oversight

Too Many Crew Members Assigned too Soon to Ships Under Construction

Published by the Government Accountability Office on 1971-08-09.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

REPORT TO THE CONGRESS




Too Many Crew Members
Assigned Too Soon To Ships
Under Construction         80172632




Department   of the Navy




BY THE COMPTROLLER GENERAL
OF THE UNITED STATES
              5s
                          COMPTROLLER     GENERAL    OF    THE    UNITED   STATES
                                        WASHINGTON    DC     20242




             B-172632




             To the President   of the Senate and the
        ii   Speaker  of the House of Representatives

                      This IS our report on too many crew members     assigned
                                                                                                     /
    t        too soon by the Department     of the Navy to ships under con-
             struction
/

                    Our review was made pursuant  to the Budget and Account-
             mg Act, 1921 (31 U S C 53), and the Accounting   and Audltmg
             Act of 1950 (31 U S C 67)

                    Copies of this report  are being sent to the Dlrector,                     Of-
             fice of Management    and Budget, the Secretary   of Defense,                    and
             the Secretary  of the Navy




                                                                           4.
                                                                 Comptroller        General
                                                                 of the United      States




                              50 TH ANNIVERSARY             1921-1971
I
I

i
I
I                .qOMPTROLLERGEflER4L'S                       TOO MANY CREW MEMBERSASSIGNED TOO SOON TO
1
I
                  REPORTTO THE COflGRESS                      SHIPS UNDER CONSTRUCTION
I                                                             Department of the Navy B-172632
I
 I
 I
 I               DIGEST
                 ------
 I
 I
 I
 I               WHYTHE REVIEW WASM4DE
 I
  I
  I                     The Navy assigns nucleus or skeleton    crews for temporary   duty                   periods
  I                     up to 6 months to ships under construction    to ensure delivery                     of ships
 I
    I                   with tralned,  well-organized crews
    I
    I
    I                   Since the assignment of nucleus crews of experienced       personnel  to ships
    I                   at construction   sites involves     a significant amount of valuable man-
    I
    I                   power and since the payment of per diem to these crew members while
                        on temPorarv duty increases      ship construction  costs, the General Ac-
    I
    I
                        counti iig of+1ce ]GAO) examined into whether personnel      assigned to these
    I                   ships were being used efficiently
    I
    I
    I
    I            FINDINGS AND CONCLUSIONS
    I
     I
     I                  Over 2,800 enlisted        men representing  more than 980 man-years costing
     I
     I                  about $6 2 million        had been assigned to temporary  duty as nucleus
     I                  crews for 43 ships        during the 12-month period ended July 31, 1970
     I
                        (See p 6.)
        I
        I
        I
                        GAO     reviewed crew assignments      for   five     of these   ships   and found     that
        I
        I                     --The number of personnel     assigned        to a nucleus crew was based on
        I
        I                        personal JUdgt’nent and precedent,         rather than on actual need
         I                       (See P 8 )
         I
         I
         I                    --Some crew members had been sent to construction   sites before they
         I
         I
                                 were needed   They also had been assigned to perform certain     tasks
         I                       that already were the responslbllitles  of other Navy organizations
        I
                                (Seep lo)
        I
        I                     --The Navy had not evaluated  work requirements    to determine                the type
         I                       of personnel that should be included   in a nucleus crew
         I                       (See Pp 13 and 22 )
         I

         I                    --The system for    obtaining   information       on the use of nucleus         crews
         I
                                 was inadequate      (See p 22 )
         I
         I              In January 1971 the Navy approved a pilot   program to place a Fleet In-
         I
         I
                        troduction Team on permanent shore duty at bullding    sites to accomplish
                        many of the tasks currently  performed  by nucleus crews     (See pp 19
         I              and 24 )
         I
         I

             I
             I
             I   Tear Sheet
                                                                                            MJG       91197a
                                                              1
             1
             I
             I
    This pilot  program represents    a s?gnIflcant     departure  from tradItIona
    manning practices   for new-construction      ships    GAO believes   that the
    Navy can provide a means for better      use of manpower resources       if It lim-
    Its the assignment of nucleus crews to the mlnlmum size and composition
    needed to fulfill   their missions


RECOMMENDATIONS
             OR SUGGESTIONS
    Because of the Navy's       opportunity  to reduce manpower requirements     and
    per diem expenditures,       GAO IS recommending that the Secretary     of the
    Navy

      --Determine      the essential    functions    that     nucleus    crews should      per-
         form

      --Evaluate   the composition       and duration       of manpower needed to per-
         form these functions.

      --Asslgn   to nucleus crews only         the required      rates    and ratings      for        the
         man-months needed

      --Establish   procedures   which will provide for a continual      evaluation
         of nucleus crew needs, lncludlng     the requirement    that prospective
         commanding effacers    recommend needed changes to nucleus crew au-
         thonzatlon    In their monthly ships'    progress reports

       --MOnltor     the actions  already    taken by the Navy,          to make certain          that
          valuable    manpower resources     are used effJclently.

AGENCYACTIONS AND UNRESOLVED
                           ISSUES
    The Navy concurs with GAO's recommendations            (See app I ) Actions    to
    refine    current  manpower assignment    practices,   with the goal of USI ng
    available     manpower effectively,   have been initiated     by the Navy   (See
    p 24 ) These actions         include

      --Establishing   an ad hoc panel to study             and recommend solutions              to
         problems associated  with the delivery             of new ships.

      --Performing    a manpower survey, using applied              work-measuring tech-
         niques,   to document the manpower needed for              a nucleus crew

   The Navy IS generally deferrlng          further   comments on these         actions     until
   its studies have been completed          and reviewed,

   GAO belleves   that    the actions    ln-rttated by the Navy are Important               steps
   toward determining      more valid    nucleus crew manpower requirements.




                                   2
I
I           MJTTERSFUR CONSIDEEtQTIOA'
                                    BY THE CONGRESS
I
I                  In the light  of recent and antlclpated    budgetary restraints,      this re-
I                  port is to inform the Congress of the Navy's opportunity         to reduce costs
I
I                  and manpower needs by modifying    its nucleus crew program
I
I
I
I


I




    I
    I
    I
    I
            *
    I
    I
    I
    I
    I

    1
    I
    I
    I
    I
    I

    :
    I
    I
    I




        I
        I   Tear Sheet
        I                                          3
                          Contents
                                                              Page

DIGEST                                                          1

CHAPTER

     1     INTRODUCTION                                         4
               Personnel assigned    to nucleus   crews         6

     2    OPPORTUNITYTO BETTER USE MANPOWER       RESOURCES
          AND TO SAVE PER DIEM COSTS                            8
              Nucleus crew manpower requirements                8
                   Necessary functrons    and responsi-
                     bilities                                  10
                   Manpower required for present func-
                     tions and responsibilities                13
              Fleet Introduction     Team                      19
              Navy review procedures                           22
              Conclusions                                      22
              Reconrmendatlons                                 23

     3     AGENCYCOMMENTS
                        AND GAO EVALUATION                     24

     4     SCOPEOF REVIEW                                      26

APPENDIX

     I     Letter dated February 23, 1971, from the
             Assistant  Secretary of the Navy (Financial
             Management) to the General Accounting Of-
              flee                                             29

  II       Principal    officials   of the Department of
              Defense and the Department of the Navy
              responsible     for activitres discussed in
              this report                                      35

                           ABBREVIATIONS

co         commanding officer
FIT        Fleet Introduction   Team
GAO        General Accounting Office
PC0        prospective   commanding officer
COMPTROLLERGENERAL'S                      TOO MANY CREW MEMBERSASSIGNEDTOO SOON TO
REPORTTO THE CONGRESS                     SHIPS UNDER CONSTRUCTION
                                          Department of the Navy B-172632


