A General Accountability Office (GAO) report applauds DoD’s success in meeting its goals for terminating the National Security Personnel System (NSPS) and transitioning  former NSPS personnel to other pay systems.  The report cited DoD reports showing that it achieved the initial goal of transitioning 75 percent of former National Security Personnel System (NSPS) employees by the end of FY2010 and is expected to meet the mandatory target date of January 1, 2012 to transition the remaining NSPS employees.  The NSPS Transition Office recently reported that 197,547 of 226,000 former NSPS employees (87 percent) have been successfully transitioned to other pay plans as of April 10, 2011.

However, according to the GAO report to the House Armed Services Committee’s (HASC) Readiness Subcommittee, there were inconsistencies in DoD’s estimated costs of the NSPS termination and insufficient documentation to support those costs.  The GAO report stated that unreliable cost data  and inadequate documentation inhibit DoD from providing “clear insight into the cost of the NSPS termination” to Congress and other stakeholders.

GAO raised questions about the termination costs estimates reported by the NSPS transition office and the employing components.   The report identified a number of cases where reporting by category did not match totals and there were categorization inconsistencies between NSPS and employing agency reports.  In responding to the GAO report, the NSPS transition office strongly supported the methodology used to estimate costs, but acknowledged some inconsistencies and said it had moved to make corrections.  Nevertheless, the NSPS office pointed out that it did not have the responsibility for verifying employing offices’ cost data.

The GAO report also charged that DoD did not provide adequate documentation to support the estimate of the compensation costs due to the termination.  GAO emphasized that federal financial standards require all cost accounting procedures to be documented to allow analysts to trace cost information back to supporting documents.  The NSPS transition office acknowledged documentation difficulties and said that the turnover of experienced personnel had contributed to its inability to provide full documentation.

The GAO report commended the NSPS transition office’s efforts to plan and design a new enterprise performance management system, especially its diligence in involving key stakeholders.  However, GAO criticized the planning’s lack of  connecting documented goals and timelines to its funding plan.  GAO agreed with the NSPS office that it may be too early to define final goals, but the report stated that the lack of at least interim goals and a timeline linked to funding hinders DoD’s ability to measure progress. 

To enable DoD to address the concerns addressed in its report, GAO recommended that the NSPS office work with the DoD Comptroller to ensure that NSPS termination costs are well-documented and reliable and develop near-term design and implementation goals and a timeline that allows them to measure progress.