ABOARD A US AIR FORCE C-40B — As Pentagon planners work to develop the fiscal 2018 budget plan, they will focus on increased spending for munitions and growing the prototyping budget for the Strategic Capabilities Office, Deputy Secretary of Defense Bob Work said Sunday.

Speaking to reporters while returning from the Reagan National Security Forum, held outside Los Angeles, California, Work acknowledged the realities that the budget would be finalized by the team of President-elect Donald Trump but added that he and Secretary of Defense Ash Carter wanted to leave a suggested road map for the new team.

"We took a careful look at all the different inventory objectives and tried to improve by expanding munition procurements as much as we can," Work said. "I can't get into specifics, because it's the PB18 budget and that is nothing more than a recommendation to the incoming administration. They may tweak it, they could add more money, but the recommendation we are sending forward has a heavy emphasis on improving our munitions position."

As the fight against the Islamic State group enters its third year, Pentagon officials are sounding the alarm over the level of munitions available to US forces. It has also become a concern among allies who buy US weapons for their stockpiles.

On his way to the Reagan forum, Work stopped off at facilities from both Boeing and Raytheon, the latter of which he called "the best missileers in the world." Part of that involved touring a Raytheon location that has automated much of the missile assembly process, shaving time and cost off the process involved in getting munitions ready for the US.

"They have great ideas and it was really good to see they are all in on the third offset [strategy] and, that type of thinking is starting to inform the way they are thinking about improvements to their missiles. So that was really impressive," Work said of the Raytheon plant.

Tangential to the question of funding on munitions is the question of improving existing designs, which is a focus for the Strategic Capabilities Office (SCO) — a group that Work said "did very well" in the proposed FY18 budget.

A semi-secretive unit started by Carter, the SCO focuses on improving and developing technologies that can be developed for near-term reasons. Led by William Roper, the group has had early successes, including adding an offensive capability for the SM6 weapon and upgrading the Army's Tactical Missile System weapon to allow it to strike moving targets on both land and water.

The office, which is slated to receive $907 million in the National Defense Authorization Act, has funded 26 prototyping projects, with six having transitioned so far. That number is expected to grow in the FY18 budget.

Work praised how Roper has linked up with the service and combatant command leaders to understand their requirements, which has allowed the SCO head to talk directly with major defense firms and reassure them that if they develop certain technologies, there will be business waiting for them. That is "an important signal to send," Work noted, adding that firms like Boeing and Raytheon now know to approach Roper directly with new ideas rather than waiting for a formal solicitation.

"When SCO first started they had about $50 million the first year in projects. They’re upwards of $1 billion now.," Work said. "When SCO comes in with a proposal, it is very well thought out and usually the majority of them get approved."

However, the deputy warned against giving SCO too much funding and having it turn from the lean, prototyping cell it is now into a full-fledged acquisition agency.

"The thing we have to watch is SCO is a relatively small organization; we don’t want it to become a DARPA. We want it to stay a Skunk Works, which is really fast, which gets demonstrations and gets things out really fast," Work said, referring to a Lockheed Martin program. "So we just go to make sure that we don’t overwhelm SCO."

About Aaron Mehta

Aaron Mehta was deputy editor and senior Pentagon correspondent for Defense News, covering policy, strategy and acquisition at the highest levels of the Defense Department and its international partners.

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