Confronted with ‘eye-opening’ costs, SecNav vows to root out waste
Phelan said his service is beginning to review existing acquisition contracts and will “demand accountability of the shipbuilding enterprise.”
Lauren C. Williams | April 9, 2025 03:33 PM ET
NATIONAL HARBOR, Md.—Two weeks into the Navy’s top job, John Phelan is wrestling with eye-popping program costs and “unacceptable” shipbuilding delays.
“Every missed milestone in shipbuilding and maintenance is a risk to our national security. The need to rebuild and modernize our fleet is now more urgent than ever and has become, in my mind, a national emergency,” said Navy Secretary John Phelan during a keynote speech at the Sea-Air-Space conference on Wednesday. “We will set realistic, achievable schedules, and we will commit to them. We will eliminate the waste and inefficiencies that drain resources without delivering results. We will demand accountability of the shipbuilding enterprise because every dollar, every day, and every decision counts.”
Phelan, who ran his own investment firm and has no military experience, stressed his plan to focus on procurements and acquisition reform during his tenure.
“I see numbers on things that are eye-opening to me,” he said, noting that the service is in early-stage contract reviews. “[At] my old firm, we built the finest hotel in Hawaii, top-rated [at] $800,000 a key. And that has some pretty nice marble and some pretty nice things in it,” Phelan said, comparing it to a barracks that cost $2.5 million a key—the cost of building a structure divided by the number of occupants. Last year, the Marine Corps named bringing substandard barracks up to healthy living conditions a top budget priority for fiscal year 2025.
https://www.defenseone.com/policy/2025/04/confronted-eye-opening-costs-secnav-vows-root-out-waste/404428/?oref=d1-featured-river-secondary
