In summary, then, I believe that we do have reasonably adequate management controls and accounting systems. These systems, supported by recent investigation, indicate that our housing maintenance program is being conducted in an efficient manner. Further, our experience shows that a combination of contract and in-house maintenance selectively applied-is the most economical and efficient way of getting the job done.

LIMITATIONS

You will recall that in my presentation on the fiscal aspects of the budget I discussed the problem of trying to operate within the various limitations contained in the 1961 appropriation act. The operation and maintenance appropriation, which finances the operating expenses of our forces worldwide, is experiencing the greatest administrative burden of all. Eight of the limitations impact directly upon this appropriation. In several instances we have "limitations within limitations." For example, within the limitation on departmental administration there are five additional limitations, i.e., travel, congressional liaison activities, vehicle rental, dependent's education, and authorized military personnel. This makes for complicated procedures in administering programs which otherwise would not be required.

I would like to touch briefly upon some of the operations affected by these limitations.

TRAVEL

Of the total travel estimate of $137 million, approximately 9 percent is utilized for supervisory, administrative and inspection travel. The remainder is used directly for what I would categorize as operational (26 percent), training (49 percent) and logistic support (16 percent). Personally, I also attach a high importance to supervisory travel. One trip can often provide on-the-spot solutions to problemssolutions which are immeasurable not only from a dollar savings but from an operational readiness standpoint.

Not long ago we had activation problems at one of our missile bases. A review of the situation was made in conjunction with the base and contractor personnel. Decisions were rendered at the base. To have attempted to accomplish this through correspondence would have been all too time consuming.

There are other problems inherent in limitations which are not readily apparent. During this fiscal year, we have already experienced several price increases, which had the effect of reducing our available travel funds below what the Congress intended us to have. Effective July 1, 1960, the commercial airlines were granted an increase in tariff rates of 22 percent plus $1 per ticket. We anticipate another increase in airline rates before the end of the year. As you are aware, the Civil Aeronautics Board recently authorized the airlines to increase their net operating profit. This will undoubtedly occasion increased tariff rates. Additionally, early in the fiscal year the railroads in the Midwest and South were granted a 5-percent increase in coach fares.

There are numerous cases of unanticipated TDY requirements. Examples are the movement of aircraft out of the Hurricane Donna area; aircrews dispatched in the Laos crisis, establishment of the Joint Strategic Target Planning Staff, and the dispatch of depot mainte

nance teams to various ADC bases to make emergency corrections to the fire control system on the F-106 aircraft.

MOTOR VEHICLE HIRE

Within the total Air Force limitation of $6 million for hire of vehicles, only seven-tenths of 1 percent is for commercial rental of sedans. The majority of our requirement (79 percent) is for rental of buses, primarily in oversea areas, for the transportation of dependent pupils and native employees. In many oversea areas, country-tocountry agreements specify that native employees be transported to and from work as part of the employment contract.

The remainder of our vehicle rental money is used primarily to reimburse the General Services Administration. We have continually reduced our vehicle inventory pursuant to Public Law 766, in areas where GSA vehicles are readily available.

I would, therefore, like to reiterate my previous request for a moratorium on the limitations contained in the fiscal year 1961 appropriations.

CONCLUSION

In summary, Mr. Chairman, I have described for the committee the principal aspects of the fiscal year 1962 budget for operation and maintenance and its relationship to the numerous Air Force programs which it supports. I considered the estimate-as initially derived in consultation with the Department of Defense budget staff-as being entirely sound. This, however, was prior to the general reduction of $91 million applied against that level. Therefore, we have some hard decisions to manage our programs within the amounts contained in this submission. I can assure you that we will take a responsible approach and, notwithstanding unforeseen circumstances which always arise, that we will maintain an adequate level of combat readiness. In my opinion, however, we have long passed the stage whereby we can safely absorb deficits and unforeseen requirements without some risk of degradation in other areas. It is my hope that this committee will consider this factor in arriving at its final conclusion concerning the amount of funds to be appropriated for "Operation and maintenance, Air Force," in fiscal year 1962.