DIGEST
_-----

WHYTHE REVIEW WASMADE
    The Navy asslgns nucleus or skeleton    crews for temporary duty                 periods
    up to 6 months to ships under construction    to ensure dellvery                 of ships
    with tralned,  well-organized crews

     Since the assignment of nucleus crews of experienced          personnel  to ships
     at construction     sites involves     a slgnlflcant amount of valuable man-
     power and since the payment of per diem to these crew members while
     on temporary    duty increases     ship construction  costs,  the General Ac-
     counting OffIce     (GAO) examined into whether personnel       assigned to these
     ships were being used efficiently


FINDINGS AND CONCLUSIONS
     Over 2,800 enlisted      men representing  more than 980 man-years cost-rng
     about $6 2 million      had been assigned to temporary duty as nucleus
     crews for 43 ships      during the 12-month period ended July 31, 1970
     (See P 6 >
     GAO reviewed      crew assignments    for   five     of these   ships   and found     that

         --The number ot personnel asslgned             to a nucleus crew was based on
            personal Judgment and precedent,            rather than on actual need
           ISee P 8 )
         --Some    crew members had been sent to construction  sites before they
            were   needed   They also had been assigned to perform certain     tasks
            that   already were the responslbllltles  of other Navy organizations
            (See   p 10 )

         --The Navy had not evaluated work requirements    to determine                  the type
            of personnel that should be included  In a nucleus crew
            (See Pp 13 and 22 )

         --The system for     obtaining lnformatlon         on the use of nucleus         crews
            was inadequate      (See p 22 >
     In January 1971 the Navy approved a pilot program to place a Fleet In-
     troduction Team on permanent shore duty at bulldIng   sites to accomplish
     many of the tasks currently  performed by nucleus crews     (See pp. 19
     and 24 )
    This pllot  program represents    a significant     departure     from traditional
    manning practices   for new-construction      ships    GAO    believes   that the
    Navy can provide a means for better       use of manpower resources         if it llm-
    its the assignment of nucleus crews to the mlnlmum size and composltlon
    needed to fulfill   their missions,


RECOMMENDATIOiUS
             OR SUGGESTIONS
    Because of the Navy's       opportumty   to reduce manpower requirements     and
    per diem expenditures,       GAO 1s recommending that the Secretary     of the
    Navy

      --Determine      the essential    functions     that    nucleus    crews should      per-
         form

      --Evaluate   the composltlon       and duration        of manpower needed to per-
         form these functions

      --Assign   to nucleus crews only         the required      rates    and ratings      for        the
         man-months needed

      --Establish    procedures which will provide for a continual       evaluation
         of nucleus crew needs, including      the requirement   that prospective
         commanding offtcers     recommend needed changes to nucleus crew au-
         thorization    in their monthly ships'   progress reports

       --Monitor     the actlons  already     taken by the Navy,         to make certain          that
          valuable    manpower resources      are used efficiently


AGENCYACTIONSAND UNRESOLVED
                          ISSUES
    The Navy concurs with GAO's recommendatjons          (See app I ) Actions to
    refine    current manpower assignment practices,     with the goal of using
    available     manpower effectively, have been initiated     by the Navy   (See
    p 24 ) These actions include

      --Establishing   an ad hoc panel to study              and recommend solutions             to
         problems associated  with the delivery              of new ships

      --Performing  a manpower survey, using applied                work-measuring tech-
         niques, to document the manpower needed for                a nucleus crew

   The Navy 1s generally deferring          further   conments      on these    actions     until
   its studies have been completed          and reviewed

   GAO believes   that    the actions    Initiated      by the Navy are important           steps
   toward determining      more valid    nucleus     crew manpower requirements
MATTERSFOR CONSIDERATION
                       BY THE CONGRESS
    In the light  of recent and anticipated    budgetary restraints,      this re-
    port 1s to inform the Congress of the Navy's opportunity         to reduce costs
    and manpower needs by modlfylng    its nucleus crew program
                                 CHAPTER1

                              INTRODUCTION

      Navy officer   and enlisted  personnel normally are as-
signed to the crew of a non-nuclear-powered         surface ship
undergoing construction    or conversion     in two general groups,
the nucleus crew and the balance crew. Nucleus crew person-
nel are ordered directly     to the building    shlpyard or conver-
slon site prior to commisslonlng of the ship.           Balance crew
personnel report to the ship about the time the ship IS
completed or commlssloned.

       The nucleus crew corlslsts of experienced personnel.
Officers   of the nucleus      rew normally are the prospectrve
commanding officer           f
                      (PC01 and the department heads.        Also
part of the nucleus crew IS a cross sectlon of the senior en-
lrsted pay grades wlthln the crew allowance and the maJorlty
of the key enlisted    ratings    of the supply and engrneerlng   de-
partments.
      The balance crew consists          of the remarnlng ship's crew
allowance not assigned to the nucleus crew. The balance
crew's enllsted       men and officers,      including     the prospectrve
executive    officer,     department assistants,        and dlvrsron     offl-
cers,   are  ordered    to  a Fleet  Tralnrng     Center    for   5 to 6  weeks
of organrzed precommlssronlng          trarnrng.       This trarnlng    usu-
ally IS scheduled to permrt the balance crew to report to a
naval actlvlty      In the vlclnlty      of the delivery       point 1 week
prior to the ship's completion           or commisslonlng date.

        The Navy's Career Enlisted Rotatron System provides for
rotation    of ellglble    enlisted    personnel from sea duty to
shore duty and from shore duty to sea duty.              The perrod of
time personnel are assigned to erther a nucleus crew or a
balance crew xs consldered          to be part of their sea duty ob-
llgatlon.     Enlrsted personnel assigned to a converted or
newly constructed       shop generally     are completing,   and are as-
slgned from, a normal toclr of shore duty.            They can, however,
be transferred      from a sea duty assignment.

1Officer  In charge of a ship not yet commrssloned.  The PC0
 becomes the commandrng officer  when the ship 1s commissioned
 and turned over to his command.

                                      4
         Durrng the period of assrgnment to a nucleus or bal-
ance crew, the officer         and enlisted    personnel are normally
on temporary duty and receive per diem In accordance wrth
the Joint Travel Regulations          applicable    to military person-
nel.      The current prescribed      dally rate of $25 is subJect to
reduction      when adequate Government quarters and/or messing
facllltles      are available.

       Navy offlclals     told us that a nucleus crew was assigned
to a ship under construction           to ensure that the best pos-
sable product,      conslstlng    of both a ship and a trained,      well-
organized crew, would be delivered.             To accomplish this ob-
Jectlve   a nucleus crew (1) assists In ldentlfylng           ship con-
struction   deflclencles,      (2) assists     In assembling the pre-
commlsslonlng outfit        (materials,    repair parts, and other
supply items), (3) prepares the organlzatlon            of the ship,
and (4) becomes familiar        with the details     of the ship's op-
eration.
PERSONNELASSIGNEDTO I'@CLEUSCREWS
        The Chief of Naval Operations is responsible      for es-
tablishlng    the number and type of positions    authorized     for
nucleus and balance crews. The process of assembling a
crew for a ship under construction      or conversion begins
when the Chief of Naval Personnel issues a ship-manning
directive.     The manning directive  includes the requirements
for the nucleus and balance crews, the requirements          for
ratings,and    the places and dates for the crews to report.
      For the 12-month period ended July 31, 1970, ship-
manning dlrectives    had been issued for 43 ships under
construction    or conversion.    These directives    had provided
for the assignment of over 2,800 enlisted personnel to
nucleus crews for periods of 3 to 6 months.          The total en-
listed manpower authorized by these dlrectrves         represented
almost 11,800 man-months, or over 980 man-years costrng
about $6.2 million.      Depending on the extent of Government
quarters and messrng facilities      available    for assignment
to the nucleus crew, the per diem paid to these enlisted
personnel,   based on the current rate, could vary from about=
$720,000 to almost $9 million.
       The above man-months and per diem cost figures do not
take into account slippages in the delivery or commisslon-
ing dates of the ships to which personnel are being assigned.
Nucleus crew members are selected for assqnnxmt         and placed
under orders between 8 and 10 months prior to the ship's
projected    commlsslonlng date.     Although projected delivery
dates at the lo-month time frame permit personnel planning,
they have been sufficiently      rnaccurate to result in costly
and inefficient    manpower management.
       Of 20 ships delivered  in fiscal year 1969, only five
were commissioned in the month forecasted at the time
manning declslons had to be made. Past experience has
shown that delays of 2 or 3 months in scheduled delivery     or
commissioning dates may be expected.     These delays will
substantially    increase the man-months and per diem cost
figures cited above.
     We made a brief rnqurry      into the costly     and inefficient
manpower management resulting       from inaccurate    delivery

