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U.S. Department of Defense FY 2016 Budget Summary

Core Content

The FY 2016 budget request for the U.S. Department of Defense (DoD) totals $585.2 billion, representing a 4% increase over the FY 2015 enacted level of $560.3 billion. This budget aims to sustain the alignment with the 2014 Quadrennial Defense Review (QDR), address ongoing security and fiscal challenges, and support a balanced, ready, and modernized military force.

The budget is structured around several key themes:

• Seek a Balanced Force
• Manage Enduring Readiness Challenges
• Continue to Focus on Institutional Reform
• Pursue Investments in Military Capabilities
• Provide for the People
• Support Overseas Contingency Operations

The FY 2016 base budget is $534.3 billion, an increase of $38.2 billion from the FY 2015 enacted level of $496.1 billion. The Overseas Contingency Operations (OCO) budget is $50.9 billion, a 21% decrease from the FY 2015 enacted level of $64.2 billion.

Main Points

1. Seek a Balanced Force

• The DoD is transitioning from a force focused on counterinsurgency and stability operations to a more agile, flexible, and technologically superior Joint Force.
• The 2014 QDR outlines three pillars of the defense strategy:
  • Protect the homeland
  • Build security globally
  • Project power and win decisively
• The budget supports these pillars through investments in missile defense, nuclear modernization, cyber capabilities, and maintaining capacity to protect U.S. airspace and shores.

2. Manage Enduring Readiness Challenges

• The DoD continues to prioritize full-spectrum readiness, enhancing the ability of forces to be mission-ready at any time and anywhere.
• Investments in training technologies, force protection, command and control, intelligence, surveillance, and reconnaissance (ISR) systems are key to maintaining global military superiority.
• The budget aims to reduce the size of the force while improving its readiness and capability.

3. Continue to Focus on Institutional Reform

• The DoD is committed to reducing the "cost of doing business" through budgetary efficiencies, reducing overhead, and streamlining operations.
• Efforts include:
  • Reducing management headquarters and overhead
  • Slowing the growth of personnel costs
  • Enhancing contract competition
  • Eliminating unneeded facilities and infrastructure
• The Department is requesting Congressional authority to conduct another round of Base Realignment and Closure (BRAC), starting in FY 2017.

4. Pursue Investments in Military Capabilities

• The budget emphasizes modernization and innovation to maintain U.S. military superiority.
• Key areas of investment include:
  • Aerospace Innovation Initiative (DII)
  • Space and space-based systems
  • Cyberspace operations
  • Precision strike capabilities
  • Nuclear deterrence
  • Intelligence, surveillance, and reconnaissance (ISR)
• The Defense Innovation Initiative focuses on:
  • Long-range research and development
  • Innovative leadership
  • War-gaming and operational concepts
  • Innovative business practices

5. Provide for the People

• The budget supports military compensation, healthcare, civilian pay, and family assistance.
• Personnel costs make up nearly half of the DoD budget.
• The budget includes efforts to slow the growth of military pay and healthcare costs, although these changes are proportionally small compared to other reforms.
• The Military Compensation and Retirement Modernization Commission is referenced as part of the broader effort to modernize pay and benefits.

6. Support Overseas Contingency Operations

• The FY 2016 OCO budget of $50.9 billion supports:
  • Operation FREEDOM'S SENTINEL in Afghanistan
  • Operation INHERENT RESOLVE in Iraq and Syria
  • Post-Operation NEW DAWN activities
  • Training and equipping Iraqi and Syrian opposition forces
  • Support for European allies against Russian aggression
• The budget also includes funding for counterterrorism and special operations.

Key Information

• The FY 2016 budget is designed to sustain a balanced force while managing fiscal and strategic uncertainty.
• The budget reflects a reduced military presence in Afghanistan and Iraq, with a focus on transitioning to a more capable and agile force.
• The sequestration mechanism is a major concern, as the QDR strategy cannot be executed at the sequester-level funding.
• The Defense Strategy requires a robust and modernized military to protect U.S. interests, deter aggression, and support allies.
• The budget includes specific force structure reductions:
  • Army: From 490,000 to 450,000 by FY 2018
  • Marine Corps: From 184,100 to 182,000 by FY 2017
  • Navy: Includes a 14-ship Littoral Combat Ship (LCS) program, with the last 5 ships in modified configuration, and plans to overhaul the USS GEORGE WASHINGTON (CVN-73).
• The FY 2016–2020 topline shows a modest increase in base budget, with a decline in OCO funding.

Conclusion

The FY 2016 budget is a strategic effort to modernize and balance the military force, enhance readiness, and address fiscal and security challenges. It reflects a shift in focus from large-scale counterinsurgency to a more technologically advanced and globally postured force, while also seeking to reduce costs and improve efficiency. The budget also highlights the need for institutional reform, innovation, and Congressional support to achieve these goals.