Defense Secretary Pete Hegseth today announced a significant move to reduce spending at the Department of Defense (DOD), signing a memo to terminate $5.1 billion in existing contracts deemed non-essential or wasteful.
“This is another update on cutting wasteful spending here at DOD, and this one is, as they say, a big one,” Hegseth stated during the announcement. “We’re signing a memo right now, directing the termination of 5.1 billion – that’s with a B – billion in DOD contracts for ancillary things like Consulting and other non-essential Services.”
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The specific cuts highlighted by the Secretary include:
- $1.8 Billion: Saved by eliminating Defense Health Agency (DHA) consulting contracts with firms such as Accenture, Deloitte, and Booz Allen Hamilton.
- $1.4 Billion: Saved from terminating a software reseller contract related to enterprise cloud IT services.
- $500 Million: Cut from a Navy contract for business process consulting within administrative offices at the Bureau of Medicine. Hegseth commented, “We need this money to spend on Better Health Care for our Warfighters and their families, instead of 500 an hour business process consultant.”
- $500 Million: Saved by cancelling a DARPA contract for IT help desk services described as “completely duplicative” with services already provided internally.
Hegseth also announced the termination of 11 additional contracts related to Diversity, Equity, and Inclusion (DEI), climate initiatives, and COVID-19 response activities across the department. “We are committed to rooting out the DEI root and branch throughout this department, and we have found 11 more contracts. We’re going to keep looking,” he affirmed.
In a related action aligned with stated presidential priorities, Hegseth noted the DOD is also pausing over $500 million in funding to Northwestern University and Cornell University this week due to concerns over DEI programs at those institutions.
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This follows $70 million in funding pauses previously implemented for Columbia, Penn, Brown, and Princeton universities.
According to Hegseth, these latest cuts bring the total identified wasteful spending eliminated over the past six weeks to nearly $6 billion.
He credited the “DOD-DOGE” partnership for identifying these savings. The goal, he stated, is to redirect these funds “back into war fighting capabilities here at the defense department.”
“We’re excited to make these cuts on behalf of you, the taxpayer, and the warfighters here at the department,” Hegseth concluded.
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