                                 6
dates.     Also the Navy recognized the need to xmprove com-
municatlons     concerning sllppage in ship construction
schedules with offlclals      responsible    for assigning nucleus
crew personnel.       The Navy issued an lnstructlon      which, if
properly    implemented,   we belleve   will  minimize   the  adverse
effects    on manpower resources caused by delays.          Conse-
quently we concentrated      our review on examining into whether
personnel assqned to nucleus crews were being used ef-
f1c1ently.




                                  7
                            CHAPTER2

        OPPORTUNITYTO BETTER USE MANPOWER
                                        RESOURCES

                   AND TO SAVE PER DIEM COSTS

       The assignment of nucleus crews to ships under con-
structlon   or conversion  1s based on precedent rather than
current need. Some nucleus crew members were not needed,
some were not needed for the full length of time assigned,
and some that were needed were not authorized.      Valuable
manpower which was already In short supply was not being
used In the most efflclent    manner, and per diem costs were
being incurred unnecessarily.      On the basis of a comparison
of the manpower authorized    with that reported as needed for
five ships we revlewed, at least 380 man-months costing
about $200,000 might have been better used and per diem
Costs of nearly $200,000 might have been saved.      (See P48.)
NUCLEUSCREWMANPOWER
                  REQUIREMENTS

       Manpower authorized  for a nucleus crew 1s not based on
an accurate estimate of need. The number of personnel au-
thorized   to be asslgned to a nucleus crew and the period of
time the nucleus crew 1s at the construction         site depends
on the ship's total crew allowance.         Under present Navy
policy applxable     to all ships, a nucleus crew numbers
about one fourth of the sh1pI.s total allowance.          The number
of personnel asslgned to a nucleus crew 1s based on per-
sonal Judgment and hlstorlcal     practxe.      Navy officials
were unable to provide us with any other Justlflcatlon           and
did not know of any pertinent     regulations    or lnstructlons
governing the size of a nucleus crew*

       A nucleus crew 1s authorized     to be asslgned at the
construction    site 4 months prior to the date the ship 1s
to be commlssroned.      In addltron,   for a ship wlrsh a total
crew allowance of more than 350, five of the nucleus crew
officers    and 30 of the nucleus crew enlisted       personnel are
authorized    to be at the construction     site 2 addltlonal
months, or a total of 6 months prior to the commlsslonlng
date.    We were told by offlclals     In the Bureau of Naval
Personnel that the Navy had no offlclal         basis for the
period nucleus crew personnel were to be assigned,
According to these offlclals,    the period       of temporary duty
cannot exceed the 6-month time llmltatlon          that per diem can
be paid without special Justlflcatlon.

       A nucleus crew 1s usually composed of personnel repre-
senting each ship department,        such as supply, weapons, en-
glneerlng,    and operations.     Offlclals     In the Office of the
Chief of Naval Operations furnished          us with a memorandum
dated May 22, 1969, which contained their rationale           For as-
signing particular      ratings  (such as boilerman)     and rates
(such as first     class) to represent      these departments for
new-construction      escort ships.
      The memorandum did not cover the question of whether
there was a need for particular       rates and ratings     at the
construction    site or a need for the ship departments to be
represented    by nucleus crew personnel.       It stated that al-
most all nucleus crew members were senior petty officers
with many years of experience       In their particular     ratings
and that these crew members had been responsible          for all
areas In which they were required         to be knowledgeable     for
their ratings.      Navy offlclals   said that experience galned
in previous precommlsslonlng       operations   provided the basis
for contlnulng     to make assignments In the manner followed
by the Chief of Naval Operations.
                                                                      .
Necessary   fwctlons     and responslbllltles

      The Navy 1s authorlzlng  manpower for nucleus crews to
perform functrons  and responslbllltres   that may be better
performed by personnel other than those of the nucleus crew,

      Supervisors   of Shlpbulldlng,     Conversion,     and Reparr
have as their basic mlsslons the responslbllltles              to admrnls-
ter Department of the Navy and other Department of Defense
shlpbulldlng,    desrgn, conversron,     repalr,    and faclllty      con-
tracts at assigned private      shlpyards.       Some of  the    specrflc
tasks and functions     assigned In the accomplishment of their
mlsslons are the same as those performed by a nucleus crew.

         Some of the tasks for which we noted that dual respon-
slblllty    exlsted Included (1) detecting        contractor's    work
Ghlch was not In conformance wrth contract            requirements,
(2) dlscoverrng      a need for and recommending operatlonal            de-
sign improvements,       (3) assessing the progress of the work,
and (4) determlnlng        that the contractor    properly performed
his frttlng-out      functions,    such as blnnlng and stowage of
repalr parts.       The most apparent difference        rn responslblllty
between the two actlvrtles         1s that the Supervlsors      of Ship-
bulldlng    have contlnulng     responsrbrllty    for these tasks and
functions     during construction     of the ship and the nucleus
crew IS responsrble        only during the frnal stages of con-
struction.

      Navy officials     acknowledged instances in which Supervl-
sors of Shlpbulldlng       had relred on the nucleus crews to per-
form some tasks and functions        for which there had been dual
responslbrllty.      Since the Supervisors     of Shlpbulldlng      should
have the caRablllty      to perform the tasks and functions         re-
qulred to accomplish their basic mlsslons,          the Navy might
better use Its manpower If nucleus crew personnel were not
also expected to perform some of these tasks and functions.
Ellmlnatlng     some of a nucleus crew's tasks and functions,
such as those where dual responsrbrllty         exists,     should enable
the Navy to decrease nucleus crew manpower. This would
permit the use of enlisted        men's skills  (particularly     for
those ratings     and rates of which there are shortages)         for
longer periods of time in the operating         fleet.
 b




                                     10
       Nucleus crews recerve trarnlng       (famrllarlzatlon     and
lndoctrlnatlon)      by observing the ship's being constructed
and by wltnesslng       the testing  of machinery and equipment.
Nucleus crew personnel,        however, generally     are not allowed
to operate any of the machinery or equipment until            after
the ship 1s delivered        to the Navy. PCOs of the ships we
reviewed expressed different        oplnlons regarding the value
of training     received by the nucleus crews.         For example, one
PC0 told us that the amount of experience received by his
nucleus crew at the shipyard was mlnlmal.             Another believed
that the training       received by his nucleus crew was rnvalu-
able.
       Training   In actual operation    of the ship's equipment 1s
accomplished during the lo- to 60-day flttlng-out-
avallablllty     perlod at the Navy yard after the contractor
delivers     the ship    Following the flttlng-out-avallablllty
period IS the readiness-for-sea        period of 1 to 3 weeks. The
purpose of this period 1s to provide the commanding officer
(CO) with an opportunity       to prepare for, among other things,
the organlzatlon      of the ship and the tralnlng       of the crew
to the maxmum attainable         level of combat readiness.

