Inspector General Robert P. Storch announced today that the Department of Defense Office of Inspector General (DoD OIG) released the “Audit of Air Force Defective Parts and Contractor Restitution.”
The DoD OIG audit found that the Air Force did not consistently hold contractors accountable in a timely fashion for providing defective spare parts, nor did it obtain restitution from the contractors for those defective parts. Air Force deficiency reporting personnel were unable to provide evidence of contractor restitution for 77 defective parts valued at approximately $500,000, resulting in questioned costs. In another case, the Air Force did not seek restitution for 45 defective C-130J Super Hercules aircraft parts valued at $5.9 million. As a result, the Air Force was unable to recover $3 million for defective parts and paid approximately $200,000 to repair defective parts that the contractor should have repaired under warranty.
“An effective deficiency reporting process provides an important mechanism for the accountability of DoD personnel and contractors, thereby, helps to ensure the proper use of taxpayer dollars,” said IG Storch. “Moreover, DoD’s operational readiness depends on it.”
The DoD OIG made seven recommendations, including that the Commander of the Air Force Materiel Command review stock numbers identified in the audit for which Air Force personnel could not provide evidence of restitution of approximately $500,000 and take appropriate action regarding them. The DoD OIG also recommended providing detailed guidance on obtaining and tracking restitution from contractors that provide defective parts.
The DoD OIG will monitor progress toward the implementation of these recommendations.