeliness. We will be happy to discuss any of these contracts with the subcommittee and disclose the reason for any apparent delays. We would particularly welcome a comparison of Collins' performance record on these contracts with that of other concerns manufacturing the same equipment or equipment of comparable complexity.

We trust that this information will enable the subcommittee to complete its record in this matter. Very truly yours,

D. H. FOSTER, General Attorney.



Mr. Chairman and members of the subcommittee, I wish to thank the committee for having conducted these hearings on the current procurement of the PRC-41 ultrahigh frequency radio transceiver sets. I also thank the committee for allowing me to make this concluding statement. These hearings afforded the Navy the opportunity to present to you and to the general public the basic facts in this case. We welcomed that opportunity and have presented responsible and knowledgeable witnesses from the Navy and Marine Corps. You have heard not only their testimony but that of management officials of Arvin Industries and of Collins Radio.

In my view, this evidence confirms the judgments we had previously reached in the Navy that our requirement for the PRC-A1 is most urgent and that only the developer of that complex UHF equipment, Collins Radio, can meet the delivery schedule to fill the urgent requirements of the Marine Corps and of the Navy, Army, and the Air Force.

As the Commandant of the Marine Corps, General Shoup stated:

We urgently need the AN/PRC-41 * * *. At this moment, the combat readiness of the Fleet Marine Forces in Thailand, in Okinawa, in the Mediterranean and the Caribbean, and in the United States is impaired for lack of adequate replacement for the M-A-Y. The original schedule for delivery of a replacement radio cannot now be met-and the requirement becomes more urgent with each additional delay.

The Marine Corps has been trying since 1951 to develop a replacement for the M-A-Y transceiver, intending to retire the M-A-Y's beginning in 1954. Unfortunately, three attempts to develop a successful replacement failed and, by 1960, the Marines' situation had become critical necessitating commercial rebuild of M-A-Y sets. Not only has the M-A-Y become obsolete due to its marginal capability for communicating with modern jet aircraft, but there is an everincreasing shortage of serviceable units. Thus, the need of Marine Corps for the PRC-41, the first and only acceptable replacement for the M-A-Y, is an urgent one of long standing.

The Marine Corps witnesses pointed out the complexities of the PRC-41. They analyzed the time (16 months) it would take Collins Radio, the developer of the PRC-41 and of some 34 other military UHF radio equipments, to make delivery of these equipments. They also analyzed the time (26 to 39 months) it would take any other electronics firm competent in the military UHF field to complete deliveries of the same equipments. Moreover, they explained the reasons why we concluded that only Collins can meet the required delivery schedule and that Arvin's proposal to complete deliveries in 12 months cannot be accomplished by it.

This Arvin now seems to recognize also. Arvin's vice-president testified that it would have to amend its proposal both in terms of time and dollars. From his testimony (Tr. 305), it also appears that when Arvin prepared its proposal it did not realize that although a service test model was available, it was not a production model, and similarly that the drawings that were available were not production drawings.

We realize that the Request for Proposal that Arvin received from Congressman Earl Wilson covered the equipment requirements of the developer, Collins Radio, and did not, therefore, specify the four additional preproduction models and the extensive test and evaluation that necessarily would be required of any company other than the developer, Collins Radio. The Request for Proposal and its enclosed performance specifications did in fact require the accomplishment of all of the modifications to the service test model even though they did not specifically spell out the particular modifications that had to be made. Moreover, contrary to Mr. Wilson's contentions, Collins Radio did agree in its proposal to accomplish all such modifications in furnishing the production equipments to the Navy. We realize that any company other than Collins Radio would have difficulty in determining the differences between the performance specifications and the actual performance of the service test model and in identifying all the modifications required thereby without a more detailed "road map” of what these specific modifications were. Collins Radio, on the other hand, had representatives present during much of the test and evaluation of the service test models and, accordingly, knew the exact changes in these models the performance specifications required. These are some of the reasons why Arvin's proposal would have to be amended both in time and price.

We appreciate Arvin's long-range plans to develop a capability in the military ultrahigh frequency radio field and welcome their interest in Navy procurements. Although Arvin did some work in the commercial ultrahigh frequency field over 6 years ago, it is not doing any such work now and it has never produced any military ultrahigh frequency radios. Although Arvin has obviously been put to some expense in preparing its proposal, the record does show that the information which Arvin received concerning this procurement and upon which it acted in preparing its proposal came from Congressman Wilson and not from the Navy.

