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Disagreement Over Cost of a Gas Station Demonstrates Need for Pentagon Audit

by Nan Swift / /

Politico reported yesterday that the widely mocked $43 million natural gas station in Afghanistan might have only cost $5-$10 million, far short of the number originally cited by the Special Inspector General for Afghanistan Reconstruction (SIGAR).

The article pointed to communication problems between the Pentagon and SIGAR as one cause for any potential inaccuracy, as well as “imprecise accounting standards.” Ironically, for a person who works with the only federal agency not capable of being audited, the project contractor complained that a proper audit would have come to a more accurate conclusion.

While it’s unclear at this point whether the gas station cost taxpayers closer to $5 million or $43 million, what is clear is better accounting and communication by the Pentagon would provide a more accurate picture of how taxpayer dollars are spent. Regardless of the final price tag for this particular project, this latest episode of wasteful spending makes it all the more urgent that lawmakers insist the Pentagon get its books in order and pass an audit.

Auditing the Pentagon is a major taxpayer priority that would help ensure funds are properly allocated to strategic needs and reduce wasteful spending. As NTU President Pete Sepp wrote on TheHill.com:

The trouble is, how the Pentagon tracks its spending – on its supply chains, procurement, personnel, training, and much more – is related directly to its effectiveness in protecting America. When resources are misallocated, brave service people don’t get what they need, where they need it, when it matters most.

The Government Accountability Office (GAO) has also raised concerns about the Pentagon’s bookkeeping. The 2015 High Risk Report explained:

The Department of Defense (DOD) is responsible for more than half of the federal government’s discretionary spending. Significant financial and related business management systems and control weaknesses have adversely affected DOD’s ability to control costs; ensure basic accountability; anticipate future costs and claims on the budget; measure performance; maintain funds control; prevent and detect fraud, waste, and abuse; address pressing management issues; and prepare auditable financial statements.

Without accurate, timely, and useful financial information, DOD is severely hampered in making sound decisions affecting the department’s operations.

After repeatedly missing deadlines, the Pentagon currently claims that it will be “auditable” by 2017 with the full audit coming later in 2018. It’s important that lawmakers hold the Pentagon accountable to ensure it doesn’t miss any further benchmarks.

Finally, regardless of whether the cost was $43 million or $5 million, the notorious gas station still raises major red flags for taxpayers. Even considering for additional costs that may be incurred from infrastructure construction under less than ideal conditions – and giving the Pentagon the benefit of the doubt –  taxpayers deserve to know why a natural gas station, which usually costs between $675,000 and $1 million could have cost $10 million. And most significantly, as a Sen. McCaskill (D-MO) states in Politico, “Even if the Defense Department asserts that only, say, $5 million was spent on the gas station, the obvious question is: What was the other $38 million spent on?”

That’s a question that taxpayers deserve to have answered. Far from turning a blind eye to poor accounting because it’s our national defense, we should be all the more careful when our security is at stake.