       In January 1970 the Office of the Chief of Naval Opera-
tions recognized that, for at least one class of ship,
2 months of training   aboard an operating ship would be more
than equivalent   to 6 months of observing a ship's being con-
structed.

       Beginning with the second ship In Instances when several
ships of the same class are constructed,     part of the person-
nel asslgned to the nucleus crew will report 2 months in ad-
vance of delivery    and will train on one of the completed
shrps.    Other nucleus crew personnel will be sent to the
Fleet Tralnrng Center as part of the balance crew.       Such a
change In procedure will allow the Navy to benefit      In two lm-
portant ways      (1) the crew will be better trained when re-
porting aboard at delivery     and (2) a manpower and per diem
saving will result because of the reduced nucleus crew re-
quirement at the building     shipyard.
      Since the Navy considers the time spent by personnel
assigned to a nucleus crew as lost to the operating   fleet,
any reduction  In the nucleus crew's authorized manpower

                                  11
would be economical because thus manpower could be retained
by the operating fleet.      The Navy considers a second-class
petty officer    or pay grade E-5 to be a representative    rate
for the nucleus crew, Department of Defense Instruction
7220.25 lists    the man-year cost for a pay grade E-5 as
$6,299.    A reduction  in nucleus crew manpower would result
in per diem savings which could be as much as $750 a month
for each man.




                               12
Manpower required for present
functions and responsibilities

       For the five ships in our review, the Navy had autho-
rized more man-months than were required to perform the
functions    and responslbllitles  assigned to nucleus crews.
In addition,    the manpower authorlzatlon  for these ships had
not provided for some personnel with the ratings and rates
needed as part of the nucleus crews.

       Without exception,  PCOs and COs of the ships we re-
viewed told us that more nucleus crew man-months had been
authorized    than they had considered necessary for dlscharg-
lng assigned functions    and responsiblllties.     Most of these
officers    believed that the number of personnel assigned and
the period of assignment should be reduced.        All the offi-
cers recommended a revision     in the composition    (ratrngs   and
rates) of the nucleus crew.      Cur findings   for the three
classes of ships in our review follow.

     Amphrbrous transport     dock (LPD class)

      This class of ship has a total enlisted     crew allowance
of 421 men. The authorized      nucleus crew consists of 30 en-
listed men to be assigned 6 months prior to the ship's com-
mlsslonlng    and an addItiona   75 enlisted men to be assigned
4 months prior to the ship's commissioning.       The manpower
authorlzatlon    provides for the nucleus crew personnel to
expend a total of 480 man-months prior to the ship's com-
missioning.

      A PC0 of one ship we reviewed told us that some of the
authorized    nucleus crew ratings   and rates should be revised.
He believed that about 375 man-months, or over 100 man-
months less than authorized,      would have been sufficient   for
his nucleus crew to perform Its assigned responslbilitles.
The proposed decrease in man-months was based on his belief
that some nucleus crew personnel should be assigned for
shorter periods of tame and that the number of personnel
assigned should be reduced about lo-percent.        Some of the
more significant     changes he advocated are shown below.




                                 13
                                       Nucleus crew manpower for LPD-class    ship
                                  --      Authorized           Recommended
                                                                    ---      by  PC0
            Ratmgs                 Number Number       Total Number   Number    Total
               and                    of         of    man-    of       of       llElll-
             rates                   men     --months months  men     months    months

Boatswain's            mate
     BMCS                                1        6               6
     BMC                                 1        6               6   -1      6         6
     BMC                                                                1     5         5
                                     -2           6           12          1   6         6
      iii                             2           4            8          1   5         5
      BM3                            -2           4            8      -             -
                                     -8                       40      -4            -22
Engmeman,
      ENC                                1        6               6     1     5         5
      EN1                                2        4               8     1     3         3
      EN2                                4        4           16        1     2         2
      EN3                                                               la    2         2
      ENFN                           -                                - la          -
                                     -7                               4             -12
Radloman.
     RMC                                 3                    12          1   6         6
     RMC                                                                  1   3         3
                                     --1                   --I5       -             -
                                     -4                       18      -2            -9
Electrician's            mate.
      EMC                                1        6               6       1   6         6
                                         2        4               8     2     4         8
                                                                        2a    2         4
                                     -                                - 2a          -
                                     -3                               -5            -18
               Total                 22                               15            6'1
aEIther        rate     would    be acceptable.

      In addition to savings that could result  from better
use of manpower, savings of about $45,000 in per diem could
result from a temporary-duty   decrease of 100 man-months.   At
the yard where this ship was constructed,   only those nucleus
crew personnel having second-class rates and above received

                                                      14
the maximum daily rate of $25. Men with third-class  rates
and below were provided with Government quarters and mess,
and each received $2 per diem.

     Replenishment    oiler   (AOR class)

       This class of ship has a total enlisted  crew allowance
of 350 men. For one ship we reviewed, 84 enlisted     men were
authorized   to be assigned to the nucleus crew for about
5 months, a total authorazatlon    of 420 man-months.   The CO
believed that a nucleus crew of approximately    the same num-
ber as that authorized    should be assigned but that the pe-
riod of assignment for most of the personnel should be re-
duced. He believed also that the nucleus crew would require
only 325 man-months, or about 100 man-months less than au-
thorized,   to accomplish the required work.
        The CO of another ship of the same class proposed a
nucleus crew of 55 enlisted        men for a total of 182 man-
months of duty.       The Navy authorization      for his ship pro-
vided for 30 enlisted       men to be assigned to the nucleus
crew for about 4-l/2 months and an additional             59 enlisted
men to be assigned for about 3 months, for a total of about
300 man-months.       This was over 100 man-months more than the
CO believed necessary.        In addition    to reducing the period
of assignment from that authorized          for some nucleus crew
personnel,     he deleted as unnecessary certain        personnel au-
thorized     as nucleus crew members.       Ratings   and  rates de-
leted included first-       and second-class     gunners' mates,
 first-    and second-class   electricians,     and firemen.

     A summary of the manpower of the authorized  nucleus
crew compared with that recommended by the COs follows,




                                   15
      Authorized                       Recommended by COs
Number    Number   Total            Number   Number    Total
  of        of    man-                of       of      man-
 men     months --
                 months              men     months months

                           Ship 1

  84      5                            8         6       48
                                      13         5       65
                                      20         4       80
                                     -44         3      132
                                                        325

                           Ship 2

  30      4-W       135                1         6        6
  59      3         177               10         5       50

                    312               19         4       76

                                      25         2




                             16
        Escort      shlpl(DE-1052             class)
       Thus class of shop has a total enlisted   crew allowance
of 210 men The authorized     enlisted  nucleus crew for this
class of ship consists   of about 50 men asslgned 4 months
prior to commissioning,   or a total of 200 man-months      PCOS
of two ships we reviewed believed that there could be a net
reduction   In the total man-month authorrzatlon     The method
by which each PC0 arrived at a reduced man-month requirement,
however, was drfferent.    One increased the number of person-
nel to be assigned to the nucleus crew and decreased the
net perrod of assignments and the second decreased the num-
ber of personnel to be assrgned and increased the net pe-
rlod of assignments.