Mr. MAHON. You have made, General, an overall statement covering the total O. & M. request of $4,340 million. I think we should get a little more into detail before we go into a question period.

What is the next statement which you are prepared to submit? General FRIEDMAN. I would suggest, sir, that General Bennett proceed with the depot maintenance program and that would carry you through budget project 431. Then, perhaps, if you want to start questions at that point, this is perfectly all right, or you may want to extend it to cover program 410, the flying-hour program. We are at your service, sir, any way you want to do it.

Mr. MAHON. I suggest, gentlemen, that we proceed without interruption to this more detailed statement of General Bennett. Will you proceed, General?

GENERAL STATEMENT ON DEPOT MAINTENANCE PROGRAM

BRIEF BIOGRAPHICAL SKETCH OF WITNESS

Born Goldsboro, Md., 1910; attended University of Delaware, mechanical engineering, 1928-32. Commissioned second lieutenant in 1932, graduated from pilot training 1934. Assignments include: Commanded fighter units prior to World War II; commanded a Chinese-American composite wing during World War II; Air Proving Ground Command after World War II; Air War College, 1949; commander, 25th Air Division, McChord AFB, Wash., 1952-54; 11th Air Division, Alaska, 1954-57; Deputy for Materiel Headquarters, Air Defense Command, 1957-59; assigned director of Maintenance Engineering, Headquarters, USAF, since July 1959.

Decorations: Distinguished Flying Cross, Legion of Merit with two Oak Leaf Clusters, Air Medal with Oak Leaf Cluster; Chinese Pilot Wings; Special Breast Order of Jun Hui Medal, Precious Tripod Medal (Chinese). Rating: Command pilot.

General BENNETT. Mr. Chairman and members of the committee, today I will present for your consideration budget project 431, depot level maintenance, for fiscal year 1962. This is the level of maintenance performed on aircraft, missiles, and support equipment requiring major overhaul and/or complete rebuild of parts and accessories. In addition to the fiscal 1962 program, I will review for you the status of the fiscal 1961 program. Also, I will tell you how we distribute workload between the organic and contractual resources. Finally, I will discuss the new maintenance data collection and analysis system used throughout the Air Force.

The success or failure of our mission depends to a very great extent on what we have ready to go at the instant the requirement arises. Therefore, gentlemen, the maintenance mission is basic. All equipment located worldwide, and associated with the strike, defense, and support mission must be ready to go 24 hours a day, each day in the year.

The total dollar requirement reflected in this request is $713,891,000. I informed this committee last year that the cost of keeping the aircraft, missiles, and support equipment ready to go could not be expected to decrease in the immediate future. We know, however, that we cannot allow the cost of this job to increase significantly from year to year. We avoid this by meeting only the essential requirements necessary for mission accomplishment.

A large number of aircraft has been deleted from the inventory. The overall total has been reduced by approximately 5,000 over the past 3 years. These were: B-25's, B-26's, C-45's, F-84's, F-86's, F-89's, and F-94's. However, these aircraft are comparatively simple weapon systems. We performed little or no depot work on them during the last few years. We have programed little or no depot maintenance in 1962 for the older type aircraft such as C-47's and C-54's that remain in the inventory, with the exception of a few special mission aircraft. Further, no depot level maintenance has been performed on these types of aircraft in the past 3 or 4 years, with the exception of those just mentioned.

Replacing these aircraft in the inventory, we have the Century series fighters, KC-135's and the B-52's. These weapon systems create a very large, complex and expensive workload. An example of fund application on older aircraft undergoing inventory phaseout is the B-47. In 1961 we spent an average of $15,776 on each B-47 for

depot maintenance of the basic aircraft. In 1962 we have programed only $11,380 for the same requirement. When compared with the acquisition cost this amounts to approximately one-half of 1 percent per year per aircraft for depot level maintenance.

Adding to this, the overhaul cost of engine, accessories, and electronic equipment required to support this weapon system the annual cost rises to approximately 1 percent of the acquisition price.