I agree completely with this committee that all Government procurement policies should be set forth in writing and available to Congress, to industry and to the general public as well. There is no excuse for the failure to publicize the revision in Navy policy that was discussed here last Thursday, June 28. Instructions have been issued designed to assure that this does not occur in the future. Mr. Chairman, I wish to make it clear that I believe in the Navy's

I system of checks and balances and that I have faith both in the integrity and capability of our engineering and technical personnel. As indicated by the testimony, there were many separate control actions before the proposed Determination and findings, authorizing negotiation of a contract for the PRC-41 equipment with Collins Radio, reached my desk. The first control steps were taken in the Marine Corps, where the major requirement for the PRC-41 originated. Within the Bureau of Ships there were additional control steps. The personnel involved in these steps, both officer and civilian, are highly knowledgeable concerning the development of the PRC-41 equipment, familiar with the procurement history of equipment of related design and complexity, and thoroughly qualified to examine into the technical, production and procurement aspects and to determine the validity of the recommendations made. Additionally, there

were other separate control steps in the Office of Naval Material culminating in the recommendation made by the Chief of Naval Material to me. Mr. Chairman, these people are conscientious, dedicated and capable public servants. Their recommendations I value highly. In addition, I personally reviewed the facts before I signed the Determination and Findings and authorized negotiation of a contract with Collins Radio.

Furthermore, when Mr. Wilson submitted the Arvin proposal and made his serious charges to Secretary Korth, we had the entire case reexamined and reevaluated. I personally participated in this review and concluded that the original decision to negotiate only with Collins Radio was sound.

I do not claim we are free from human error, but I do assert that our judgments are always made in good faith in the interest of the United States and, specifically, that in this case the correctness of our decision to award this contract to Collins Radio, the developer of this complex UHF radio set, as the only source which can meet our urgent need, has been proven by your hearings.

Mr. Chairman, the Navy and the Marine Corps agree with the committee that competitive procurement, rather than sole source, should be employed whenever possible. Understandably, however, there will always be situations where sole source procurement must be used to meet military requirements. So long as we are striving, as we must in this cold war, to push ahead with more and more advanced weaponry, these sole source situations will arise. Our aim is to increase competitive procurements to the maximum and to break away from initial sole source situations at the earliest possible time. The concentrated efforts of the entire Department of Defense, from Secretary McNamara down, are to achieve this goal. As Mr. Gilpatric, Deputy Secretary of Defense, put it recently

we must stress full and free competition with equal opportunity to all interested qualified suppliers, and we must continuously seek to minimize sole source procurements for end items, major subsystems, spare parts and supplies.

Mr. Chairman, I am fully conscious of the obligation to conserve the taxpayers' dollars. At the same time, I am equally conscious of my grave responsibility to the sons of those same taxpayers, who are now or in the future may be in the service of our country. Their success in battle and their lives depends on the quality, reliability and superiority of the weapons we give them. Fully aware of all these responsibilities, I feel very strongly that I can fulfill them in this case only by authorizing the award of the PRC-41 equipment to Collins Radio.

I am deeply disturbed that the personal motives of myself and other Navy personnel have been impugned by Mr. Wilson. Secretary Korth, in his letter to Mr. Wilson of May 31, 1962, urged Mr. Wilson to give the Navy the facts on which he based his accusations, and if he were not willing to give the Navy such facts, to give them to the FBI. To date Mr. Wilson has given no information either to the Navy or to the FBI. In fact, he has not replied to Secretary Korth's letter. Because Mr. Wilson has stated that some of his statements can be backed up with documentation by the General Accounting Office, we have checked with GAO to see if they have any evidence of wrongdoing in connection with this procurement. We have been assured by representatives of GAO that they have no evidence of wrongdoing on the

* * *

part of Navy personnel in connection with this procurement and that Mr. Wilson has not furnished them any such information. We have inquired within our own Department for any evidence of wrongdoing in this procurement. We have found none. We know, of course, Mr. Chairman, that despite the fact Mr. Wilson requested you to hold these hearings and, further, sat with you and the members of the committee and heard all the evidence, he chose not to testify. We have read the statement he filed with you on July 3, 1962, and find no evidence in it of wrongdoing on the part of Navy personnel in connection with this procurement. We understand also that your subcommittee, either in or apart from these hearings, has received no evidence from Mr. Wilson of wrongdoing on the part of Navy personnel in this procurement and that your subcommittee has no such evidence of its own. In sum, Congressman Wilson has not submitted any evidence whatsoever of wrongdoing on the part of Navy personnel, and the record in this hearing at its close is completely devoid of any evidence in such regard.

In conclusion, Mr. Chairman, I believe that we have firmly established in this hearing (i) This is an urgent requirement. As the Commandant of the Marine Corps stated :

We urgently need the PRC-41. *** and the requirement becomes more urgent with each additional delay.

And (ii) Only Collins Radio, the developer of this complex UHF equipment, can meet the urgent delivery schedule. Collins, a pioneer in military UHF radio equipment, having successfully developed and built the service test models and being thoroughly familiar with the many modifications that must be made in the production units, can produce many months quicker than any other company.

Mr. Chairman, the best interests of the United States will, in my judgment, be served by a prompt award to Collins Radio for the PRC-41 equipments that are so urgently needed. I know of no reason why the Navy should not now do this.

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