       Both PCOs believed that the authorized   composition   of
the nucleus crew should be revised.     For instance,    they both
believed that the number of ratings and rates 1n the engr-
neerlng departments should be increased and that the number
of ratings and rates in the weapons departments should be
decreased.    A chart of the changes recommended by the two
PCOs 1s shown below.
                           Number of men            Number of months       Total   man-months
                                Recommended               Recommended              Recommended
       Rating       Autho-         by PC0         Autho-     by PC0      Autho-       by PC0
     and rates       razed    No 1      No 2       razed No 1 No 2       razed     No 1 No 2

Engineering    department
     Boilerman
           BTC           1       1          1           4   6    4          4         6         4
           BTl           2       2          2           4   4    4          8         8         8
           BTl                              1                    15         -         -         15
           BT2        ;-     -            -2                     15        --        23

                      =3     =3            6
                                          zx=                              g         14    16
Weapons department
    Gunner's mate
        GYGl         1           1            2         4   4    3           4         4        6
        GMG2         2           1                      4   4        -       8         4        -
        GMG3       -L        1            I             4   -        -     -4        --;

                       =4     2
                             czz=z        =2                                2%       ==8   6-


       The difference                between the two PCOs* recommendations
 for fewer man-months                  and revised nucleus crew compositions
 emphasizes the need                 for review of the Navy's nucleus crew
 program,to establish                 more reallstlc   manpower requirements.

                                                   17
        Reductxons in authorized    man-months proposed by the
PCOs and COs of the five ships (three classes) we revrewed
and the value of the manpower whrch could be used more ef-
flclently     are summarized below.    Also shown 1s the per drem
cost whxh could be saved by reducing the total man-month
authorlzatlons.      None of the figures shown take Into consld-
eratlon the possible manpower or man-month reductions         that
would result from the ellmlnatlon       of functions  for which
there are dual responsiblllties.
                                        PC0 and co
               Authorrzed               recommended           Net decrease
                         Man-                   ME%Il-                 MZI-                 Value of       Per drem
ship          Men      IUOl-OZhS       Men     months         Men     months               man-months      (note a>           w
 DE             51           204        69         170        lab                 34         $ 18,000      $ 8,000          $ 26,000
 DE             50           200        43         180            7               20           10,000          1,000           11,000
 AOR            84           420        85         325            lb              95           50,000        46,000            96,000
 AOR            89           312        55         182        34                 130           68,000         98,000         166,000
 LPD          105            @         94       375           11             105               55,000        45.000          100,000

              -379        ___
                          1,616        346
                                       --       -1.232        2                  384         $201.000
                                                                                              -            $198.000
                                                                                                            -_              $399 .ooo

 aComputed on the basis            of the per diem normally           received         by nucleus   crew enlisted      personnel
  at each buldmg   site
 b Increase




                                                                  18
FLEET INTRODUCTIONTEAY

       Early in our review we discussed with Navy officials
the possibility     of assigning qualified     personnel to ship-
yards on a permanent basis, in lieu of a nucleus crew to
each ship, to supervise all ships of the class or type un-
der construction     at the particular    shipyards.     The Navy
recognized that the concep t of a nucleus crew as constl-
tuted resulted    in the loss of manpower resources to the op-
erating forces and on June 2, 1970, issued a proposal on
"Manning of New Construction       Non-Nuclear Powered, Surface
Ships."     This proposal provides that a Fleet Introduction
Team (FIT), under the administrative         control   of the Super-
visor of ShlpbJilding,      be placed at designated private
building    sites on a permanent shore-duty       basis.

       FIT would be composed of a minimum of four officers           or
warrant officers    and an unspecified     number of enlisted     men,
handpicked for their talent,      experience,    and ability.     The
function   of FIT would be to accomplish certain        specific
tasks, including    some of those in the inspection        and slppl~
areas presently    accompllshed by a nucleus crew. Also FIT
would establish    a formal training     program, to be conducted
both on board and In the classroom, to introduce            the nucleus
crew to Its ship and the ship's equipment.           The proposal
does not eliminate     the nucleus crew.      It provides for a re-
duction in the period of time the nucleus crew would be as-
signed but not for a reduction       in the number of personnel to
be assigned or for a change in the nucleus crew's composl-
tion.

       As proposed, nucleus crew personnel would report in two
increments.      The first   increment would consist of five offl-
cers (Including     the PCO) and five enlisted      personnel who
would report 4 months prior to the scheduled delivery              of the
ship.    The second increment would consist of the remainder
of the authorized      nucleus crew, who would report to the
building    site to begin familiarization      with the ship and in-
stalled   equipment about 2 months prior to the ship's commls-
sioning.     This delay in the second increment's        reporting
would provide an additional        2 months for the Navy to analyze
the accuracy of the ship's projected        delivery    and commis-
sioning dates.



                                    19
      The balance crew would report at about the same time as
it does under the present manning policy.    It would go to the
precommlssioning  training  center for 5 to 6 weeks of train-
ing and then Join the ship Just prior to its delivery    or com-
missionrng.

        According to the proposal FIT would reduce markedly the
administrative    work loads of both the balance and the nucleus
crews and thereby enable concentration           of effort     on organiza-
tion, training,    and indoctrination.         The man-months'      savings
from delayed reporting     of the malorlty       of nucleus crew per-
sonnel would accrue to the fleet.           In  addition,     there would
be a reduction    in per diem costs, the amount depending upon
Government quarters and messing facilities             available    in the
vicinity    of the ship's building     site.     In summation, the
Navy pointed out in the proposal that:
      "A stable permanently assigned FIT, not requiring
      the repetitive     lndoctrlnatlon/orientatlsn            period
      needed by each ship's company, would soon develop
      the technical     proficiency      (learning     curve),
      knowledge of shipyard operations,             range of per-
      sonal contacts,      and procedural       expertise,     rarely
      if ever accumulated by a nucleus crew. ThlS
      talent,   coupled with a continually           growing fund
      of experience and feedback from the fleet and
      type commanders, should produce cost efficiencies
      in manpower utilization         far beyond the gross
      savings accruing from implementation              of the Team
      itself.    An additional      side effect would be the
      improved sea/shore rotation           for several ratings
      presently    considered in the deprived category."

       The proposal was circulated      and comments were requested
from various sources.       Two of the Supervisors     of Shipbuild-
ing for the bullding     sites included in our review opposed
the idea.     The third was in favor of the proposal but recom-
mended several revisions      to eliminate   potential   areas of
conflict.     One of his recommendations was that FITS be under
the administrative     control of the Iype Commander1 instead of

1A type command is a subdivision          of a fleet    involving       ships
 of the same type.

                                     20
the Supervisor  of Shipbuilding.    We concur with this recom-
mendation and believe that FIT should be under the command
of another Navy activity    to adequately represent  the re-
quirements of fleet operating personnel,
       One Supervisor of Shipbuilding    believed that a poten-
teal area of conflict    would arise because the proposal,      as
written,   included the suggestion of imposing an additIona
tier of inspection    on the contractor.     Another supervisor
believed that implementation     of the proposal would result
in claims from the contractor     for the added burden of
double inspection.

       All three supervisors   believed that some of the other
tasks that FIT was to perform, such as monitoring          the prog-
ress of the shipyard's     work in the later stages of con-
struction    and ensuring that supply items were placed on or-
der timely, would duplicate      their functions,     As previously
pointed out, dual responsibility       for some of these tasks
currently    existed between the Supervisors      of Shipbuilding
and the nucleus crews.




                                 21
NAVY REVIEW PROCEDURES

       The Deputy Chief of Naval Operations (Manpower and Na-
val Reserve) currently      has the responsibility   for manpower
validation     Navy officials     informed us that no in-depth
study had ever been made on the use of nucleus crews.          Also
we found no indication      that this matter had ever been looked
into by the Navy's internal      audit organization.

       We were told that the Navy had no procedures for obtam-
ing information    regarding the use or effectiveness      of the
nucleus crew other than the requirement       that the PC0 inform
the Chief of Naval Operations of the status of ship con-
struction.     The PC0 is required to submit progress reports
to apprise the Chief of Naval Operations,        among others, of
the general condition      and progress of the ship, including
information   and warnings of possible need for changes or
exceptions   to plans and pollcles.