DEPOT AND CONTRACT MAINTENANCE POLICY

Now I should like to discuss the policy and management of this program. In past years we have described to this committee how we distributed work between depots and contractor facilities. There is the need for an organic capability to manage all elements of this program, starting with the research and development stage of new weapon systems through the inventory life and eventual deletion from the inventory. The actual accomplishment of this workload was split between depots and contractors, based on tactical necessity, capability, and the requirement to retain a technical competence to manage the work regardless of where it was done.

This year the policy governing the distribution of depot and contractor performance of maintenance was given by the Department of Defense in a directive titled, "Policies Governing the Use of Commercial and Military Resources for Maintenance of Military Materiel," dated July 28, 1960. This directive created no problems in the Air Force because of the similarity to the way we have been doing business over the years.

The directive states, "It is the general policy of the Department of Defense to utilize private industry for the accomplishment of maintenance of military materiel to the maximum extent practical, recognizing that maintenance in support of military missions is a vital part of military capability which should not be compromised."

Further amplification is provided within the directive by the statement, "Each military department shall develop and/or retain an inbeing military depot level maintenance capability for only that mission-essential materiel which would require continuing depot level maintenance to sustain operations under emergency or wartime conditions, or which would require such depot maintenance in peacetime to assure operational readiness."

The Air Force depot level maintenance program for fiscal year 1962 is in complete accord with the objectives and policies outlined in the Department of Defense directive.

MANAGEMENT AND PRODUCTION ANALYSIS

Approximately 2 years ago the Air Force initiated a maintenance management system at the base level, utilizing automatic data processing equipment. This program has many effects on the depot level maintenance program.

The information used in this system is a direct input of the base mechanic. This program is fully operational on all Air Force bases. Today it applies to missiles, aircraft, ground support equipment, and is being expanded to the vast ground communications and electronics function. This system provides, from source documents generated by the base mechanic, information of maintenance actions accomplished

on equipment. This information is used to prepare base level reports for management and the same data is sent to the Air Force depots responsible for the equipment. At the depot this data is analyzed to determine system reliability and maintenance trends which affect flight safety, operational ready goals, and other deficiencies affecting our mission capability.

The system has replaced the routine unsatisfactory report system that annually required hundreds of thousands of manually processed deficiency reports. Each of these unsatisfactory reports required approximately 50 man-hours of processing time before corrective action could be started. This step has been eliminated and the man-hours saved have been applied to immediate analysis of equipment failures. The program provides data never before available for analysis in the areas of inspection criteria, maintainability, and reliability of equip

ment.

Using this data, we have already realized these benefits:

(a) More accurate determination of when to change accessories. (b) Increased combat readiness by revision of inspection cycles. (c) Earlier correction of equipment deficiencies.

In the immediate future we will be able to develop increased base level repair capability thereby decreasing the reparable backlog in the depots.

The Army, Navy, and industry have sought information on this system with a view toward adapting the principles to their operation. We are pleased with the progress to date. With refinements to come, we anticipate savings in material and man-hours which will be used to reduce aircraft and missile downtime.

MAGNITUDE OF WORKLOAD

The maintenance mission includes many tasks requiring a wide range of skills and know-how.

Specifically, the job covers not only airplane and missile maintenance, but also inspection and overhaul of ground equipment, repair and calibration of instruments, and repair and alinement of precision navigation and bombing systems.

Further, it includes repair of vehicles, shop and test equipment, and the workload associated with the ground electronics systems pertinent to warning and weapon control. These workloads are not confined to any one geographical area, but are distributed worldwide.

WORK PRIORITIES

During the presentation to this committee last year, I outlined the general priority for the use of the funds requested. The same priority basis is applicable to this request.

First priority consideration will be given the combat and combat support forces. This includes warning and command-control systems. Of lesser priority is the minimum essential maintenance of the equipment used in training, transportation, and general housekeeping of all activities. These requirements were given close scrutiny in the preparation of this estimate.

Finally, little or no work is programed on equipment planned for early deletion from the inventory unless the safety of the crew and equipment is involved.