Pentagon Instructed to Evaluate Major Acquisition Programs for Possible Cancellation
President Trump signed an executive order on Wednesday, April 9th that could lead to the cancellation of major defense acquisition programs, enhance the procurement of commercial technologies, and alter the workforce. “Our defense acquisition system does not provide the speed and flexibility our Armed Forces need to have advantages in the future. To strengthen our military capabilities, America must deliver state-of-the-art capabilities quickly through an overhaul of this system,” Trump stated in the directive.
The Executive Order (EO) on “Modernizing Defense Acquisition and Spurring Innovation in the Defense Industrial Base,” directs Defense Secretary Pete Hegseth and Pentagon leadership to complete a comprehensive review of all major defense acquisition programs (MDAPs) within 90 days. Any program more than 15% behind schedule, 15% over cost, unable to meet any key performance parameters, or “unaligned” with the SecDef’s mission priorities, might be canceled. “The Secretary of Defense shall submit the potential cancellation list to the Director of the Office of Management and Budget (OMB) for future budget determinations,” Trump wrote.
After that review is completed, the Pentagon chief must provide the director of the Office of Management and Budget with a plan for reviewing all other “major systems” that aren’t categorized as major defense acquisition programs. “It is the policy of the United States Government to accelerate defense procurement and revitalize the defense industrial base. To achieve this, the United States will rapidly reform defense acquisition processes with an emphasis on speed, flexibility, and execution,” per the EO.
The directive also tasks Hegseth to submit a plan within 60 days to reform the Pentagon’s acquisition processes, including a preference for commercial solutions, other transaction authority, application of Rapid Capabilities Office policies, and other pathways to encourage streamlined acquisitions.
“Starting upon issuance of this order, and during the formation of the plan, the Secretary of Defense shall prioritize use of these authorities in all pending Department of Defense contracting actions and require their application, where appropriate and consistent with applicable law, for all Department of Defense contracting actions pursued while the plan directed by this section is under consideration,” Trump stated. Trump also aims to update the “duties and composition” of DOD’s acquisition workforce.
Within 120 days, Hegseth — in coordination with the secretaries of the Army, Navy, and Air Force, and component acquisition executives — must submit a plan to “reform, right-size, and train the acquisition workforce.” The plan should include “restructuring of performance evaluation metrics for acquisition workforce members to demonstrate and apply commercial solutions, adaptive acquisition pathways, and iterative requirements based on the end user's perspective,” as well as an analysis of acquisition workforce staff levels required to “develop, deliver, and sustain warfighting capabilities,” per the EO.
On April 10th, Hegseth signed a memorandum regarding “Continuing Elimination of Wasteful Spending at the DoD”, which cut $5.1 billion in wasteful Defense Department contracts “for ancillary things like consulting and other nonessential services.” The memo details several budget reductions, including $1.8 billion in consulting contracts awarded by the Defense Health Agency to private sector firms, a $1.4 billion enterprise cloud IT services contract awarded to a software reseller, and a $500 million Navy contract for business process consulting. "We need this money to spend on better health care for our warfighters and their families, instead of $500 an hour business process consultant," Hegseth said. "That's a lot of consulting." (Just how are Deloitte, Booz Allen Hamilton, and Accenture fairing under the new administration?)
Hegseth stated that the department is terminating 11 contracts related to diversity, equity and inclusion, climate change, the COVID-19 pandemic response, and other nonessential activities within DOD. "We are committed to rooting out DEI — root and branch,” Hegseth said. He also announced cuts on the academic front, saying that DOD would be pausing over $500 million in funding to a pair of universities that "tolerate antisemitism and support divisive DEI programs." This is in addition to the $70 million already cut in funding at three other colleges in the past weeks. (Which universities caved and which took the funding cut? See more on that here, here, and here. )
The announcement follows Hegseth's initial March 20, 2025 statement that DOD would be cutting $580 million in programs, contracts and grants.