      The Navy officials      could not recall any instance when
 it had been reported that nucleus crew personnel were not
needed at the construction        site or that the nucleus crew was
being ineffectlvely      used.   We   noted that in only one of the
progress reports submitted for the ships included in our re-
view had a recommendation been made to change the authorized
nucleus crew's manpower. All the officers           we interviewed,
however, told us that, In their         opinions,  some changes   in
the authorized     nucleus crew's manpower, ratings,       and rates
should be made.
CONCLUSIONS

       The Navy has not evaluated nucleus crew work require-
ments to determine needed ratings and rates.          The assign-
ment of personnel to nucleus crews is based on personal
judgment and historical      practice  rather than on established
need. As a result more manpower 1s authorized          for nucleus
crews than is needed to perform presently        assigned func-
tions.      Some assigned functions   might be better performed
by personnel other than the nucleus crew because dual re-
sponsibility     exists for some of these functions.

       The Navy's proposal to establish   FIT represents a sig-
nificant   departure  from traditional  new-construction manning
practrces   and could provide a means for better using manpower

                                 22
resources.    The need to assign the same number of personnel
to nucleus crews 1s questionable,however,   srnce FIT should
be performing   some of the tasks normally performed by the
nucleus crew. To adequately represent the requirements     of
the fleet,   FIT should not be under the administrative  con-
trol of the Supervisor of Shipbuilding.

       We believe that, in validating     nucleus crew manpower
requirements,    the Navy should examine critically       the actual
need for any task currently      performed at the construction
or conversion    site and should eliminate     any duplication    of
responsiblllty.      The Navy also should assign to nucleus crews
only those personnel who have valid and necessary functions
to perform at the building     site and should assign those per-
sonnel for only the period required to perform the necessary
functions.
RECOMMENDATIONS

       Because of the Navy's opportunity            to reduce manpower
requirements   and per diem expenditures,            we recommend that
the Secretary of the Navy:

     --Determine   the essential        functions     that   nucleus     crews
        should perform.

     --Evaluate  the composition         and duration        of manpower
        needed to perform those         functions.

     --Assign to nucleus crews only the required                 rates    and
        ratings for the man-months needed.

     --Establish    procedures which will provide for a contin-
        ual evaluation     of nucleus crew needs, including   the
        requirement    that PCOs recommend needed changes to
        nucleus crew authorizations      in their monthly ships'
        progress reports,

      --Monitor    the actions already taken by the Navy, to
         make certain      that valuable manpower resources are
         used efficiently.




                                   23
                             CHAPTER3

              AGENCYCOMMENTS
                           AND GAO EVALUATION

      The Assistant Secretary of the Navy (Financial   Manage-
ment) in commenting on our draft report (see app. I>, stated
that the Navy concurred with our recommendations but did not
concur fully with all the fIndings   as they were stated In
the draft report.   His specific  comments  are summarized be-
low.

      The Assistant    Secretary stated that the Navy recognized
the need to refine current manpower assignment practices,
with the goal of using available       manpower assets effectively
and reducing the expenditure       of per diem funds.       He stated
also that an ad hoc panel had been initiated          in April 1970
to study and recommend solutions        to problems associated with
the delivery   of new-construction      and conversion ships.       He
stated further    that the panel's draft report,        dated Decem-
ber 2, 1970, was currently      in distribution    within the Navy
for review and comments.

      In January 1971 the Chief of Naval Operations approved
the lnstitutlon    of a pilot program for two FITS and requested
a manpower survey of precommlssioning      crews (nucleus and bal-
ance crews>.     The manpower survey will document through ap-
plied work-measuring     techniques,  the manpower required for
a nucleus crew.     This survey will also evaluate work require-
ments to determine the rates and ratings        that should be in-
cluded in a nucleus crew. The results       of the manpower sur-
vey are anticipated     by the end of June 1971,and manning ad-
Justment will be implemented at that time.          The Assistant
Secretary stated further      that the Navy lnitlated    a reduced
nucleus crew program, whereby the number of men assigned to
the nucleus crews for two ships had been reduced to about
half the number formerly assigned.

        The Assistant   Secretary deferred comment on the Navy's
further     plans for using manpower assets more effectively
until    the evaluation   is complete and results   of the current
Navy studies and programs have been reviewed.          Comment was
deferred also on the FIT concept until        after the implementa-
tion and evaluation      of the approved pilot program and until


                                 24
a decision could be made as to whether FITS should be under
the administrative control of the Supervisor of Shipbuilding.

      During our fieldwork     we were told that the period that
personnel were assigned to a nucleus crew could not exceed
the 6-month time limitation      that per diem could be paid.
In his reply to our draft report, however, the Assistant
Secretary stated that the Navy's staffing          plan was not ori-
ented to the 6-month time limitation        for per diem funds.      He
said that the staffing     plan currently     being used had evolved
from past experience,    the need to manage properly manpower
assets, and the monitoring      of authorized     nucleus crew assets.
He stated also that the staffing       plan for new construction
and maJor conversion of ships had not been promulgated in
its entirety.   A Navy directive      promulgating     the staffing
plan is in draft form and 1s scheduled to be issued by the
end of June 1971.

      Regarding our recommendation that the Navy establish
procedures to ensure continual     evaluation of nucleus crew
needs, the Assistant    Secretary stated that instructions
would be updated to provide for comments from the PC0 on the
use of a nucleus crew. These comments will be submitted as
part of the Progress and Readiness Reports which the PC0
presently   1s required to submit,
      We believe that the actions initiated by the Department
of the Navy are important steps toward determining  more valid
nucleus crew manpower requirements.




                                  25
                               CHAPTER4

                           SCOPEOF REVIEW

      Our work included an examination into Navy policies,
procedures,   and practices     relatgng to the assignment of
nucleus crews to ships under construction            or conversion.
We also had discussions      with officials      in the Office of
the Chief of Naval Operations and the Bureau of Naval Per-
sonnel; with Supervisors of Shipbuilding,            Conversion, and
Repair; and with appropriate        personnel concerned with the
ships included in our review.          Our fieldwork      was performed
from January to September 1970 with the Supervisors of
Shipbuilding,   Conversion, and Repair in Seattle,            Washington;
Quincy, Massachusetts;      and   New  Orleans,    Louisiana.




                                   26
APPENDSXES




   27
                                                                         APPENDIX I




                       DEPARTMENT            OF   THE   NAVY
                         OFFICE     OF THE    SECRETARY
                          WASHINGTON          D C 20350




Mr Charles M. Bailey                                               23 FEB 1971
Director,  Defense Divlslon
U. S. General Accounting Cfflce
Washington, D. C. 20548
Dear Mr. Bailey'
    The Secretary of Defense has asked me to reply to your letter of
14 December 1970 which forwarded the GAO draft re-port on assignment
of nucleus crews to ships under construction  or conversion.
    I am enclosing   the Department of the tiavy reply to the report
                                              Sincerely        yours




                                                         CHARLESA. BOWSHER
                                                  ASSISTANT SECRETARYOF THE NAVY
                                                       (FINANCIAL MANAGEMENT)
Encl.
(1) U. S. Navy Reply on the Review of the Assx.gnment of Nucleus
      Crews to Ships Under Construction or Conversxon (OSD Case J/3%?)




