Nov. 18, 2014 —
We evaluated the C-5 Reliability Enhancement and Re-engining Program to determine the legitimacy of the allegations made in the Department of Defense Office of the Inspector General Hotline complaint.
We substantiated four of the six allegations, as noted below:
A. The Government failed to discourage repeated tender of nonconforming components. – SUBSTANTIATED
B. The Government delegated inherently Government functions to Lockheed Martin. – SUBSTANTIATED
C. The Government failed to approve and document Lockheed Martin flights. – UNDETERMINED
D. The Government accepted nonconformances that were corrected at an additional cost to the Government. – SUBSTANTIATED
E. Defense Contract Management Agency (DCMA) failed to comply with DCMA Instruction for the corrective action process. – SUBSTANTIATED
F. The Government failed to ensure that Lockheed Martin used U.S. Air Force service guidance. – NOT SUBSTANTIATED
We recommend that the System Program Office ensure that the Government disposition process, practice, and contract documentation is in compliance with the Federal Acquisition Regulation and Defense Federal Acquisition Regulation Supplement. The System Program Office should establish a process for, and actively participate in, the review and disposition determination of all critical and major product nonconformances. In addition, the System Program Office should update its airworthiness certification process to ensure that identified risks have been resolved or accepted by the appropriate authority before issuing Military Certificates of Airworthiness.
Furthermore, we recommend that the Defense Contract Management Agency ensure that it reviews all nonconforming material dispositions and approves all minor nonconforming material dispositions before Lockheed Martin takes disposition action by actively participating in a joint Government Contractor Material Review Board. Also, the Defense Contract Management Agency should review all open Corrective Action Requests and raise the level of any that meet the elevation criteria of Defense Contract Management Agency Instruction 1201.
On October 23, 2014, the Program Executive Officer for Mobility and Defense Contract Management Agency responded to our recommendations. Collectively, they concurred with 14 recommendations, partially concurred with 1 recommendation, and did not concur with 3 recommendations. We determined that four of their comments did not meet the intent of our recommendations. We request that the Program Executive Officer, Mobility, and Defense Contract Management Agency provide additional comments in response to this report by December 19, 2014.
This report is a result of Project No. D2013-DT0TAD-0004.000.