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nance and supply of spare parts, and in the utilization of established commercial firms instead of Army shops and personnel. Comptrollership and economy management

Finally, we have adopted techniques to drive home the importance of good comptrollership and economy management at each echelon of command and to protect the procurement dollar against inefficiencies, neglect, or fraud in contract management. All Army service schools are required to incorporate into their curricula for officers, courses on business management. During the past 5 years, the Army has sent some 500 officers to civilian universities for graduatelevel instruction in business administration, public administration, personnel administration, and allied fields. Since February 1949 we have enrolled 67 officers in the 15-week comptroller staff officers course at the Air University, Maxwell Air Force Base. The Army Finance School at Fort Benjamin Harrison regularly graduates officers from its internal audit course, finance officers' advanced course, and techniques of review and analysis course. The cumulative effect of these educational programs is an ever-growing body of managementconscious military and civilian officials.

The Army has just initiated an improved system for guarding against inefficiency, incompetence, and fraud in our extensive procurement program. We are adding 127 officers to the staff of the Inspector General who, working closely in coordination with the other investigative agencies of the Government, will provide a continuous check on the awarding and administration of Army contracts. We have been provided an effective new tool for this work in the Senator O'Mahoney amendment to the 1952 Appropriation Act permitting the termination of contracts where it is found that gratuities were offered or given by the contractor with a view to receiving favorable treatment.

A second part of the Army's plan is the establishment of inspector general's offices in each of the seven Technical Services to assist them in keeping their own houses in order. All of the other investigative agencies of the Army such as the Army Audit Agency, which by nature of their work come into this field, are being integrated in a single watch-dog system under the Inspector General. The purpose is not to catch misfeasance after the damage is done, but to detect and prevent it at the start. The Army in establishing these tight controls has drawn heavily on the experience of World War II during which we estimate as much as $5 billion was saved through the Inspector General's review of contract awards and administration. Conclusion

All of these measures which I have been discussing are aimed at that conservation, economy, and efficiency which the taxpayers of this country must receive from the services if we are to keep our military muscles hard and our national economy sound. We fully recognize that work of this sort is never finished and that every new measure is simply a step in the right direction. When so many of the costs in a $14.2 billion budget are fixed by the requirements of national defense, there is no other course but to strip the remaining expense of day-to-day operations and housekeeping to the bone. In this vital task, no one has given us more assistance than the committees of Congress, and we welcome your continuing scrutiny and constructive suggestions.

PROCUREMENT AND PRODUCTION

AMOUNT REQUESTED

Mr. BENDETSEN. If we turn to the major programs involved in our total request, first in the field of procurement and production, the appropriation here requested total $3,685,000,000. This is some $6.4 billion less than in fiscal year 1952. We now expect the volume and rate of production will become satisfactory sometime this spring, or about a year and a half after the Army's procurement effort went into high gear. That was with the second supplemental appropriation for 1951. This period confirms our previous experience in mo

bilizing industry, and also confirms the importance of achieving a readily expendable production base to save many critical months of time, should war be thrust upon us.

I should like to point out in this connection that on June 30, 1950, our deliveries of hard goods were at the rate of about $17 million a month. That is the first month after Korea; and in December of 1951 they were $427 million a month, which is a twenty-five-fold increase in a period of 18 months.

Despite the fact the Army has increased its size and strength over the last year, and has maintained substantial combat forces in Korea, we are able to reduce our request for maintenance and operations in fiscal 1953 by approximately $1 billion, or nearly 20 percent. In this field the Army has a real opportunity to engage in constructive, forward-looking programs for conservation and economy and efficiency which will stretch the budgeted dollar as far as we can.

ARMY REBUILD PROGRAM

Hadquipment ogram heach fieldmates

On conservation, I should like to point out that one of our major postwar developments has been the world-wide Army rebuild program. This was inaugurated to rehabilitate countless tons of equipment and supplies left scattered about the earth after World War II. This program has borne full fruit with the exigencies of the Korean conflict, and the return of our troops across the seas to Europe.

Our carefully prepared estimates from each technical service of the Army and from each field command show that their activities under this program have actually returned about $912 billion worth of equipment to the supply lines at a cost of less than $1.5 billion. Had we not been able to inaugurate this program, we would have had to buy new equipment and we could not in fact have carried on the Korean campaign without a substantial additional drain on our rearmament program. In short, this rebuild and rehabilitation effort has meant about $7 saved in terms of new equipment for every dollar spent.

I should like to place in the record, if I may, Mr. Chairman, a list of the type and the quantity involved of each item in the rehabilitation program, the cost that would have been involved in each case had we bought it new, and the cost of the repairs in each case.

Chairman O'MAHONEY. That will be made an addition to your testimony, sir, and if you have extra copies for members of the committee, they would be available for the questioning when it comes.

Mr. BENDETSEN. Very well, sir.
(The information referred to follows:)

Army rebuild and reclamation program items by category, close of World War II

through October 1951
(Costs reported in thousands of dollars)

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11, 690 60, 261

2,358 4,721

Army rebuild and reclamation program items by category, close of World War II

through October 1951Continued

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