                                        29
APPENDIX I

                                            u     s. NAVY REFLY

                                                       ON
                                                THE REVIEW OF

                               THE ASSIGNMENT OF NUCLEUS CREWS

                                              TO
                             SHIPS UNDER CONSTRUCTIOVOR CONVERSION

                                            (OSD CASE # 3212)


  I.       GAO FINDINGS AND TQXOi\3FNDATIONS.

  GAO revlel7ed the Navy practice    of asslgnlng    nucleus crelrs to ships under
  construction  or conversxon to dcternnne whether personnel asslgned to
  nucleus crews were being used effxclently          It 17~3s recognized that per-
  sonnel are asslgncd on a temporary basis for up to 6 months and that per
  diem costs are Involved      Furthermore   It v7a.s observed that the purpose of
  the assignment v7a.s to Insure the best possible products conslstlng        of
  both ships and quell organized an3 tralncd      crews are dellvered



       a  That there is an opportunity   to Lrrnsfer   to other uses slgnxfr-
  cant mnnporer and funds presenLly allocated     to nucleus crews

       b. Inat I* general, nucleus cretrs Pre sent to construction  sltps
  before they are needed to perform certarn  tasks that are already the
  responslblllty of other Navy organizaLions

           C    That the       present     method of asslgnlng          nucleus     crews 1s not based
  on actual       need.

      d    That the k7ork requirements                  have  not been evaluated             to determme
  the rates and ratings   that should                  be Included In a nucleus              cret7

       e. That the number of nersornel                       asslgned       to a nucleus     crew 1s based
  on 3lldgement and hlstorlcal practice

       f        That the period           of assignment       1s based on a 6 - month time                 Ilml-
  tatlon       tiler     per l-~em can orulnxzly            be paid

       g        That the system for             obtaining     xliormation       on the utlllzation             of
  nucleus       creu7s 1s Inadequate.

  GPO Ident            Lc~cd the recent     f6rmulatror       of a proposal       to place    a Fleet




                                                                                     Enclosure       (1)


                                                       30
                                                                                APPENDIX I


Introduction Team (Fll)   at building    sites on a permanent shore duty
basis to accomplish ccrtaln   tasks presently    perforrxd  by nucleus crews
The proposal would reduce the length of time certain       nucleus crew per-
sonnel would be assigned but nould not alter      the number of personnel as-
sxgned or the nucleus creus     composltron

GAO RECCXNEMDS

       a.   That the Secretary   of the Navy order

            1     A review of the nucleus crew program       to determine        the essen-
tial    functions     that nucleus crews should perform.

         2. An evaluation  of the corrposltlon and duration                  of manpower
needed to perform these functions  and assignment of only                   those rates,
ratings and man-months needed

     b   That procedures be established   to insure continual evaluation
of nucleus crew needs xncluding requlrjng    Prospcctlve  Gommandlng Officers
to report In their ship's progress reports recommended increases and
decreases in nucleus crew authorlzatlons

     C,     That the Fleet Introductzon    Team not be under the admlnistratlve
control     of the local supervisor    of shlpbulldlng, corlverslon, and repzlr

Ine GAO report covered      a period   of approrrr   "ttly   IS   moilLhs     from Nay 1969
to December 1370.

II.     DCPARTPZWT02 THE hAVY POSITIOL~.

      The Navy concurs 171th the recoxAendatlons      contalncd  In the GAO
Draft Report.      Of particular interest.   to the Havy IS the recognition    by
GAO of the current Navy efforts       In progress  to improve the methods by
which nucleus and balance crebs are asslgncd to new construction           and
conversion   ships

      The Navy does not agree fully  171th all of the flndlngs   as they are
stated 111 the report     SpeclfJc co*lments concerning  the areas of djs-
agreement   ere contalncd  In SCCL~OJ 111 of this reply



          The Nav) lnitlatcd     in April 1970 an AD HOC panel that was tasked
 to stud) Ned rer,om,cno solutlo?s           to problems associated      rnth delivery
of ne(I constl UCtl311 at-d comer >I on ~P~US and thcLr lntroductlon               into
the fleet       lhe draic. 1 eport (TXU A) of the results         of tins AD IlCC p-ncl,
d‘ltcd 2 ~cccr brl 1970, IS currcntl,           ~rl distrlbutjon  rlthln     Izvy for
ICVLIC’~J  ?nd corLacnts      Coxuri et,tl;,    the Chlcf of Neal OperaLions ap-
plovcd on 4 .~qnuqly 1971 the 3nstltutlnn              of a pilot progran for two Fleet
Tntro~uctlo~r     TLI T      C'O zddrcsscr: Ll?c EIT crj~tcep: -nd COI-1 rtc 1 o I llie




                                            31
    APPENDIX I


       number of personnel to be asslgncd to the team          Furthermore,   GAO Iden-
       tlflcd the problem of'the     proper adnnnlstratlvc    assignment to preclude
       an augmentation  of thetlocal     Supervisor  of Shlpbulldlng,    Conversion and
       Repair

           The Department of the Navy reserves comment on the FIT concept and
       the assxgnment thereof until   after the Implement-atlon and evaluation
       of the approved pilot  program

       Speclflc   comments are stlblmtted      below

      A    FINDING - The Navy has not evaluated work requirements  to deter-
       mine the rates and ratings that should be included In a nucleus crew.

      COFNCUT - The Office of the Chief of Naval Operations
      -0                                                      (OP-10) lnitlated
       a request on 4 January 1971 for a manpower survey of pre-commlSslon2ng
       eretrs (nucleus and balance crews). Ships of the DE-1052 and LST-1179
       classes are the recommended sample hulls.

            In Bfr\y of 1969,     upon first    contact xath GAO representatlves,a     memo-
.
       randum (OP-100~ ser        12368PlO of 22 >$~y r969) was provided,        This docu-
       ment addressed the       rationale    then titxlxzed  fobf the assignment of partlc-
      *ulal rates/ratings       for DE net7 construction     ships

             As an xnstrum$nt of self evaluatjon            the RTavy instituted      In Janwry
       1970 a rcclw4      nticlefis crew plc&:rayll for tit0 LSi-1179 class ships bullu-
       lng at pdtlona?      Steel and Shlpbulldlng        Company, San DLego, Cal~forntl
      Under this program the nucleus crett 1a.s reduced from 4 officers                     and CO
       cnl1stc.d pcrso,lqel     to 4 offlccrs      and 20 enllstcd        Reallzlng     that the
      membets of the nucleus cretv spend considerable               t$me   and efforL mono-
      tosinz constructloo         Pctlvitles,    the staff of CoTmanZer Amphrblous Force,
      U S P=iclflc I'lect and other ApphiblousStaffs                in the vLclniry        of tbe
      bulldIng     site \wx tasked wth prowc'lng             the expertise     to assist     the
      reduced nucleus crerT           The balance crew 1s ordered to the Fleet fralnlng
      Center, San D~.cgo for famlllarlzatlon             and lndoctrxnatlon       of net7 systc?%
      and equlprilent both at the fleet tralnlng             center and aboard ~~1-1179 cless
      ships already in corwnsslon              Feed back reports      evaluating    the redtced
      nucleus crew programs trill           be available   in >nrch 1971 or apploxlmately
      thirty    days after comnlsslonlng         of the SAGIKAW (LST-1188) and EO~DCR
      (LST-1190)

      B ---FII'DI~G - Ihe ~ac>'s system for          obtaining   informatxon    on the utlll?a-
      tron of nucleus wet's 1s lnadeauate

       co1 - - -- - hiI-7   I,.-1ect1ve OFI \IIST [ICC 8 (scrle-)         till  bc updated to
      ;nc1,1 c co I-~LI~LS ;W L thz “10 ,, sctlxe      &~-+a-,drrg    off] Lcr (,<<I) on t'r~
       utlll7Ption       of q nucleus crt7      Co~ir nts 171IL    be subpltted    as part of
       the Progress arid Rcw~lness Pcpcrts rccuxred b) fi7av-y Dlrectlvc,              OPxALq?I\'S1




                                                32
                                                                           APPENDIX I



9030 2     (series).

c       IINDING - The perrod of assignment 1s based on the 6 month time limit-
atlon      that per diem can ordlnarlly be pald.

