The U.S. Missile Defense Agency (MDA) fielded fewer assets,

conducted fewer tests and spent


$1 billion more

than originally planned for its most recently completed block of capabilities, according to a new report by a government watchdog agency.

The March 14 report by the U.S. Government Accountability Office


, “Progress Made in Fielding Missile Defense, but Program is Short of Meeting Goals,” examined the MDA’s second block of capabilities, known as Block 2006, completed at the end of 2007. This audit, the fifth in a series of annual reports, took place from May 2007 to March 2008.


found the agency did not achieve

most of the goals it originally set in 2005 but that it did meet or exceed most of a revised set of goals it came out with in 2006.

The report also credited

the MDA for making

progress in improving the transparency of its programs.


studied nine programs the agency is developing or fielding that account for about 77 percent of its budget:

Airborne Laser; Aegis Ballistic Missile Defense;

Ground-Based Midcourse Defense;


Kinetic Energy Interceptor;

Terminal High Altitude Area Defense;

Multiple Kill Vehicles;

Space Tracking and Surveillance System;

and Command and Control, Battle Management and Communications.

The MDA made further progress in developing the

nation’s ballistic missile defense system under Block 2006.

The agency fielded 14 more ground-based interceptors, 12 more Aegis Ballistic Missile Defense missiles designed to engage more advanced threats, five more Aegis Ballistic Missile Defense ships, and additional Command and Control, Battle Management and Communications hardware and software. While the agency missed

nearly all of the original goals it submitted to Congress in March 2005, it met or exceeded most of the revised goals it submitted

one year later.

The GAO estimates the total cost of Block 2006 was between $1.3 billion and $1.9 billion in excess of the MDA’s

original cost estimate

, but the exact overrun

is unclear because some work has been deferred to subsequent

blocks. A March 2007 GAO report

indicated the block was $1 billion over budget

because of overruns in the Ground-Based Midcourse Defense system.

MDA spokesman Rick Lehner in an e-mail response said the agency’s goal for the block was originally $20 billion, which it exceeded by a total of $1 billion. Work on the Ground-Based Midcourse Defense system, Aegis Ballistic Missile Defense system, the Sea-Based X-Band radar and other radar systems has been extended beyond Block 2006, Lehner said.

This year’s

report found that in 2007 some prime contractors experienced cost growth on their programs

, but that it was

difficult to track because MDA policies

have allowed planning methodologies that can obscure the time and money needed to produce the intended outcomes


Tests in five of the nine programs reviewed by the GAO

experienced delays during Block 2006


but all were able to achieve their primary test objectives, the report said.

But the audit also

said tests of the systems, both developmental and operational, have not been thorough enough. The tests

have been developmental in nature and have lacked the

realism necessary for the Pentagon’s test and evaluation director to determine if the missile defense architecture is suitable and effective for battle, the report

said. Further testing is needed to provide a high level of confidence that

the models and simulations are accurate; therefore

the GAO was unable to assess whether the MDA met its overall performance goal for this block, the report said.

Prior to December 2007, the MDA had organized its capabilities in two-year increments known as blocks. The first – Block 2004 – fielded a limited capability including elements of the Ground-Based Midcourse Defense system, the Aegis Ballistic Missile Defense system, the Patriot Advanced Capability-3, and the Command and Control, Battle Management and Communications system

. The

Block 2006 capability was completed Dec.

31, 2007,

and included upgrades to all of the previous block’s systems as well as a Forward-Based X-Band Transportable radar.

A new

structure unveiled by the MDA


7 moved away from blocks based on time periods to blocks based on five distinct mission areas.

The GAO report praised this transition, saying it should make costs on MDA programs more transparent. The GAO previously said

the unprecedented funding and planning flexibility provided by the earlier block structure

expedited the progress of fielding a ballistic missile defense system but allowed for less oversight and accountability.

Under the new structure, funding for one

block cannot be deferred to another

as the previous structure allowed. The MDA also will

be required for the first time to provide estimated unit costs for certain assets and report any variances that occur. Finally, the MDA will begin purchasing certain assets with procurement dollars instead of research and development dollars, ensuring the assets will be fully paid for in the year they are bought.

Further steps can be taken by the agency to increase accountability, the report said. One example would be estimating the cost of an entire block, which the MDA does not currently do but plans to do at a future date.

Based on the findings of this report, the GAO delivered a series of policy recommendations to the U.S. Secretary of Defense, most of which the Defense Department agreed with in written responses.