By Lara Sayer, Former Executive Director for the Commission on PPBE Reform; Annie Crum, Former Director of Operations for the Commission on PPBE Reform; Elizabeth Bieri, Former Director of Research for the Commission on PPBE Reform; David Zorzi, Partner from Kearney & Company
This article reflects the research, recommendations, and outcomes of the Commission on PPBE Reform. Kearney Partner David Zorzi contributed to several articles and presentations with the PPBE Commission’s Executive Team.
The National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2022 established and directed the Commission on Planning, Programming, Budgeting, and Execution (PPBE) Reform to conduct a comprehensive assessment of all four phases of the PPBE process and recommend improvements with a particular focus on defense modernization. This was the first time such an effort was made to analyze the efficiency and efficacy of the PPBE process since its establishment in early 1961. After two years of extensive research and engagements with subject matter experts and practitioners across the PPBE ecosystem, the Commission published its research and recommendations in Interim (August 15, 2023) and Final (March 6, 2024) Reports available on the Commission website at https://ppbereform.senate.gov/.
The current PPBE process has many strengths, such as involving all stakeholders and identifying key budget issues in balanced short- and long-term views; however, much of it, except for the Execution Phase, is about planning for future cycles and does not respond quickly enough in an agile and effective manner to counter the rapidly evolving security environment and pace of technological change. The Department of Defense (DoD) must have a modern process that enables strategy to drive resource allocation in a more analytically informed way and allow the DoD to quickly pivot and respond to the changing landscape to resource the warfighter at the speed of relevance in all phases of the PPBE process. The United States risks losing more of its diminishing technological edge without immediate transformational change, especially in the year of execution when most of these opportunities arise and must be addressed.
The Commission identified five critical goals for reform and 28 actionable recommendations to transform all aspects of the PPBE process, preserve and strengthen congressional oversight, and maintain transparency for industry and the American public. The most impactful recommendations depend on where an individual sits within the process, but regardless of that role, the collective impact of all 28 recommendations is transformational for Congress and the DoD. Each one is essential for changing how the DoD approaches resourcing decisions to support DoD and national security priorities; improves the speed, agility, and analytical capabilities needed to support those decisions; and ensures that the DoD and Congress have the tools needed to proactively address current and future threats.
On the day the Commission’s Interim Report was released, the Deputy Secretary of Defense directed the Department to adopt the 13 recommendations ready for near-term implementation. The implementation plans were publicly released the day the Final Report was published. The Military Departments and other stakeholders are also actively assessing the recommendations and supporting overall DoD implementation efforts. The DoD working groups were established, and schedules and milestones are in development to implement the Commission’s recommendations to Review and Consolidate Budget Line Items (BLI) (#10), Review and Update PPBE-Related Guidance Documents (#12), Restructure the Justification Books (#18), and Improve Training for Personnel Involved in Defense Resourcing (#27).
DoD is also making a more deliberate effort to Encourage Improved In-Person Communication (#17) by engaging with Congress on year-of-execution issues, fact-of-life changes, and program updates that would impact their markup of the FY 2025 President’s Budget (PB). By engaging now, the need for future time-consuming reprogrammings can be alleviated by having the resources correctly realigned as part of the final enacted authorization and appropriation bills.
The Department has also reviewed the Commission’s Final Report recommendations and plans to publish implementation plans and develop the associated courses of action once the additional recommendations have been approved. The Office of the Under Secretary of Defense (Comptroller) has established a dedicated ‘PPBE Reform’ page at https://comptroller.defense.gov/PPBE-Reform/ to share information on the Department’s implementation efforts.
Congressional action supporting Commission recommendations is encouraging. The signed NDAA for FY 2025 directs the DoD to Establish a Cross-Functional Implementation Team for Commission Recommendations (#28), revise the DoD Financial Management Regulation (Review and Update PPBE-Related Guidance Documents [#12]), revise the authorization language for the Defense Modernization Account to allow for the funds to promote innovation and integration of commercial technologies and services (#16), and requires biannual reports on implementation of the Commission’s recommendations.
On the appropriations side, the House Appropriations subcommittee on Defense included $5 million to support the Development of Communication Enclaves (#19), encourages collaboration between DoD and Congress on resourcing issues, and looks forward to continued discussion on the Department’s views on the Commission’s recommendations.
The Senate Appropriations Subcommittee on Defense supports the DoD actions to implement the 13 Commission Interim Report recommendations that can be done without changes to statute nor require congressional action. These include: Improved Information Sharing and Effective Communication with Congress (#17); Continued Rationalization of the Office of the Secretary of Defense Resourcing Systems (#23); Reviewing and Consolidating BLI (#10); Continued Focus on Recruiting and Retention for the Resourcing Workforce (#25); Improve Training of Defense Resourcing Personnel (#27); and Streamlining Process and Improving Analytic Capabilities (#26). The Committee also transferred funding for the DoD data analytics platform, Advanced Analytics (ADVANA), to the Budget Activity Eight (Software and Digital Pilot Program) in Research, Development, Test, and Evaluation (RDT&E) for more adaptable execution (Addressing Challenges with Colors of Money [#11]). The Committee also supports establishment of a DoD Task Force to ensure the Department is working with Congress on implementation efforts. Both Sub-Committees also Increased the Below Threshold Reprogramming Limits (#8) to $15 million for Military Personnel, Operation and Maintenance, Procurement, and RDT&E appropriations in the DoD Appropriations Act, 2024. That Act also directed the United States Army (Army) to consolidate the BLIs in its Other Procurement, Army appropriation (#10). While the Congress has expressed some concerns regarding some of the Commission’s more far-reaching recommendations, these changes represent the first significant steps toward lasting reform of the PPBE process and the results that can be achieved when the Department and Congress work together.
Despite the frequent finger pointing the Commission heard during its research, PPBE process inefficiencies fall on both the DoD and Congress and will require teamwork and a strong partnership to improve the delivery of capability to the warfighter. The DoD need and requests for more flexibility come with the need to ensure appropriate congressional oversight. Many changes will rely on the willingness of DoD and Congress to work together to achieve a more efficient resourcing process the DoD can leverage now and into the future. Significant effort over time will show how successful both parties are in achieving lasting reform.
In accordance with the established language in the NDAA, the Commission ceased operations on August 28, 2024. We would like to once again sincerely thank everyone who supported the Commission’s research and encourage everyone involved in resourcing to be agents for change to preserve our national security by delivering the very best that we can to our warfighters.
This is a reprint of an article that appeared in the Summer 2025 edition of the AGA Washington, DC Chapter Newsletter.