 CO>XNT - 71~ nucleus crew consists of those personnel ordered directly
---
 to the bmldzng    shlpyard or convcrslon     site prior   to the comnnsslonlng
 of the ship    This detail    consists of experienced personnel and does
not normally receive pre-commissioning         tralnlng.   They assist   in asscm-
 blylng the Poe-com~lsslonlng     outflt,   in witnessing    tests of machinery
 and equipment and they serve as on the -Job instructors          for the balance
 of the crew when it reports        The phasing of the nucleus crew (approx-
 imately 25% of the authorized      manpower) 1s structured      so as to mlnlmlze
personnel haldshlps,     family separation,      and any unnecessary expenditure
 of per diem funds

For  authorzzed  orew      s17e.s  of less   than 350 billets, a nucleus   crew   (25%
of authorized   billets)        1s ordered   to report four months prior   to commls-
sioning

For authorized  crew sizes of greater  than 350 billets, a nucleus crew
of 5 officers  and 30 enlisted personnel are ordered to report 6 months
prior to conimissloning.

The staffing  plan    currently  utlllzed  evolved from past experience,   the
need LO properly   nlan~ge mznporcr assets, and the monltorlng    of nucleus
crew assets authorlded     by OSD

For FP 71, 75 percent of the new construction/conterslon       non-nuclear
powered ships 17cre manned 4 n onths or less pllor     to commlsszonlng        The
total nucleus crew manporter authorlLed   and assigned for these bulls F7as
129 officer   and 1693 enlisted billets    The manpoTqer associated     with the
renzlning   25 percent of the hulls was 60 officer     and 360 enlisted    billets

It IS therefore   the Navy's position that the structuring           of the staffing
plan was not. oriented  to the 6 month time llmltatlon     for       per diem funds

The hTaq staffing   Plan for ne+q construction    and maJor c&version   has nbt
been promulgated  in its entirety      A Navy dlrectlve,    OPNAvIN>T 3500 23A,
currently  in a second draft form end scheduled to be issued durlrig the
fourth quarter of FY 71, ~111 promulgate       the staffing  plan (TAB B)

D --IXNDINC - The number of perscknel     asslgned         to a nucleus    crew 1s
based on Judgcmznt a?d historical practl-ee

CO)fXTl-1~
---    -      WV) does not conslocI   this fInding to be crltlcal   01 Lhe
nlnqlng procedures   Ihe re,ccnl ly oLdered wnDwzer survey 1711.1. document




                                                33
APPENDIX        I



  through applied r7ork measuring tcchnlques             the z'equlred mznpo\;7cr to man a
  nucleus crew.       The current practice      orlglnated    with the first    post WI1
  maJor consLructlo2       efforL,    the DD-931 class dcstroyzr        Since that tlrre
  the nucleus crelr structure         has been modlfled by the expressed needs of
  Prospective     Commanding Offxcers,       th? hrstorlcal     results of va~lous net7
  coqstructlon     proglc7ms, and the Julgement of Navy Department experienced
  officers    t7ho have first      hand knowledge of the complcxltles        of modern
  naval new construction

  The results of the marlpo;Ter survey are antlclpated by end of the fourth
  quarter FY 71, and at that time mannzng adJustments will be Implemented.

  E --FINDINGS - - The present          method      of asslgnlng      nucleus     crews 1s n3t
  based on actual need.

                       - The Navy has a7 opportunity      to transfer    to other    use,
  slgnlflcant       manpower and funds ptesently    allocated    to nucleus    crews

                  - In general, nucleus cre17s are sent                      to construction  siies
  before they are needed and to perform certain   tasks                      that are alrendy the
  respo?slbzllty of other Navy orgdnl?atrons.

  --colQ%NTC - These flndlngs    are consIdered        Logical end-results      in view of
    the time spsn of the review,      the orlent2tlon        of the representatives      and
    the mcLhor'olo~y employed     The ~2vy recog717cs the need to rcflnz              cu1recit
  pr?ctlces    ticlth tht go21 of effcctlvely       uLlflLlng    avaIlable   manpor,ar
  assets and reducing the c+endlture           of austere per diem funds            The Navy
   considers thnt the vchlcles      to acco~pllsh        thzsc goals are preseiltly
  available    in thz form of the previously          mentioned AD HOC panel, FI'J. con-
  cept pllot     program 3q.l the recently     inltlated      m?npoder survey iequest
  'ihe Navy defers comment on the resoluLlon             of above findings    untrl   the
  evaluation     1s complete and results      of the current Na~ry studres and pro-
  grams have bzen reviewed
                                                                                          l-13
  Fe    NlnI’J.1 O?iAL
                 _L- CO XIJT’3
                        w-e--     I Under ~zvy Revre,q Procedures'   on page 25 of
  the  report it 1s stc ted that the Naval Inspector         General 1s responsible
  for perfoLnnng evalu?tlons      of the utlllzatlon     of nucleus crews, cltlng
  the provlslons    OZ a Navy Dlrectlve,     OPXAV Instruction     5300 3, T<hlch 1s
  ouldated and does not reflect        the OP,<AVorganlzatronal     changes dlrected
  by OPNAVLKS7 5430 serial     30$5PO9B3 of 30 ilprll     1968. This latter     mstruc-
  tion  transferred   the responslblllLles      foL alanpower vallddtlon   from the
  NAVINSGEq to the Deputy Chief of Naval. Operations           @EnpoTTer and Naval
  Reserve).




 1
     GAO note.       Page number      refers        to   draft     report.



                                               34
r   h




                                                           APPENDIX II

                          PRINCIPAL OFFICIALS OF
                       THE DEPARTMENTOF DEFENSEAND
                        THE DEPARTMENTOF THE NAVY
                        RESPONSIBLEFOR ACTIVITIES
                         DISCUSSEDIN THIS REPORT

                                              Tenure of offlce
                                              From            To
                           DEPARTMENTOF DEFENSE
        SECRETARYOF DEFENSE
           Melvin R. Lalrd                 Jan.     1969   Present
           Clark M. Clifford               Mar.     1968   Jan. 1969
           Robert S. McNamara              Jan.     1961   Feb. 1968
        DEPUTY SECRETARYOF DEFENSE
           David M. Packard                Jan.     1969   Present
           Paul H Nitze                    July     1967   Jan. 1969
           Cyrus R. Vance                  Jan.     1964   June 1967
        ASSISTANT SECRETARYOF DEFENSE
          (MANPOWER AND RESERVEAFFAIRS)
            Roger T. Kelley                Mar.     1969   Present
            Vxe Adm. W, R. Mack (acting)   Feb.     1969   Mar. 1969
            Alfred B. Fltt                 Oct.     1967   Jan     1969
            Thomas D. Morris               Oct.     1965   Sept. 1967
                          DEPARTMENTOF THE NAVY
        SECRETARYOF THE NAVY
           John H. Chafee                  Jan.     1969   Present
           Paul R. Ignatrus                Aug.     1967   Jan. 1969
           John T. McNaughton              July     1967   July    1967
           Paul H. Nltze                   Nov.     1963   June 1967
        UNDERSECRETARYOF THE NAVY
           John W. Warner                  Feb.     1969   Present
           Charles F. Baird                July     1967   Jan. 1969
           Robert H. Baldwxn               July     1965   June 1967
           Kenneth E. Belleu               Feb.     1965   July    1965
                                     35
APPENDIX II

                                      Tenure of office
                                      From            -To
                 DEPARTMENTOF THE NAVY (contmued)

ASSISTANT SECRETARYOF THE NAVY
  (MANPOWER AND RESERVE):
    James E. Johnson               Apr.   1971    Present
    James D Hlttle                 Mar.   1969    Mar. 1971
    Randolph S. Driver             Aug.   1967    Jan. 1969




                            36                   USGAO   Vash,DC